For years, restructures and redundancies have largely been viewed as HR and industrial relations processes.
Consultation obligations.
Redeployment considerations.
Selection criteria.
Communications strategy.
But what happens when the safety regulator steps in and says:
“Stop the restructure.”
That is exactly what reportedly occurred in 2025 when SafeWork NSW issued a prohibition notice to the University of Technology Sydney (UTS), effectively halting a major organisational restructure that could have impacted around 150 employees.
Halting 800 planned meetings!
And the reason was not physical safety.
It was the risk of psychological harm.
That’s right Psychosocial Risks and Hazards.
This may become one of the most significant psychosocial safety developments Australian employers have seen.
The Restructure That Triggered Regulatory Intervention
According to reports, UTS had scheduled meetings with approximately 800 staff regarding an “academic change proposal” linked to a $100 million cost reduction program. Staff were allegedly provided with only one day’s notice before the meetings.
SafeWork NSW intervened.
The regulator issued a prohibition notice on the basis that workers “are and will be exposed to a serious and imminent risk of psychological harm” arising from the way the process was being conducted.
The notice reportedly required UTS to:
- cancel the scheduled meetings;
- halt the release of the change proposal; and
- demonstrate that psychosocial risks had been properly managed before continuing.
Importantly, this was not a prosecution.
There was no final court finding.
No conviction.
No sentencing hearing.
Yet the impact was immediate and commercially significant.
The reported consequence?
A pause to a major restructure process that may have cost millions of dollars in delayed savings, consultant costs and operational disruption.
The Message To Employers Is Clear
Psychosocial hazards are no longer confined to bullying complaints, harassment allegations or workload management.
Regulators are increasingly looking at how organisational decisions are implemented.
And that includes:
- restructures;
- redundancies;
- performance management;
- workplace investigations;
- change management processes; and
- communication strategies.
The critical issue in the UTS matter was reportedly not whether redundancies could occur.
It was how the process was managed.
Many organisations still approach restructures primarily through:
- legal compliance;
- industrial obligations; and
- operational outcomes.
But regulators are increasingly asking a different question:
“What psychosocial risks did the employer identify and control during the process?”
This Is A Significant Expansion Of WHS Thinking
Traditionally, prohibition notices were associated with obvious physical risks:
- unsafe machinery;
- fall hazards;
- electrical risks; or
- dangerous worksites.
But under modern psychosocial hazard frameworks, regulators now have the power to treat psychological risks in much the same way as physical risks.
That means a poorly managed restructure process can potentially attract the same type of regulatory intervention as unsafe plant or equipment.
And for HR professionals, People & Culture teams, Safety teams, executives and Boards, that changes the conversation entirely.
The Overlap Between HR and WHS Is Growing Fast
This development does not exist in isolation.
Employers are already navigating increasing complexity around restructures and redundancies, including redeployment obligations following recent High Court authority regarding contractor and labour hire roles.
At the same time, psychological injury claims connected to restructures are becoming more visible.
This is where employers can become exposed on multiple fronts simultaneously:
- WHS obligations;
- workers compensation exposure;
- adverse action risks and general protections;
- unfair dismissal claims;
- consultation disputes; and
- reputational damage.
A restructure can quickly move from a commercial strategy discussion to a multi-jurisdictional legal risk event.
The Industrial Relations Overlay Cannot Be Ignored
One of the more interesting aspects of the UTS matter is the broader industrial relations context.
This reflects a broader trend emerging across Australian workplaces:
Psychological safety is increasingly becoming part of industrial strategy.
Whether employers agree with that trend or not is almost irrelevant.
The practical reality is that psychosocial hazards now sit at the intersection of:
- safety law;
- employment law;
- industrial relations;
- workers compensation; and
- organisational governance.
For leadership teams, this means restructures can no longer be approached solely as operational or financial exercises.
So What Should Employers Actually Be Doing?
One of the biggest mistakes organisations make during restructures is focusing almost exclusively on legal defensibility while overlooking psychosocial risk management.
That approach is becoming increasingly dangerous.
Before and during any restructure process, employers should be considering:
- Psychosocial Risk Assessments
Identify foreseeable psychological hazards connected to the process itself.
This includes:
- uncertainty;
- communication methods;
- time pressures;
- meeting structures;
- workload impacts; and
- redeployment ambiguity.
- Consultation Design
Not just whether consultation occurs, but how it occurs.
Timing, notice periods, sequencing and communication tone all matter.
- Support Mechanisms
Ensure support systems are visible and accessible:
- EAP access;
- support persons;
- manager training; and
- escalation pathways.
- Leadership Capability
Many psychosocial risks emerge not from the restructure decision itself, but from inconsistent leadership behaviours during implementation.
- Documentation
Employers should maintain clear records of:
- identified psychosocial hazards;
- control measures;
- consultation steps; and
- support initiatives.
Because if a regulator asks:
“What steps did you take to minimise psychological harm?”
The organisation will need a credible answer.
At South Geldard Lawyers, we work with employers, HR and safety teams and executives navigating complex workplace change, safety, psychosocial risk and employment law obligations.
If your organisation is planning a restructure, redundancy program or major organisational change, now is the time to ensure your process is not only legally compliant, but psychologically safe.
Increasingly, how you do it may matter just as much as why you do it.
