Introduction
Organisational change is a useful process within an organisation and can lead to improved practices and procedures. However, it tends to occur to a greater extent during periods of recession or economic turmoil. Regardless as to when it occurs, it is useful to explore the impacts of these changes on occupational safety and health (OSH). This article examines the relationship between various organisational practices (such as, lean production, downsizing and resizing, globalisation, outsourcing, continuous improvement, and process reengineering), and how they affect psychosocial risks in the workplace. In addition, the implications for workers’ health and wellbeing are outlined and discussed.
Defining organisational change and practices
Organisational change refers to companies or organisations altering their structures, strategies, procedures or cultures through measures such as downsizing, restructuring, outsourcing and mergers[1]. Organisational change involves a shift from one state to another. This shift may be deliberate and aimed at achieving specific goals, or it may be unintended and arise from external developments[2]. As it introduces novelty, uncertainty and potential disruption, organisational change can be viewed as both an opportunity and a risk. It may also involve redesigning tasks and responsibilities, thereby reshaping the content of work and the work environment in both expected and unexpected ways.
Organisational change has become the norm rather than the exception. Due to mergers and acquisitions, at the national and international levels (as well as spin-offs) it is not uncommon for workers to experience major organisational change during their working career. These dynamic change processes are seen to occur for three main reasons: globalisation; constant technological developments; and the economic climate. These external changes make it difficult for any organisation not to resort to internal changes to keep pace in maintaining or attempting to maintain a competitive advantage[3].
The ways that organisations choose to carry out change is affected by their inherent principles that emerge based on their cultures. For example, organisational work practices that are implemented, inclusive of those carried out during organisational change, tend to influence the development and sustainability of an organisation’s culture[4]. In turn, the cyclical element of this process is obvious as organisational culture may, in turn, influence how organisational change is implemented. Moreover, organisations with a strong safety culture (i.e. wherein safety is the dominant characteristic of the corporate culture) are more likely to consider the impact of safety during organisational change[5].
Organisational change encompasses many different concepts, but this overview considers the impact of organisational change on psychosocial risks at work. In the following the main terms in relation to this are defined:
Business process re-engineering refers to the redefinition of business organisation, its systems and practices for those processes central to the goals of the customer and the organisation[6].
Continuous improvement ensures that organisations are systematic and innovative in their approach to meeting business needs by continuously improving. It arose from the Total Quality Management (TQM) principle, which is an on-going process that ensures senior managers do whatever is required to enable the workers within an organisation to have the necessary resources to establish and achieve the obligatory standards to meet or exceed the customer’s expectations[7]. It requires customer focus, continuous improvement and teamwork, which are achieved through established practices and techniques[3].
Downsizing occurs when an organisation reduces the number of workers within the business to reduce costs. It can occur through voluntary schemes, such as early retirement; involuntary dismissals (e.g. layoffs) and the displacement of workers through outsourcing[8].
Globalisation describes the growing interdependence of the world’s economies, cultures, and populations, brought about by cross-border trade in goods and services, technology, and flows of investment, people, and information[9]. It allows organisations to expand their markets by working across different countries, but it also comes with certain risks making the company and its business more vulnerable towards globalisation-specific changes such as increased taxes.
Lean production is seen as challenging to define due to the different perceptions of what it should entail[10]. It has been linked to just-in-time practices, resource reduction, improvement strategies, standardisation, scientific management and human relations management, but these do depend on who is evaluating the concept and the reason for this evaluation10. One perception of the term has, is existing at both the strategic level i.e. thinking of and offering value and at the operational level, i.e., getting rid of waste, within organisations[11].
Outsourcing/contracting out involves the purchasing of services from external companies that were undertaken previously by workers of the purchasing organisation[6].
Resizing is considered a more strategic organisational process to allow it to meet its strategic objectives, and, therefore, is seen as less punitive than downsizing. It allows senior management to restructure the organisation to make it more agile, flexible, and proactive; and while it may involve job cuts, it adjusts resources and implements strategic shifts to obtain gains from the constant changing global work environment[8].
Digitalisation: The emergence of technologies such as artificial intelligence (AI), big data, collaborative robotics, the internet of things, algorithms, digital labour platforms and, the possibility to work remotely can imply important changes in how companies organise their work processes. These come with advantages and challenges in terms of OSH and psychosocial risks at work[12].
The goal of organisational change is typically to improve competitiveness and organisational efficiency, and, hence, psychosocial OSH risks are rarely integrated in the planning and implementing phases.
Linking organisational change processes with psychosocial issues
With any change process, there is the potential for psychosocial risks to arise. Psychosocial risks can be defined as “aspects of the design and management of work, and its social and organisational contexts, that have the potential for causing psychological or physical harm”[13].
Several studies[1] [2] [14] [15] [16] have found an association between organisational changes and an increase in psychosocial risks, such as:
- increased job demands. This may be because workers are faced with additional, change-related tasks on top of their usual duties and responsibilities;
- reduced job control;
- reduced role clarity and increased role conflict: a restructuring process often involves redefining and rearranging workers' tasks and responsibilities. Ensuring that these do not conflict with existing/remaining ones is essential;
- a poor social climate and less support from colleagues and managers: changes to teams, such as losing colleagues or being introduced to new colleagues, competing for the same positions or having a new superior, may affect an organisation's social cohesion and its workers' ability to provide support;
- increased risk of workplace bullying;
- less promotion opportunities and increased uncertainty; and
- job insecurity.
Impact on workers and organisations
Any change, through its nature, will have some sort of impact (either positive or negative) on workers, as well as on the organisation. Results from the European Working Conditions Survey (EWCS 2024) show that 15% of the respondents expect an undesirable change in their work situation without losing their job leading to uncertainty about their future and prospects. Higher levels of uncertainty were reported by workers in agriculture, health, and transport[17].
Frequent organisational change that seems not to have a finite end may cause workers to become ‘change-weary’, cynical, and lose energy and commitment for their work[18]. These lethargic outcomes may be reflected also in ‘survivors’ syndrome’. Research has reflected the heavy emotional and physical toll that occurs with workers who survive job reductions and are categorised as experiencing ‘survivors’ syndrome’[18]. Survivors’ syndrome could result in decreased management credibility, decreased worker morale, increased absenteeism, and increased turnover[18].
Another consequence of poorly managed change within an organisation is a lower belief in the ‘psychological contract’. The psychological contract is an ‘invisible’ contract, which workers have accepted traditionally as an agreement by management to safeguard workers’ wellbeing and job security[18]. In turn, organisations expect commitment and productivity from workers. Research shows that breaching the psychological contract consistently has negative consequences for workers' attitudes and behaviours, as well as for work-related outcomes such as job performance[19].
Resizing and organisational downsizing have been shown to have a strong negative impact on organisational effectiveness and worker wellbeing[5] [7] [8] [10]. They are linked to higher levels of work exhaustion, greater difficulty detaching from work, higher turnover intentions, and lower levels of job satisfaction, organisational commitment, dedication and both physical and mental health[15]. Organisational effectiveness may also be influenced by role ambiguity, as a result of resizing[11]. Further, resizing can lower the self-esteem and sense of fairness that workers may feel. For example, while workers may justify the loss of a colleague’s job due to poor performance, with such perceptions based on, e.g. him/her being constantly late for work or failing to meet production standards, it is more difficult for them to justify the loss of jobs that occur among productive and diligent colleagues, due to an economic downturn[11]. Resizing may increase worker stress as they may ruminate about the job, and are unable, therefore to detach from the job and thereby recover; while a high degree of pressure combined with a perceived lack of control will cause high anxiety[11]. Stress can in turn affect wellbeing, especially as workers surviving a transition have been found to: increase their drug and alcohol intake; to have trouble falling asleep at night; to experience headaches and back pain; to start smoking after having stopped; and to have increased tension and conflict at home and on the job[11]. Exposure to downsizing has also been associated with increased use of sedatives and other anti-anxiety medication before the event among those who leave, and especially afterwards among those who remain in the organisation[20]. Moreover, the implementation of resizing and the way it is managed could impact negatively on the regard and respect that workers have for their organisations and leaders[10] [21] [2].
More broadly, organisational change can lead to emotional exhaustion, poorer self-rated health[22] [1], elevated stress experience, and deteriorating mental well-being. A large study of 25,977 French workers[23] found that around 60% had experienced at least one organisational change in the previous year, and that such exposure significantly increased the risk of depression. The likelihood of depression also rose with the number of changes experienced[23]. These adverse effects often manifest in increased sickness absence[24] [25], which can further harm organisational performance.
Good practice and prevention
Workers are an integral part of organisations, but healthy human capital is rarely assessed as an organisational investment[26]. For example, the full impact of change on workers safety, health and wellbeing is rarely considered, especially during organisational change processes, and, as shown above, such changes could negatively impact both the worker and the organisation. It is useful therefore for organisations to consider how best to reduce any potential adverse effects on workers. Some of the ways in which this could be achieved are presented below.
Risk assessment
Employers in the European Union (EU) are required to evaluate the risks to the safety and health of workers and to take the appropriate action to prevent or control those risks, as outlined in the Framework Directive 89/391/EEC[27]. This risk assessment includes the assessment of psychosocial risks to workers’ health which is especially important when undergoing an organisational change process.
Managing the change process
During organisational change, employers should invest in ensuring that the change is occurring in an open, transparent and safe manner. Workers should be well informed and consulted on the planned changes and should be given the option to raise their concerns, for example through worker or trade union representatives.
The following points include issues that should be addressed to ensure that psychosocial risks are considered as part of the change process.
Integrating health and safety issues
Organisations should ensure that: 1) the change is an opportunity for improving psychosocial risks, and that 2) psychosocial risks due to unforeseen effects of changes are minimised[6]. One of the ways this could be achieved is by reviewing and measuring health and safety performance both during and after the change process to identify any unexpected trends and develop any required actions by[6]:
- Formulating a clear set of safety and health objectives in respect of the change process.
- Demonstrating the commitment of senior management to the recognition, assessment and management of safety and health issues and especially psychosocial aspects arising from reorganisation.
- Reinforcing commitment by a pattern of consistent decision making and communication.
- Recognising the potential impacts on safety, health and wellbeing at a sufficiently early stage to allow the completion of any required assessment and the identification of any appropriate actions.
- Defining the terms of the review before the change process plans have been formulated
Consultation and participation
Involvement of workers in the change process is crucial. By putting in place a consultation plan that includes details of how the consultation process will be implemented and how the results will be provided to workers, the organisation can ensure that workers are involved from the initial stages onwards[28]. Examples of actions include[28] [29]:
- Make sure that workers are consulted about organisational changes, and at all times respect the legal rights of workers and trade union representatives;
- Ensure managers have been informed about the consultation plan;
- Make sure that all managers have personally communicated the changes to their workers, explaining how they are relevant to their roles;
- Identify and inform workers that are impacted by change;
- Provide opportunities for workers to participate in the change process, e.g. provide information and organise meetings, discussions, feedback sessions with individuals and work teams to give workers the opportunity to raise any concerns;
- Ensure that workers have sufficient time to consider and respond to any proposals; and
- Feed back the results of the consultations to the relevant group or individuals and explain why it was not possible to implement some of the ideas.
Trust and transparency
Maintaining open communication and transparency helps ensure that workers feel informed, supported, and connected during periods of uncertainty. This is particularly important when considering the possibility of workers losing their jobs. It's better to be transparent, even when managers have to share bad news or uncertainty. In the context of digitalisation, this means fostering a relationship built on trust by clearly explaining how new digital systems, tools, and algorithms work. Organisations need to be transparent about the purpose of these technologies, the decisions they influence, and the types of data they collect. On this topic, the EU has issued the Artificial Intelligence Act (Regulation 2024/1689/EU) in 2024[30]. Its purpose is to rule the use and development of AI systems in the European Union, trying to guarantee that it is used in an ethic, safe and responsible way, protecting the fundamental rights and the safety of the European citizens. The AI act will be implemented in all sectors and will also influence OSH[31] [32].
Role of line managers
Line managers need to be supportive of the change process but should also be able to give support to their teams. As such, for line managers taking part in the change process, this will mean[3]:
- Working with champions at all levels, i.e. senior managers within organisations who are responsible for promoting any specific change process.
- Being involved in working groups at all levels - gain involvement.
- Breaking the change project down into bite-sized chunks.
- Integrating the change into staff’s personal objectives.
- Demonstrating the future - see it/touch it (not just relying on statistics).
- Selling the positives to their team with enthusiasm.
- Seeking ideas from all concerned.
- Moving from a one-way ‘telling and selling’ exercise to using genuine two-way communication.
- Creating a team vision for change.
Therefore, all managers should receive communication skills training to encourage transparency, facilitate dialogue and handle uncertainty effectively. This will enable them to support and guide the change process in a participatory manner, actively involving workers. They should also be trained to recognise the early signs of psychosocial problems and intervene promptly when issues arise.
Support
Policies and procedures should be in place to support workers during the changes and allow early intervention. Managers as well as workers should know how to access and use these support structures.
Investing in skills and training
Organisational change, particularly the introduction of new technologies and digitalisation, has an impact on jobs, skills, and workloads. New skills may be required to use and maintain digital tools but also skills may be lost as a result of automation[33]. To build confidence and improve competence, as well as ensuring that existing knowledge and expertise are maintained, workers should be offered targeted training in new technologies, digital tools and updated work processes, alongside continuous learning opportunities.
Conclusions
Organisational change is needed if organisations are to survive and maintain their competitive edge. However, the ways in which these are undertaken should be carefully considered at senior management level, due to the negative impact they may have on both workers and the organisation. Further, OSH systems should be reviewed at the same time as when other corporate systems are being reviewed in anticipation of any change, to ensure that any potential OSH risks, including psychosocial risks are identified.
