What Victoria has proposed

Remote work is a recognised psychosocial hazard under Australian WHS law. Most employers do not treat it as one, and Victoria's proposed work from home entitlement is about to make that gap harder to ignore.

The Victorian Government has announced that from 1 September 2026, employees whose roles can reasonably be performed remotely will have a statutory entitlement to work from home two days per week. The entitlement will be enshrined in the Equal Opportunity Act 2010 (Vic) rather than industrial relations legislation, with disputes resolved through VEOHRC conciliation and, if unresolved, VCAT. Workplaces with fewer than 15 employees will have until 1 July 2027 to comply.

The legislation has not yet been introduced to Parliament. That is scheduled for July 2026. Business groups including the Victorian Chamber of Commerce and Industry have raised concerns about its scope, cost, and constitutionality, and legal commentators have questioned whether Victoria has the power to legislate on what may be characterised as an employment condition rather than an equal opportunity matter.

Whether the bill passes in its current form remains an open question. But the psychosocial compliance obligation it intersects with is not open to question, and it already applies to every Australian employer regardless of what Victoria's Parliament decides.

What Australian WHS law requires for remote workers

Remote or isolated work is one of the 17 psychosocial hazard categories identified in the Managing Psychosocial Hazards at Work Code of Practice. Safe Work Australia classifies remote or isolated work as both a psychosocial and physical hazard, and the model WHS Regulations (regulation 48) specifically require persons conducting a business or undertaking (PCBUs) to manage the health and safety risks to remote workers and maintain effective communication systems.

This is a national obligation. Every Australian jurisdiction now mandates that employers identify, assess, and control psychosocial hazards with the same rigour applied to physical risks. When an organisation shifts a portion of its workforce to home-based work, the psychosocial hazard profile of that workforce changes. The duty to assess and control that change sits with the employer regardless of which state they operate in.

The Victorian WFH entitlement, if enacted, does not create the psychosocial obligation. It amplifies it by increasing the volume of remote work that employers must manage safely.

Why Victoria's regulatory environment makes this more acute

Victoria has the most prescriptive psychosocial regulations in Australia. The Occupational Health and Safety (Psychological Health) Regulations 2025, in force since 1 December 2025, require Victorian employers to identify psychosocial hazards, implement controls using a modified hierarchy that limits reliance on training alone, and review those controls when specific triggers occur.

One of those triggers is a change to a process or system of work that is likely to result in changes to the risks associated with psychosocial hazards. A legislated right to work from home is a change to a system of work. Under Victoria's own psychosocial regulations, that change triggers a mandatory review of psychosocial risk controls.

The proposed WFH entitlement and the existing psychosocial regulations were not designed together, but they interact directly. Colin Biggers & Paisley flagged this intersection in their analysis of the proposed legislation, asking how an employer manages the psychosocial safety of a home-based workforce without contravening the Equal Opportunity Act. That question does not have a settled answer yet, and it applies to every Victorian employer with remote-capable roles.

For employers operating across multiple states, the picture is more complex again. The WFH entitlement may be Victorian, but the psychosocial duty applies in every jurisdiction. A nationally consistent hybrid work policy still requires psychosocial hazard assessment in every state.

The specific psychosocial hazards of home-based work

Home-based work introduces or amplifies several psychosocial hazards that do not present in the same way in an office environment. Employers have a duty under WHS law to identify these hazards, assess their severity, and implement proportionate controls.

Social isolation and reduced support. Workers at home have less access to informal support from colleagues and supervisors. The casual check-in, the overheard conversation that surfaces a concern, the walk to the kitchen that creates an opening to raise a problem: none of these happen when someone works alone from a spare room. Safe Work Australia identifies reduced access to support networks as a key characteristic of remote or isolated work that can cause a stress response which, when frequent, prolonged, or severe, may lead to psychological or physical injury.

Blurred boundaries between work and personal life. When the workplace is the home, the distinction between work time and personal time erodes. Workers may find it harder to switch off, harder to take breaks, and harder to separate the cognitive demands of the role from the demands of their household. This is a workload and job demands hazard, not merely a lifestyle preference.

Reduced access to reporting channels. Workers who experience psychosocial harm while working from home, whether from workload pressure, isolation, or poor management practices, are less likely to report it when they are physically separated from the systems and people that facilitate reporting. If an organisation's reporting system depends on proximity, visibility, or informal trust built through daily contact, that system degrades when half the workforce is remote.

Diminished supervisor support and oversight. Managers who are effective in person may not have the skills, training, or systems to identify early signs of psychological distress in a remote worker. Without deliberate, structured check-ins, the visibility that protects workers in an office environment disappears.

Digital presenteeism. The pressure to demonstrate productivity when working from home through constant availability on messaging platforms, rapid email response, or visible online status can create a sustained low-level stress response that compounds over time. This is an emerging psychosocial hazard that most risk assessments do not yet capture.

These psychosocial hazards interact. A worker who is isolated, under workload pressure, unable to disconnect, and uncertain whether their manager notices or cares is experiencing a compounding psychosocial risk. Under Australian WHS law, the employer has a duty to identify that compounding risk and implement controls proportionate to it.

The claims data behind the obligation

The financial and human cost of unmanaged psychosocial risk is not hypothetical. Mental health claims now account for 12% of all serious workers' compensation claims in Australia, representing a 161% increase over the past decade, the largest growth of any injury category tracked by Safe Work Australia.

In the most recent reporting period, 17,600 serious mental health claims were lodged, an increase of 14.7% in a single year. The median time lost per mental health claim is 35.7 weeks, compared to 7.4 weeks for other serious claims. The average compensation payment for a mental health claim is $67,400, compared to approximately $16,300 for other serious claims.

Psychological injury claims cost approximately four times more than physical injury claims and take approximately five times longer to resolve. For employers scaling up remote work without reassessing their psychosocial risk profile, these numbers represent the cost of hazards that shift and intensify when work moves from the office to the home.

What this looks like when it goes wrong

An organisation approves two days of remote work per week for eligible employees. It updates its HR policy, communicates the change, and considers the matter closed.

But it does not reassess its psychosocial risk register to account for the hazards that home-based work introduces. It does not consult workers about the psychosocial conditions they experience when working remotely: isolation, boundary erosion, inadequate workstation setup, reduced access to support. It does not review whether its existing control measures, designed for an office-based workforce with daily face-to-face contact, remain effective when half the team works from home. It does not update its reporting systems to account for reduced visibility. It does not train managers to identify psychosocial distress in workers they see on a screen rather than across a desk.

The HR policy is compliant. The psychosocial risk assessment is not. That gap is where the exposure concentrates, for workers, for managers, and for officers with due diligence obligations under WHS law.

What employers should do now

Every organisation with remote or hybrid work arrangements should treat any increase in home-based work as a psychosocial hazard trigger, whether that increase is driven by Victorian legislation, federal flexible work provisions, or an internal policy decision. The following steps align with the risk management process required under Australian WHS law.

Reassess the psychosocial risk register. Add remote work hazards explicitly: social isolation, boundary erosion, reduced supervisor support, diminished reporting access, and digital presenteeism. Assess their prevalence and severity across roles, teams, and locations. Do not assume a single risk assessment covers an entire remote workforce; the hazard profile varies by role, seniority, household circumstances, and the proportion of time spent working from home.

Consult workers. The duty to consult is explicit in WHS law and reinforced in Victoria's Psychological Health Regulations 2025. Ask what psychosocial hazards workers experience when working from home. Ask whether existing controls address them. Ask what has changed since the last assessment. Document the consultation, the hazards identified, and the responses.

Review control measures. Controls designed for an office-based workforce may not transfer to a remote environment. A manager check-in that happens naturally in person needs a deliberate, structured replacement when the worker is at home. A reporting system that relies on proximity needs a remote-accessible alternative. Under Victoria's regulations, training and information alone cannot be the predominant control measure unless other options are not reasonably practicable.

Document and set review intervals. Record the hazards, the controls, the consultation, and the review schedule. Set defined review intervals and trigger-based reviews. Victoria's Psychological Health Regulations require review before any change to a system of work that is likely to alter psychosocial risks, after receiving a report of a psychological injury or psychosocial hazard, and after any notifiable incident involving psychosocial hazards.

Do not separate the employment decision from the safety decision. The organisations that manage remote work as an HR policy in one team and psychosocial compliance as a WHS function in another will find themselves exposed in the gap between the two. The employment entitlement and the safety obligation intersect. The compliance response needs to as well.

The gap that matters

Victoria's proposed WFH entitlement may or may not pass in its current form. But the psychosocial compliance obligation it intersects with already applies to every Australian employer with remote or hybrid workers.

The question is not whether your organisation allows remote work. It is whether your psychosocial risk assessment reflects the hazards that remote work introduces, whether your controls are designed for a workforce that is not always in the building, and whether you can demonstrate to a regulator, a board, or a court that you managed those hazards systematically rather than reactively.

The organisations that can answer those questions will be prepared regardless of what Victoria's Parliament decides. The ones that cannot will find themselves exposed in the gap between the policy they wrote and the hazards they did not assess.

Disclaimer: This article provides general information on psychosocial compliance in Australian workplaces. It does not constitute legal advice. Organisations should consult qualified professionals for advice specific to their circumstances. Data cited is sourced from Safe Work Australia and relevant state regulators as of the date of publication.