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Legal expert Carolyn Ng and business leader Dr Venka Purushothaman unpack why psychological safety is no longer a soft workplace ideal – exploring the legal risks of silence, and the policies, culture, and feedback channels needed to help people feel safe, respected, and heard.
What is psychological safety, and why is it important in the workplace in this era? Living in a post-pandemic world has cracked open the window to more conversations about mental wellbeing; both at home and at the office.
According to Harvard Business School, psychological safety encourages people within a group to offer opinions, suggest ideas, ask questions, raise concerns, and admit mistakes without fearing negative consequences. It can be further broken down into four key elements:
- Willingness to help, in which employees feel it is safe to ask for help, and in turn, offer help when their colleagues need it.
- A sense of belonging, where employees feel that their diverse experiences, perspectives, and expertise matter.
- A healthy attitude to taking risks and admitting failure, as it is acceptable in favour of learning.
- Open, candid, and safe communication, where employees feel able to contribute honestly.
Psychological safety has gained further relevance as conversations around workplace wellbeing become more closely linked to organisational risk. According to a blogpost by Medium, this due to the increasing scientific clarity around psychological harm itself. As time evolved and the younger generation prioritise work-life balance, research on occupational health psychology reveals that prolonged exposure to toxic work environments becomes a legitimate risk factor for anxiety disorders, depressive episodes, and other stress-related disorders.
For HR leaders, this raises an important question: when does workplace stress, silence, or fear stop being a culture issue and start becoming a legal or organisational risk?
To unpack this, Sarah Gideon speaks to Carolyn Ng, Senior Associate at MahWengKwai & Associates, and Dr Venka Purushothaman, President of LASALLE College of the Arts, on why psychological safety requires more than good intentions – and how HR, legal teams, and psychologists can work together to build safer, more responsive workplaces.
When psychological safety becomes a legal risk
From a legal standpoint, Ng says psychological safety can become a liability issue when it overlaps with areas already regulated under Malaysian employment law – i.e., harassment, bullying, discrimination, and constructive dismissal.
Although "psychological safety" itself is not a defined legal term, Ng notes that failing to maintain a psychologically safe workplace can expose employers to several types of claims, including:
- Constructive dismissal: This may arise if an employee can show that the work environment was so hostile, intimidating, or humiliating that they had no choice but to resign. Ng adds that the erosion of mutual trust and confidence between employer and employee can be grounds for an unfair dismissal claim at the Industrial Court.
- Sexual harassment claims: Employees may bring claims before the Anti-Sexual Harassment Tribunal established under the Anti-Sexual Harassment Act 2022. Ng explains that such claims may involve any unwelcome sexual conduct – whether verbal, non-verbal, visual, gestural, or physical – that causes offence, humiliation, or poses a threat to a person’s wellbeing.
- Criminalisation of psychological harm: Ng also points to the Penal Code (Amendment) Act 2025, under which it is a criminal offence to use threatening, abusive, or insulting words, communications, or actions with the intent to cause harassment, distress, fear, or alarm. She notes that the law explicitly defines "harm" to include psychological harm, alongside damage to a person’s body, mind, reputation, or property.
Medium's blog post observes that organisations have traditionally approached psychological safety as a matter of workplace culture, often through surveys, team retrospectives, open-door leadership practices, and iterative feedback loops. However, when psychological risk factors contribute to diagnosable stress, burnout, or discriminatory silencing, the issue may move beyond culture and into more concrete legal territory.
Ng says one common misconception companies have is that their legal duty is limited to protecting employees’ physical safety. She elaborates: "While physical safety is easier to evaluate and ensure, companies often find themselves justifying bad behaviour, from a psychological aspect, by relying on cultural norms."
Another misconception, she adds, is that having a written policy automatically protects the organisation. "Many companies also fall into a trap of believing that where there is a company policy in place, they are automatically protected from any complaints or issues. In situations where the policies are not communicated and enforced, the company will still be considered liable."
She also cautions employers against underestimating the evidential weight of day-to-day workplace communications and management practices. "The weight of cultural evidence in things like WhatsApp communications, performance management, micromanagement, and exclusion should not be underestimated.
"In situations where these instances are well documented, they carry significant weight in displaying a pattern of behaviour against employees."
So, the question stands: How can HR measure and monitor psychological safety? An article by the National Law Review reveals five ways to cut the subtle bully out of organisational culture and reduce legal risks.
- Train your leaders in emotional intelligence as it fosters inclusion, respect, and fairness, lowering the likelihood of behaviours that spark claims of discriminatory treatment and harassment.
- Establish effective feedback loops that employees feel safe enough to provide input and raise concerns without fear of retaliation. It is also important to ensure that feedback leads to visible action, not dismissal or silence.
- Investigate complaints promptly and fairly. Failure to do so can be one of the quickest ways to land in legal trouble. Whether it's an EEO complaint, retaliation claim, or lawsuit, courts look closely at an employer’s response. Building an established, fair process that applies to everyone, regardless of rank or revenue, keeps the company protected and ensures employees feel safe speaking up.
- Protect employees from retaliation by ensuring that employees who report misconduct are shielded from backlash. Failure to do so may result in costly retaliation lawsuits, even if the underlying complaint isn’t substantiated.
- Model healthy leadership at the top: Demonstrating respect, accountability, and fairness sets the tone for the entire organisation.
However, balancing how to protect an organisation whilst keeping a transparent and trusting workplace can be tough. In tackling this, Ng says the starting point is to ensure that clear policies are in place and properly implemented. "The main method of protection would be to ensure that there are policies in place, whether by way of a memo or an employee handbook. This handbook/memo should be made known to all employees, readily available for reference and strictly enforced to ensure proper compliance.
"The company should also ensure that it has clear reporting and investigation processes and procedures in place. A clear grievance procedure ensures that companies are able to run their day-to-day processes with minimal intrusion, while empowering employees to speak up when issues arise."
Training, she adds, should also be provided to ensure that all employees are on the same page on communicating between team members and colleagues.
"Such trainings can be conducted on matters such as boundaries in the workplace and respectful communication."
As the conversation draws to a close, Ng shares one step HR, legal, and psychologists can take together that would make the biggest difference when fostering psychological safety. "The main thing that HR, legal, and psychologists can work together to do would be to build a unified cross-disciplinary 'Safe Workplace Response Framework', which provides a single, integrated process for handling complaints, performance concerns, interpersonal conflict, and psychosocial risk."
Under this framework, Ng explains, HR would contribute to operational execution and advise on company policies, training, and culture. Legal would advise on compliance with the relevant legislative frameworks, while psychologists would help identify psychosocial risks, offer clinical guidance, and design interventions.
"This coordinated framework would ensure that investigations, interventions, and culture-building all follow a consistent and proper approach," she concludes.
Building care and trust into institutional culture
As for LASALLE College of the Arts, Dr Venka brings a different lens. As an institution of higher learning and a two-time recipient of Singapore’s Silver Ribbon Mental Health Award, LASALLE strongly advocates for a safe and conducive learning and working environment.
He shares that the College’s ethos is anchored in a history of care and empathy for all, with a strong track record of leading the way in arts and wellness through its pioneering MA Art Therapy and MA Music Therapy programmes, as well as initiatives and collaborations in the healthcare space.
"The College’s Code of Conduct emphasises the importance of respect, courtesy and dignity, and we have in place rigorous frameworks such as a whistleblowing policy to embed high standards of corporate governance in the College.
"Staff, students, and external parties have avenues for confidential reporting of any matters of concern, and a feedback process ensures they receive feedback on any action taken."
When it comes to fostering psychological safety, Dr Venka highlights the importance of organisations developing policies that befit their workplace culture and environment, and specifically address how feedback is obtained, managed, and followed up.
READ MORE: When identity can be faked: Deepfakes, voice cloning & the legal risks implicating workplaces
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