The process meant to help injured workers may deepen distress
A new study by Monash Public Health and Preventive Medicine has found that many injured workers develop a “secondary psychological injury” not from the original incident, but from prolonged uncertainty, financial strain, and stressful interactions during the workers’ compensation process. Researchers say the condition is difficult to detect at scale and is often underestimated in administrative data.
Stakeholders interviewed for the research estimated that about 10% of claimants across all claim types may experience this form of injury, with the proportion rising sharply in long-duration claims. Some rehabilitation providers suggested that nearly all workers with claims lasting more than 2 years face a high risk of psychological decline, whether formally diagnosed or not.
Uncertainty and loss of control
The report identifies uncertainty and a loss of personal control as the strongest drivers. Injured workers described “languishing” or “ruminating” over questions about income, recovery, and job security. Financial stress was a recurring theme, particularly where compensation replaced only a primary income source while other earnings, such as overtime, were lost.
Researchers found that workers often move from being fully independent to navigating an unfamiliar system where decisions about healthcare, payments, and return to work are made by others. This transition, combined with limited understanding of processes, was linked to heightened stress and anxiety.
Role of workplaces and claims managers
The worker’s direct line manager emerged as the most influential figure in either preventing or worsening psychological harm. Supportive communication, early engagement, and practical return-to-work planning were seen as protective. In contrast, inexperienced supervisors and perceived lack of workplace support contributed to social isolation and a loss of identity.
Interactions with insurers were also described as pivotal. High turnover among claims managers often meant workers had to repeatedly explain their injury, which stakeholders said was stressful and frustrating. Unempathetic communication and unclear explanations of decisions were considered especially harmful.
In Queensland, the average finalised time lost claim lasted around 68.7 days (nearly 10 weeks), while the median was 19 days (around 4 weeks). About 15% of claims involved more than 130 workdays lost. In Western Australia, roughly half of claims were finalised within six months, with income replacement claims often taking 6–7 months to conclude. In New South Wales, more complex claims can extend to 1.5–2 years, particularly when medical or legal disputes arise.
Timing, screening and prevention
The research found no single point when secondary psychological injury begins, but risk increases with claim length, difficult return-to-work attempts, and events such as medical examinations. Early intervention to reduce uncertainty was considered critical.
Tools such as the Kessler-10, DASS, and Orebro are used to screen workers for distress. Researchers noted these are not specific to secondary psychological injury and that the results should be considered in context.
Recommendations include clearer explanations of compensation processes, minimising repetitive assessments, training claims managers in empathetic communication, and offering early psychological support, particularly for workers with pre-existing mental health conditions or long-running claims.
