Canadian employers can lead by addressing mental health and psychological safety
Recent legislative developments in most provinces highlight the urgent need for all organizations to prioritize psychological safety and mental health. These laws are a call to action for HR leaders to turn compliance into a strategic advantage by fostering workplaces where every employee feels safe, valued, and supported. Quebec has also added compliance and governance steps that require action.
In March 2021, Quebec introduced Law 27, "An Act to Modernize the Occupational Health and Safety System." This legislation came into force on October 6, 2025. Law 27 establishes new obligations for businesses, such as including psychosocial risks in their occupational health and safety prevention plans. While Quebec’s laws are among the most comprehensive, other provinces are also strengthening their frameworks. Across Canada, Occupation Health and Safety Acts now almost universally include requirements to recognize and address mental health and psychological safety risks.
Why this is a critical moment
Mercer Marsh Benefits’ recent research shows that 51% of employees feel stressed in everyday life, 47% feel stressed at work most days with over 1/3 stressed in both. These stressors are costly—mental health issues account for 30% of all short-term disability and up to 50% of all long-term disability claims and are associated with increased absenteeism and turnover. Yet, organizations that prioritize mental health see a 15-percentage point increase in employees reporting they thrive in their roles.
This is a pivotal moment to act. Addressing psychosocial risks and fostering a culture of trust and openness can significantly improve employee well-being and organizational performance.
Your role as a Canadian employer
As HR leaders, you are uniquely positioned to lead this change. The laws in Quebec and across Canada set the foundation—your role is to embed these principles into everyday practices that promote respect, inclusion, and support.
Key actions include:
- Understanding the psychological risk profile of your workforce and workplace
- Addressing the most critical risks with specific actions
- Designing work that supports physical and psychological well-being, for example by reviewing workloads and social dynamics
- Building awareness through targeted campaigns and manager training
- Providing accessible, inclusive mental health benefits—such as counseling, digital tools, and preventative programs
The time to act is now. Workplace safety has evolved. Have organizational policies kept up? Mercer’s Global Talent Trends report indicates that only 35% of employees strongly agree that they can voice their opinion freely without fear of repercussion, and only 42% strongly agree that they feel psychologically safe at work. Those who do feel safe are 5.5 times more satisfied with no plans to leave, and 2.1 times more likely to recommend their employer to a friend. Beyond the legal obligation, safety is good for business: 70% of executives say that investing in psychological safety and workforce security will deliver a measurable return.
Take these steps today:
- Understand and assess the psychological risk profile of your organization.
- Prioritize the risks and take action to reduce them
- Launch broad mental health awareness campaigns and equip leaders to have empathetic conversations
- Proactively assess and redesign roles and workloads to reduce psychosocial risks
- Expand and actively promote mental health benefits, including onsite or virtual counseling options
Your leadership can make a difference
Creating a psychologically safe workplace isn’t just about compliance—it’s about building a resilient, engaged workforce that drives your organization’s future. Your workplace practices and culture can help or harm – knowing where to start is key. Mercer is here to support you with expertise, innovative solutions, and actionable insights to turn legal requirements into a strategic advantage.
The future of work depends on your action today. Invest in your people’s mental health. Foster a culture of trust and respect, and lead Canada’s workplaces toward a healthier, safer, more inclusive future. Because when you prioritize psychological safety, everyone benefits—your people, your organization, and your community.
Alex Boucher is a principal consultant at Mercer and the Growth and Strategic Leader of the Workforce Health Management practice for Canada and is a member of the global Workforce Health Leadership team. Alex has been active in supporting better workplace health for over 25 years.
