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Ways Remote Working is Damaging Your Mental Health

Mental Health in the Workplace

11 Mar 2025 (Last updated 3 Sept 2025)

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Remote work came as a blessing for several workers, especially caregivers. It meant spending quality time with children, with families, and saving time and costs on the long commute to work. But new research has highlighted the potential disadvantages of remote working or permanently working from home. There are 37% Aussie employees working from home. Within this group are home based workers, basically men and women who work at home for pay, according to the classification of an employee or an intermediary.

Black Dog Institute explained that majority of employees working from home have experienced negative impacts such as isolation, loneliness, and difficulty in separating work and personal life. However, it can be hard to understand the origin of these negative effects and how to particularly fix them. Employees are increasingly demanding remote working opportunities or seeking jobs that allow them to work from home. Many employees claim that it allows for better work life balance and greater autonomy. Like every method, it has its benefits and disadvantages. Working from home or working remotely for increased time periods can damage your wellbeing.

Working from home and mental health

 69% of remote workers report increased burnout from constantly being accessible and using digital communication tools. It leads to mental fatigue, due to a lack of clear boundaries. More than two-thirds of remote employees reported they have trouble getting away from work at the end of the day. They have trouble finding that elusive work life balance. Remote work is associated with ambiguity around role and feedback which could potentially increase emotional exhaustion. While WFH or remote work has been around for a long time, recently we have begun to see a sizeable shift and change in attitudes. This has also led to a discovery that working remotely may have long-term implications for mental wellbeing.

Other common risks include

  • Feeling isolated
  • Feeling disconnected- socially and professionally
  • Unable to stay motivated
  • Unable to prioritise workload
  • Uncertain working hours
  • Unsure about performance and career growth
  • Inability to take mind off work
  • Anxiety
  • Stress
  • Depression

How can you improve wellbeing while working remotely?

Your mental wellbeing is impacted by a combination of factors. There are factors you can control and factors that outside your control. The things you can directly control are things you should focus on while trying to improve your wellbeing.

A separate workstation

It can be extremely easy and convenient to just work from your bed or the couch. Due to a lack of space or home arrangements, employees resort to working at the dining table or coffee table. Your workstation can have a negative impact on your work performance and productivity. A poor setup can make it difficult to separate work and personal life, leading you to check emails after work hours. Small screens can also result in poor posture, eyesight, and cause headaches. According to a report, only 33% of employees who work remotely have a dedicated room for working from home, and half of those employees have to share that space with another person all day. A separate workstation can help you set boundaries and reduce stress by allowing you to have the quiet time you need to work.

Effective management

Only one in five employees feel their employers are actively supporting their mental health. Employees want to stay connected with their feelings and they need the support from their employers to do so. They are also nervous about taking time off for mental health reasons as they believe their employers might not understand. Business owners should create an atmosphere of trust and honesty within your company. For remote employees, this becomes exceptionally important as they need reassurances and support regularly compared to office-based employees. Employees should feel they can talk to their managers or their co-workers about their mental health anytime. Allowing this dialogue will lead to increased satisfaction among employees and result in higher productivity.

Physical health

When you work from home, your physical health and wellbeing determines your mental health. Your home environment contributes to the physical aspects of your wellbeing. Working in a poorly designed setup can affect your physical and mental health and stress you out. Stopping your workflow or sitting in chairs not meant for long-term sitting or working can increase the risk of physical injuries. It can also exacerbate existing problems that employees didn’t know they had such as depression or anxiety. Remote working can also lead to extended hours as employees have trouble switching off.

Many employers offer reimbursement for home office equipment which can have positive impacts on the physical health of employees.

Roommates or co-workers

While working from home, your mental health is also dependent on who you’re living with or who your ‘co-workers’ are. Whether it is a roommate, spouse, parent, dependent, child, or a pet, you will spend a considerable amount of time with them. Employees end up being interrupted or having to change their schedule to fit the needs of their families while working from home. Those who have to readjust their schedules or work hours around their families were more likely to report mental health conflicts.

A dedicated workspace can support your home environment and reduce the stress employees feel while juggling work and home at the same time.

Benefits of remote working

Remote work has been a gamechanger for many workers and they have no plans of going back to being office-based fulltime. Parents have more time to spend with kids and not feel guilty of missing out on important moments in home life. A range of positive benefits are associated with remote working such as reduction in travel time, reduced fatigue and reduction in costs associated with travel, food, fuel etc. It can also empower caregivers or senior employees to return to the workforce. People with disabilities who may otherwise not have enough opportunities for paid work find remote working a boon. It can reduce expenses for business owners by allowing them to reduce office space and extras.

Finding the balance

The evidence around permanent work from home or remote work indicates that people’s preferences and their subjective well-being are a key factor in whether remote work affects their mental health. It is also worth noting whether the benefits of remote working override the downsides like mental health issues such as anxiety and isolation. Different demographics will experience remote work differently. Young mothers, caregivers, disabled people will benefit from working from home. Younger workers, people who live alone, or are new to a city may benefit from being office-based. Working from home also depends on the job characteristics in question.

Finding the balance can be tricky but it’s vital to remember that people’s feelings about remote work are complex and layered. They might also change over time. Many workers in the early stages of their career may benefit from the social and emotional contact of the office. While when the same worker is ready to start a family, they may need a flexible work schedule and remote working arrangements. There is no one-size fits all solution and employers should remember to not fall in the trap of being rigid.

Challenges of hybrid work

Experts suggest that companies are being pushed into going fully remote as hybrid work is complex to manage. One of the important contributors to this choice is the rapidly shrinking talent pool. Businesses are afraid that staff may leave for remote-first or flexible jobs and want to ensure they don’t lose out on talent.

Trying to ensure Zoom calls are working during meetings and logistical complications that arise with different people having different work from home days are also making businesses wonder if it’s worth the stress at all. While going fully remote works for industries that do not need extensive collaboration, it may not have the same benefits for industries that need connection and collaboration. Customer facing industries such as hospitality or retail can’t have a fully remote workplace.

Full-remote set-ups can have negative impacts on new employees. There are potential challenges with onboarding and relationship management.

What can employers do?

Within this debate, there is one thing that is clear. Businesses need to adapt. It is very hard to predict what works and what doesn’t unless you are prepared for any eventuality. There is a significant lack of data around the benefits of any approach for the long-term. Companies are rolling the dice and taking the risk on what they believe suits their needs currently.

Having policies and processes in place to implement remote working can help improve mental wellbeing of employees. By ensuring that employees get a balance of remote work and being in office, business owners can support mental wellbeing and health of their staff. Where possible, employers should have official policies regarding working from home or remote working. It will also allow them to manage staff performance and set boundaries around work life balance.

Peninsula has worked with thousands of business owners across Australia in implementing policies and procedures. Call our advice line on 1300742953 today to get all your questions answered.

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They may also have difficulty setting boundaries between work and personal life, leading to burnout.   Employers can help mitigate these challenges by: Regularly communicating: Remote workers need to feel connected to their team and organisation. Employers should hold regular video calls, team meetings, and check-ins. Expectation setting: Remote workers need to know what is expected of them and when they are expected to be available. They also need to be able to set boundaries between work and personal time. Encouraging social connections: Remote workers can feel isolated and lonely. Employers can encourage social connection by providing opportunities for remote workers to connect with each other, such as virtual coffee breaks or team-building activities. Offering online support: For businesses with remote workers, it’s especially important to offer online support and digital resources promoting mental health. 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R U OK? Day 2025

R U OK? The three-word question and ten-minute chat that could change somebody’s life. Each year on the second Thursday in September is National R U OK? Day. This day is dedicated to reminding everyone that every day is the day to ask, ‘Are you OK?” History In 2009, founder Gavin Larkin wanted to ask one question, ‘Are you okay?’ to honour his father and try to prevent and protect other families from the pain of losing someone to suicide. He collaborated with Janina Nearn on a documentary to raise awareness, but they felt it wouldn’t be enough. To impact and change behaviour, a national campaign was needed. With this realisation, the idea of R U OK? Day was born. This movement is aimed at offering Australians skills and confidence to support those struggling with their mental health or feeling overwhelmed. Break down workplace barriers What can you do? R U OK Day is about everyone feeling heard and supported, including small business owners. 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If you see someone battling, don’t wait for them to speak up – take the initiative yourself. R U OK? has developed four conversation steps to give you the skills and confidence to navigate a conversation with someone you're worried about. Ask Listen Encourage action Check in Handling a sensitive subject If you decide to start a conversation with a co-worker, be sure to handle the situation delicately. For many people, mental health can be a sensitive subject. Here are some tips that can help the conversation go smoothly: The right time and place: Choose a time and place where you will not be interrupted and the person feels comfortable talking. A private office or quiet coffee shop may be good options. Ask the question: The best way to start a mental health conversation is to be direct and ask, “Are you okay?”. This shows the person you are concerned about them and you’re open to talking about mental health. 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Mental Health in the Workplace

What is an Employee Assistance Program (EAP)?

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The benefit of an employee assistance program is its accessibility. The service provides employees with coping strategies and resources. This support allows them to better manage personal and work-related stress they find overwhelming. Helping to maintain productivity, ultimately benefiting your business. By supporting employee wellbeing and job satisfaction through an EAP, you can improve staff retention and reduce the need for frequent hiring and training. Healthy and happy employees are more and engaged in both your business and their role, reducing absenteeism and increasing overall workplace morale. Employees can access help knowing their concerns will be handled discreetly and professionally. They are able to be open and honest about their challenges without the fear of judgment or repercussions in the workplace. An EAP typically includes telephone counselling, face-to-face sessions, and online resources. Some employees may be referred to for specialised or long-term support if needed. The cost of mental health to business It's often thought mental health challenges affect employees in large corporations in high-pressure, high-stress roles working long hours, or are in specific industries such as healthcare or the legal profession. In reality, SMBs are often more vulnerable to the financial and operational impact of mental health issues. Absenteeism, reduced productivity, and increased workplace health and safety compensation claims as well as high staff turnover is costly for small businesses. According to Safe Work Australia, the median compensation paid for mental health conditions in Australia in 2022-23 was $65,402. The median time lost from work in these cases is more than 5 times that recorded across all injuries/diseases. As a small to medium sized business owner the impact of poor mental health is substantial as you have fewer staff to cover for absent colleagues. This reduces productivity, increases workloads, and creates a higher level of stress and fatigue for remaining employees. As a consequence, this could lead to further instances of mental health challenges, stress leave and high employee turnover. Psychosocial hazards and EAP For some time, the focus of workplace health and safety was reducing hazards that could potentially cause a physical injury. In more recent years this has expanded to include psychosocial hazards, which can impact an employee’s mental health and wellbeing. Psychosocial hazards can include: Job demands: An excessive workload, unrealistic expectations leading to project failure, or tight deadlines requiring long work hours leading to fatigue. Employee support: A lack of management or supervisor support, poor co-worker relationships, or limited access to essential resources. Conflict: Workplace violence, verbal or physical intimidation, bullying, or sexual harassment. Role clarity: Unclear job expectations, responsibilities, or performance standards. Lack of recognition: Minimal or no recognition for achievements or contributions. Work isolation: A lack of social interaction or support of remote or isolated employees. An EAP and management of psychosocial hazards are connected. An EAP can play a key role in reducing the effects of psychosocial hazards by providing early intervention services for employees facing workplace stress, bullying, harassment, or interpersonal challenges. Effectively managing psychosocial hazards requires a proactive approach, including identifying and minimising hazards in the workplace. Absenteeism and presenteeism Mental health issues are a leading cause of unscheduled absenteeism. However, presenteeism, where employees attend work but are unproductive, can be an even greater problem. An employee struggling with their mental health may be physically present but functionally absent. Their ability to concentrate and perform tasks effectively is reduced, which could result in safety risks to other employees. This lack of focus can create a work backlog, result in missed deadlines, and a decline in output. The connection between poor mental health, productivity, and absenteeism can be difficult to identify at first and even harder to manage. The stress and anxiety associated with mental health issues can then manifest in physical symptoms, leading to increased sick days and further absenteeism. An EAP can help employees address challenges before they escalate and impact their personal and professional lives. Providing Employee Assistance Program services should not be considered a perk, but rather an essential part of your business. You’re investing in the ongoing health and wellbeing of your employees. It not only improves morale, productivity, and reduces absenteeism, an EAP can attract and retain top talent by building your reputation as an employer of choice that places the welfare of your employees first. To find out more on how offering EAP services to your team can help them better manage difficult situations, contact the team at Peninsula to learn about our 24/7 counselling helpline and other EAP services.

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