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Restructures and Redundancy: The Psychosocial Risk Most Organisations Never Assess

21 September 2026 · By Peter Kelly

When an organisation plans a restructure, the business case is usually thorough. Costs are modelled and legal advice is taken. What is often missing is any assessment of what the change will do to people’s health, including the people who keep their jobs.

Redundancy and mental health are linked, and the uncertainty before any decision carries its own risk. The law already expects employers to review their risk assessments when work changes significantly. A restructure is about as significant as change gets.

In my view, organisational change is the psychosocial hazard most often managed as a project and least often managed as a risk.

Change is a recognised cause of work-related stress

Change is one of the six Management Standards published by the Health and Safety Executive (HSE), its framework for managing the causes of work-related stress. HSE’s standard is that employees say the organisation engages them frequently during change, and that systems are in place locally to respond to individual concerns.

HSE estimates that 964,000 workers in Great Britain were suffering from work-related stress, depression or anxiety in 2024/25, with 22.1 million working days lost. That is 52 per cent of all work-related ill health. Workers responding to the Labour Force Survey named organisational changes at work among the causes, alongside workload, lack of managerial support, violence and bullying, and role uncertainty.

WHO, the United Nations agency for health, lists job insecurity among the risks to mental health at work. It also notes that unemployment, job and financial insecurity, and recent job loss are risk factors for suicide attempts.

Uncertainty itself is a hazard. A 2016 meta-analysis of 20 cohort studies found perceived job insecurity was linked to a higher risk of depressive symptoms, comparable to the risk linked to unemployment itself.

The people who stay are exposed too

Support naturally focuses on the people leaving. That is only half the risk.

Two Finnish studies of local council employees, published in the British Medical Journal, looked at people who kept their jobs. In the first, sickness absence among 764 employees who remained was 2.17 times higher after major downsizing than after minor downsizing. Changes in the work itself, including physical demands, job control and job insecurity, accounted for almost half of that link. The second followed more than 22,000 employees and concluded that downsizing may increase sickness absence, and the risk of death from cardiovascular disease, among people who stay.

The same work is spread across fewer people. Roles blur. Trusted colleagues disappear. Managers who delivered the news carry it with them. Each is a psychosocial hazard that can be assessed.

In safety-critical industries the stakes are higher still. HSE guidance on organisational change and major accident hazards, which also applies to rail and nuclear, notes that organisational changes are often not analysed and controlled as thoroughly as changes to plant. It cites a 1992 incident at Hickson and Welch in Castleford, where five employees died. Following a reorganisation, the task had been organised by inexperienced team leaders reporting to an overworked area manager.

What the law already expects

Under section 2 of the Health and Safety at Work etc. Act 1974, every employer must ensure, so far as is reasonably practicable, the health, safety and welfare at work of all employees. Regulation 3 of the Management of Health and Safety at Work Regulations 1999 requires a suitable and sufficient risk assessment, and regulation 3(3) requires it to be reviewed if there is reason to suspect it is no longer valid or there has been a significant change, with changes made where needed.

HSE is plain that employers have a legal duty to protect employees from stress at work by doing a risk assessment and acting on it. So if your stress risk assessment was written for the old structure, it no longer describes the work.

Redundancy consultation is a separate duty. GOV.UK guidance explains that collective consultation rules apply when 20 or more employees are to be made redundant within 90 days at one establishment, with minimum periods of 30 or 45 days depending on numbers. That process is not a health and safety risk assessment. Both need doing.

How to assess a restructure before you announce it

HSE guidance on change separates two things: assess the risks of where you want to get to, and the risks of how you get there. In practice, that means six steps.

  1. Assess before you announce. Build psychosocial risk into the change impact assessment at design stage, using the six Management Standards as prompts: demands, control, support, relationships, role and change.
  2. Consult early, and mean it. HSE expects timely information about the reasons for change and real opportunities to influence proposals. Involve health and safety representatives, not just the redundancy consultation team.
  3. Sequence your communications. Decide who hears what, when and from whom, so nobody learns their future from a rumour. Share the timetable and likely impact on jobs, and say when the next update will come.
  4. Prepare the managers who deliver the news. Brief them properly and give them time and support of their own, as they may face uncertainty too.
  5. Redesign the work for those who stay. Map tasks from the old structure to the new one, check workload and role clarity, rather than assuming the team will absorb the gap.
  6. Watch for warning signs, then review. Agree what you will monitor, such as absence, overtime, grievances and turnover in affected teams, and formally review the risk assessment once the new structure has bedded in.

ISO 45003, the global standard for psychological health and safety at work, points organisations towards tackling the root causes of psychological ill health rather than only dealing with the consequences. A restructure redesigns those causes, for better or worse. An ISO 45003 gap analysis will show whether your change process treats psychosocial risk as seriously as cost, and our strategic advisory work helps leadership teams plan change that people can come through well.

Frequently asked questions

Do we have to review our stress risk assessment before a restructure?

Regulation 3(3) of the Management of Health and Safety at Work Regulations 1999 requires a risk assessment to be reviewed when there has been a significant change in the matters it relates to, or when there is reason to suspect it is no longer valid. In my view, a restructure that changes roles, workloads or staffing levels is likely to meet that test. Assess the psychosocial risks while the change is still being designed, then review again once the new structure is in place. Take employment law advice on the redundancy consultation itself.

How can we support employees who keep their jobs after redundancies?

Start with the work, not a wellbeing email. People who stay may inherit extra workload, unclear roles and lost colleagues, and research on employees who remained after downsizing links those changes in work to higher sickness absence. Map what each remaining role now involves, remove or reallocate tasks rather than stretching people, and make sure managers have time to hold one-to-one conversations. Keep communicating, monitor absence, overtime and turnover, and review your risk assessment once things settle.

Sources

About the author

Peter J Kelly is an occupational psychologist and the founder of Being Real. He spent more than twenty years at the Health and Safety Executive shaping national policy on workplace mental health, sat on the panel that drafted ISO 45003, and was expert convenor for BS 30480. Being Real supports organisations with ISO 45003 gap analysis and certification, BS 30480 implementation, psychosocial risk assessment, strategic advisory and training.

If you or a colleague are struggling, Samaritans are free, confidential and open 24/7 on 116 123.

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