Psychological injury claims linked to workplace bullying and harassment are rising fast, and this isn’t just a problem for “bad workplaces.” New Allianz data shows bullying and harassment claims have increased by more than 75% since 2021, now making up almost 40% of all mental injury claims.
The message is clear. This is no longer about isolated incidents; it’s about workplace culture.
For business owners, this trend carries real consequences including higher workers’ compensation costs, lost productivity, reputational damage, and leaders spending more time managing conflict instead of growing the business.
What’s really driving the increase?
It’s tempting to assume behaviour has suddenly deteriorated. The reality is more complex, and more confronting.
1. People are more willing to speak up
Employees now have a clearer understanding of what bullying and harassment actually look like, including subtle behaviours, exclusion, and micro-aggressions that were once brushed off as “personality clashes.” While this is a positive shift, but it also means behaviours that went unchecked in the past are now being formally reported.
2. Return-to-office tension is creating friction
After years of remote and hybrid work, many teams are relearning how to interact face-to-face. Professional norms have shifted, patience is thinner, and expectations aren’t always aligned. Layer on return-to-office mandates, flexibility debates, and changed personal routines, and it’s easy to see how misunderstandings escalate into conflict.
3. Generational expectations are colliding
Workers aged 50-60 currently account for the largest share of claims, but Millennials and Gen Z are catching up quickly. Younger workers are more likely to prioritise mental health, understand their rights, and call out behaviour that feels unsafe or disrespectful. That’s reshaping what employees expect from leaders, and what they’re prepared to tolerate.
Why does this matters for businesses?
Bullying and harassment claims rarely come “out of nowhere.” They’re usually symptoms of deeper issues:
- Unclear behavioural expectations
- Inconsistent leadership capability
- Unmanaged workload or pressure
- Poor communication during change
If left unaddressed, these issues quietly erode trust and performance long before a claim appears.
What practical steps can business owners take now?
You don’t need more policies sitting on a shelf. What makes the difference is how culture is lived day to day. Start with these practical actions:
1. Reset behavioural standards – Be explicit about what respectful behaviour looks like – especially as teams return to more in-person work.
2. Equip leaders to manage early conflict – Most bullying claims start as unresolved issues. Train leaders to address concerns early, confidently, and consistently.
3. Listen before problems escalate – Regular check-ins, pulse surveys, or facilitated discussions can surface pressure points before they turn into formal claims.
4. Align expectations around flexibility and performance – Unspoken assumptions are a major source of tension. Clarity reduces conflict.
5. Treat psychological safety as a business risk – Psychological safety is not just an HR issue, and that’s exactly how insurers, regulators, and employees now see it.
The bottom line
The rise in bullying and harassment claims isn’t a passing trend. It’s a signal that workplace expectations have changed – permanently.
Businesses that respond early, rebuild trust, and actively shape culture will be better protected, more productive, and far more attractive to today’s workforce. Those that don’t may find the cost of inaction rising faster than they expect.
If you’re not sure how your workplace culture would stand up under scrutiny, now is the time to find out. A short, structured review of leadership practices, employee experience, and psychosocial risks can identify pressure points before they turn into claims, disputes, or lost talent.
If you’d like support to:
- Assess your current culture and risk exposure
- Equip leaders to manage issues early and confidently
- Strengthen psychological safety without adding unnecessary bureaucracy
… get in touch for a confidential, practical conversation. Early action is far easier and far less costly than managing the consequences later.
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