A quantified case for investing in early intervention, prepared for funding partner and stakeholder proposals.
For superannuation trustees, spending on workplace mental health prevention isn't a discretionary act of goodwill. It sits inside a legal obligation to act in members' best financial interests.
Section 52(2)(c) of the Superannuation Industry (Supervision) Act 1993 requires trustees to perform their duties and exercise their powers in the best financial interests of beneficiaries. APRA's Prudential Standard SPS 515 reinforces this by requiring trustees to evidence how expenditure decisions improve member outcomes. Psychological distress in the workplace is a direct, measurable driver of the costs that erode those outcomes: insurance claims paid from member premiums, and reduced contributions when distress pushes people out of work. Funding prevention is one of the few levers a fund has that plausibly satisfies this duty rather than simply complying with it.
Mental health has overtaken physical injury as the leading cause of claims against the very insurance products super funds hold on behalf of members.
Of all TPD claims nationally
~30%
Paid for psychological TPD claims in 2024
$2.2B
Of income protection claims
1 in 5
Projected total mental health claims, 2026
$4B+
Total mental health claims across group and retail life insurance have grown from $1.2B (2019) to $2.4B (2024); claims among Australians in their thirties are up 732% over the past decade. Sources: Council of Australian Life Insurers / Conexus Financial; see resources below.
Insurance claims are the end point. Presenteeism and absenteeism are where the cost actually begins, and it's already showing up in payroll and output, long before anyone lodges a claim.
The calculator below uses regression-adjusted cost estimates from the largest longitudinal study of its kind in Australia (an analysis of eight waves of HILDA survey data covering 18,729 working adults) to put a live dollar figure on the presenteeism and absenteeism cost of psychological distress in any workforce. Use it to size the cost for a prospective partner's own employee base, or for the broader membership a fund represents.
Total annual cost
$0
Presenteeism
$0
Sickness absence
$0
Employees with moderate distress
0
$1,226.96 each per year
Employees with high distress
0
$3,755.31 each per year
The study drew on eight waves of the Household, Income and Labour Dynamics in Australia (HILDA) Survey, collected between 2007 and 2021. The final sample covered 70,973 person-year observations from 18,729 working adults aged 17 to 67.
Psychological distress was measured using the Kessler 10 (K10) scale and grouped into three levels: low, moderate and high. The default prevalence figures in this calculator (22.1% moderate, 15.2% high) reflect the pooled proportions across all eight survey waves.
Sickness absence costs were calculated as the additional days of paid sick leave taken by workers with moderate or high distress, compared to workers with low distress, multiplied by average daily wages.
Presenteeism costs were calculated from the number of additional days worked while unwell, multiplied by 13 to estimate an annual figure, then multiplied by average daily wages. The calculation assumes a worker completes half of their usual output on a day worked while unwell.
Both figures were derived from fixed-effects regression models that track changes within the same person over time as their distress level changes, controlling for factors including age, income, education, health behaviours, occupation and job satisfaction.
SuperFriend's Domains of a Thriving Workplace Framework, peer-reviewed and validated in the Journal of Occupational Rehabilitation (2025), is the only national, evidence-based model of what drives workplace mental health. It is the map this funding case is built around.
The 2025 Indicators of a Thriving Workplace survey of over 12,000 Australian workers puts the national Thriving Workplace score at 68.4 out of 100, unchanged since 2024. Averaged from five Domains, the score shows exactly where the national picture is strong and where it isn't, ranked here from strongest to weakest:
Connectedness
Quality of interpersonal relationships
75.7
Safety
Protection from harassment, bullying, discrimination and violence
71.9
Leadership
How managers support their employees' mental health
67.2
Work Design
How roles, tasks and responsibilities are organised
65.3
Capability
Skills and resources available to support mental health
62.0
Work Design (65.3) and Capability (62.0) are the two lowest-scoring Domains nationally, and both have sat flat for two years running. Work Design covers how roles, tasks and workload are organised; Capability covers whether workplaces actually have the skills and resources to support mental health. Nationally, 45% of workers are at risk of or already burned out, and mental health conditions now account for 12% of serious workers' compensation claims, up 161% over the past decade, which is what happens when the two weakest Domains don't move.
The 14 psychosocial hazards employers have a legal duty to manage under Safe Work Australia's Code of Practice map directly onto these five Domains: workload and job control sit under Work Design, management support and recognition under Leadership, bullying and harassment under Safety, isolation under Connectedness, and access to mental health support under Capability. Acting on the Domains is, in practice, how a workplace meets that legal duty.
The framework holds up in practice, not just in survey data. In SuperFriend's own case studies, a national transport operator and a retail employer both used the five Domains to structure targeted interventions, from shift-swap systems and upgraded rest facilities (Work Design, Connectedness) to normalised EAP use and customer-aggression training (Leadership, Capability, Safety), with reported reductions in burnout and psychological distress across the board. Psychological safety, built through strong Leadership and Connectedness scores, is a large part of why this works: workers reporting high psychological safety are far more likely to say they intend to stay with their organisation (89.9%) and to be performing near their best (76.7%) than those reporting low psychological safety.
Funding directed at the Domains where Australia is weakest, Work Design and Capability, is funding aimed at the exact levers already shown to move burnout, distress, retention and claims. That is the version of this case that can be measured again next year against the same national benchmark.
Keramat et al. (2025), European Journal of Health Economics
Longitudinal HILDA-based study underpinning the calculator's presenteeism and absenteeism cost figures.
APRA: Expenditure outcomes, putting members' best financial interests first
Regulatory basis for the BFID and its application to trustee expenditure decisions.
apra.gov.au →Super funds and insurers confront escalating mental health claims crisis
Investment Magazine roundtable with fund and insurer CEOs on claims trends, sourced from CALI and Conexus Financial data.
investmentmagazine.com.au →SafeWork NSW: Code of Practice, Managing psychosocial hazards at work
Sets out employers' legislated duty to identify and manage the 14 psychosocial hazards referenced above.
safework.nsw.gov.au →Comcare: Managing psychosocial hazards, regulatory guide
Commonwealth guidance on the positive duty to eliminate or minimise psychosocial risk.
comcare.gov.au →SuperFriend: Our Story
Background on SuperFriend's role as the mental health foundation funded by the superannuation and life insurance industries.
superfriend.com.au →Indicators of a Thriving Workplace, 2025 Key Insights Report (11th edition)
SuperFriend's annual national survey (12,214 workers, 19 industries) behind the Domain scores and hazard data used above.
Iles & Sheppard (2025), Journal of Occupational Rehabilitation
Peer-reviewed validation of SuperFriend's five Domains: Leadership, Connectedness, Safety, Work Design and Capability.
"Our vision is for an Australia where all workplaces are mentally healthy."
Funding channelled through SuperFriend supports the data, training and workplace programs that address psychosocial risk at both the structural and individual level, before it becomes a claim and before it becomes a cost to members' retirement outcomes.