Every workplace has hazards. Some are obvious like wet floors or heavy machinery. Others hide in plain sight until someone gets hurt. Without a clear system to identify and manage these dangers, you’re gambling with people’s safety and your business’s future. The consequences can be severe. Injuries cause pain and lost time. Legal penalties hurt your finances. Damaged reputation drives away customers and talent.
Risk assessment gives you a proven method to spot hazards before they cause harm. It’s not about creating paperwork. It’s about systematically looking at what could go wrong, understanding who might be affected, and putting practical controls in place. This process protects your people while helping you meet legal obligations under Australian health and safety legislation.
This guide walks you through the complete risk assessment process. You’ll learn what risk assessment is and why it matters to your business. We’ll break down each step from identifying hazards to reviewing your controls. You’ll also see practical examples that show how to apply these principles in real situations. By the end, you’ll know exactly how to create a safer workplace.
What risk assessment is and why it matters
A risk assessment is a systematic examination of your workplace to identify what could cause harm to people. You look at your work activities, equipment, substances, and environment to spot potential dangers. Then you evaluate how likely each hazard is to cause harm and how serious that harm might be. This process helps you decide which risks need urgent attention and what controls you should put in place.
The legal foundation in Australia
Australian law makes risk assessment mandatory for employers and self-employed people. The Work Health and Safety Act requires you to identify hazards, assess risks, and implement control measures to eliminate or minimise those risks. State and territory regulators enforce these requirements across the country. If you fail to conduct proper risk assessments, you face significant penalties including fines and potential criminal charges. Beyond avoiding punishment, these legal obligations exist to protect the people who work for you and anyone else who might be affected by your business activities.
Business benefits beyond compliance
The importance of risk assessment extends far beyond meeting legal requirements. Well-executed assessments protect your business from financial losses that come with workplace injuries and incidents. You avoid compensation claims, lost productivity, and the costs of replacing injured workers. Your insurance premiums often decrease when you demonstrate strong safety practices. Risk assessments also help you allocate resources efficiently by showing you where to focus your safety budget and effort.
When you identify and control risks proactively, you create a safer work environment that protects both your people and your business operations.
Building a culture of safety delivers measurable returns. Employees feel valued when you take their safety seriously, which improves morale and retention. You spend less time dealing with accidents and more time running your business. Your reputation strengthens when clients and partners see your commitment to safety standards. Research shows that businesses with effective risk management systems experience fewer disruptions to their operations and maintain more consistent productivity. These practical benefits make risk assessment a valuable investment rather than just a compliance exercise.
Step 1. Identify hazards and who could be harmed
The first step in any risk assessment starts with identifying hazards in your workplace. You need to walk through your entire workplace and examine every activity, piece of equipment, substance, and process that could potentially harm someone. This isn’t about guessing or relying on assumptions. You gather real information by observing work being done, talking to your workers, and reviewing incident records. Document everything you find because these hazards form the foundation of your entire risk assessment.
Common hazard categories to check
Hazards come in many forms across different workplaces. You can organise your search by looking at five main categories that cover most situations. Physical hazards include things like machinery, electricity, heights, noise, and temperature extremes. Chemical hazards cover any substances that could harm health through contact, inhalation, or ingestion. Biological hazards involve bacteria, viruses, moulds, and other organisms. Ergonomic hazards relate to how work is designed, including repetitive movements, awkward postures, and manual handling. Psychosocial hazards affect mental health through factors like high workload, poor support, or workplace violence.
Look systematically through each category relevant to your operations. Manufacturing environments typically face physical and chemical risks. Office settings often deal with ergonomic and psychosocial factors. Healthcare workplaces encounter biological hazards alongside physical risks. Your specific industry determines which categories need the most attention.
Methods for identifying hazards
Start by walking your workplace and observing operations as they actually happen. Watch workers perform their regular tasks instead of relying on written procedures alone. Equipment that looks safe on paper might create hazards in real use. Inspect work areas during different shifts and times because hazards can vary throughout the day.
Consult with your workers directly. They know the job better than anyone and often spot hazards that aren’t obvious to managers. Hold conversations, run safety meetings, or use anonymous suggestion systems to gather input. Review your accident and injury records to identify patterns. Past incidents reveal hazards you might otherwise miss.
When you involve workers in hazard identification, you tap into their daily experience and create stronger buy-in for safety improvements.
Check manufacturers’ safety data sheets for any substances you use. Read operating manuals for equipment. These documents highlight specific dangers associated with products and machinery. Compare your workplace against industry guidelines and codes of practice to spot gaps in your current setup.
Identifying who might be harmed
After finding hazards, you determine who could be affected by each one. List groups of people rather than naming individuals. Your employees are the obvious first group, but you need to think broader. Contractors, visitors, customers, delivery drivers, and maintenance workers all enter your workplace. Members of the public nearby might be affected by your operations. Certain groups face higher risks and need special consideration.
Young workers, pregnant employees, people with disabilities, and those new to their role often have increased vulnerability to specific hazards. Note these groups against relevant hazards so you can design appropriate controls later. This step ensures your risk assessment covers everyone who could possibly be harmed by your business activities.
Step 2. Assess risks and decide on priorities
Once you’ve identified hazards and who might be harmed, you need to evaluate each risk to understand its significance. This step involves looking at two key factors: how likely the harm is to occur and how severe the consequences would be if it did happen. You analyse each hazard against these criteria to produce a risk rating that helps you decide which problems need immediate attention and which ones you can address over a longer timeframe.
Understanding likelihood and severity
Likelihood refers to the probability that exposure to a hazard will actually result in harm. You consider factors like how often people are exposed to the hazard, how many people are exposed, and whether existing safety measures reduce the chance of incidents. A chemical stored in a locked cupboard accessed once per month presents lower likelihood than one used hourly on an open workbench. Duration and frequency of exposure play crucial roles in determining likelihood ratings.
Severity measures the potential consequences if harm occurs. You think about the worst realistic outcome, not just minor possibilities. Could the hazard cause a fatal injury, permanent disability, serious injury requiring hospitalisation, minor injury needing first aid, or just discomfort? The importance of risk assessment becomes clear when you realise that even low-likelihood events deserve serious attention if their severity is high. A piece of equipment might rarely malfunction, but if that malfunction could kill someone, you treat it as a priority risk.
Using a risk matrix
Risk matrices provide a practical tool for combining likelihood and severity into a single risk rating. You create a simple grid where one axis shows likelihood levels and the other shows severity levels. Each cell in the grid represents a different risk level, typically colour-coded for quick reference.
| Severity → | Minor | Moderate | Major | Catastrophic |
|---|---|---|---|---|
| Almost Certain | Medium | High | Extreme | Extreme |
| Likely | Medium | Medium | High | Extreme |
| Possible | Low | Medium | High | Extreme |
| Unlikely | Low | Low | Medium | High |
| Rare | Low | Low | Medium | High |
You assess each identified hazard and place it in the appropriate cell. This visual approach helps you see at a glance which risks demand immediate action. The matrix works best when you define what each term means for your specific workplace. "Almost certain" might mean something different in a chemical plant versus an office environment.
Document your risk ratings systematically so you can track changes over time and demonstrate your reasoning to regulators or auditors.
Prioritising your actions
After rating all risks, you create an action plan based on the results. Extreme risks require immediate action before work continues. You might need to stop certain activities until you implement controls. High risks need urgent attention with actions scheduled within days or weeks. Medium risks demand planned improvements within a reasonable timeframe, while low risks might only need periodic monitoring.
Consider your available resources when setting priorities. You can’t fix everything simultaneously, but you must address the most serious risks first regardless of cost. Focus your immediate efforts on situations where severe harm is likely or where catastrophic harm is possible. This structured approach ensures you spend your safety budget where it delivers the most protection for your workers.
Step 3. Control risks with effective measures
After you’ve identified hazards and assessed their risks, you implement control measures to eliminate or minimise those risks. This step transforms your risk assessment from a paper exercise into real workplace protection. You work through a structured approach called the hierarchy of controls, which ranks methods from most effective to least effective. Australian WHS regulations require you to work down this hierarchy, starting with the most protective options and only moving to lower levels when higher controls aren’t reasonably practicable.
The hierarchy of controls explained
The hierarchy consists of five levels that guide your control selection. Elimination sits at the top as the most effective option. You remove the hazard completely so no risk exists. Substitution replaces a hazardous item with something less dangerous. Engineering controls isolate people from hazards through physical changes to the workplace. Administrative controls change how people work through procedures, training, and work schedules. Personal protective equipment (PPE) provides the lowest level of protection as the last line of defence.
Understanding this hierarchy proves critical to effective risk management because each level offers different degrees of protection and reliability. Higher-level controls work automatically without depending on human behaviour. Lower levels require constant supervision and worker compliance, making them less dependable over time.
You must always aim for the highest level of control that’s reasonably practicable, considering the likelihood of harm, potential severity, available knowledge, and implementation costs.
Implementing elimination and substitution
Elimination removes the hazard entirely from your workplace. You might redesign a process to avoid using a dangerous chemical, automate a task to remove manual handling, or change your building layout to prevent vehicle-pedestrian interactions. When renovating offices, you eliminate fall risks by doing work when the building is empty rather than having contractors work around employees. This approach delivers complete protection because the hazard no longer exists.
Substitution replaces hazardous materials or processes with safer alternatives. You switch from a toxic cleaning chemical to a non-toxic product, replace noisy equipment with quieter models, or use prefabricated components instead of cutting materials on-site. A printing business might substitute solvent-based inks with water-based alternatives, eliminating inhalation risks while maintaining product quality. Check manufacturer specifications and safety data sheets to verify that substitutes genuinely reduce risk rather than introducing new hazards.
Engineering and administrative controls
Engineering controls create physical barriers between workers and hazards. You install machine guards around moving parts, add ventilation systems to remove airborne contaminants, or use conveyors to eliminate manual lifting. Guardrails prevent falls, sound-dampening enclosures reduce noise exposure, and automated systems minimise human contact with dangerous processes. These modifications work continuously without requiring worker action, making them highly reliable.
Administrative controls manage how and when work occurs. You develop safe work procedures, implement permit systems for high-risk tasks, rotate staff to limit exposure duration, and provide comprehensive training. Warning signs alert people to hazards, scheduled maintenance prevents equipment failures, and supervision ensures procedures get followed. A warehouse might implement a one-way traffic system and designated pedestrian walkways to separate forklifts from workers. Document all administrative controls clearly and train every affected person on the requirements.
Using PPE as a last resort
PPE includes items like safety glasses, gloves, hearing protection, respirators, and hard hats that workers wear for protection. You implement PPE only after exhausting higher-level controls or as an interim measure while you develop better solutions. The importance of risk assessment becomes evident here because PPE fails when workers don’t use it correctly, equipment isn’t maintained properly, or protection proves inadequate for the actual hazard.
Select PPE that matches the specific risk you’re controlling. Consult Australian Standards for guidance on appropriate specifications. Provide fitting services to ensure proper sizing, train workers on correct use and maintenance, and establish replacement schedules. Conduct regular checks to verify compliance. A construction site might require hard hats, safety boots, and high-visibility clothing as baseline PPE, with additional respirators and harnesses for specific tasks where engineering controls can’t eliminate all risks.
Step 4. Review controls and keep improving
Risk assessment isn’t a one-time task you complete and file away. You establish a continuous cycle of monitoring, reviewing, and improving your controls to maintain workplace safety. Your workplace changes constantly through new equipment, different work methods, staff turnover, and evolving business activities. Each change potentially introduces new hazards or makes existing controls less effective. Regular reviews ensure your risk management system stays relevant and protective as your operations develop.
When to review your risk assessments
Schedule formal reviews at planned intervals appropriate to your risk levels. High-risk activities might need monthly checks while stable, low-risk operations could manage with annual reviews. You trigger immediate reviews whenever significant changes occur in your workplace. New machinery, altered processes, different chemicals, workplace relocations, or organisational restructuring all demand fresh assessment. Incident investigation provides another critical trigger for review. After any accident, injury, near miss, or illness event, you examine the relevant risk assessment to understand what failed and what needs strengthening.
Track these review triggers systematically:
- After introducing new equipment, substances, or procedures
- Following workplace accidents, injuries, or near misses
- When workers report new hazards or problems with controls
- After changes to legislation or industry standards
- When audit findings identify gaps or weaknesses
- At predetermined intervals based on risk levels
Your risk assessments must reflect current workplace conditions, not historical situations that no longer apply.
Conducting effective reviews
Walk through your workplace using the original risk assessment as your checklist. Verify that implemented controls still exist and function as intended. Machine guards get removed during maintenance and never replaced. Warning signs fade or disappear. Administrative procedures drift as informal shortcuts develop. Observe actual work practices rather than assuming procedures get followed. Talk with workers to understand practical problems with current controls that might not be obvious from observation alone.
Check whether your risk ratings remain accurate. Controls you implemented might have reduced the actual risk below your original assessment, or new factors might have increased it. Document any gaps between your risk assessment and current reality. The importance of risk assessment lies in its ability to drive real improvements, which only happens when you act on review findings.
Recording changes and updates
Document every review with clear records showing the date, who conducted it, what you found, and what actions you took. Update your written risk assessments to reflect any changes in hazards, risk levels, or control measures. Version control helps you track how your risk management evolves over time. Sign and date each revision, keeping previous versions for reference.
Communicate updates to everyone affected by the changes. Brief workers on new controls, modified procedures, or additional precautions. Your review process creates opportunities to reinforce safety messages and maintain awareness across your workforce. Store all documentation systematically so you can demonstrate your ongoing commitment to safety improvement.
Key takeaways
The importance of risk assessment extends beyond compliance into protecting your people and business operations. You now understand the four-step process: identify hazards and who might be harmed, assess risks to set priorities, implement controls using the hierarchy, and review your measures regularly. Each step builds on the previous one to create a systematic approach that delivers real workplace protection.
Start your risk assessment immediately by walking your workplace and talking with your workers. Document what you find, rate the risks, and implement controls beginning with the highest-priority hazards. Review your assessments whenever changes occur or at scheduled intervals to maintain their effectiveness.
Your business operations depend on managing risks across all areas, from workplace safety to protecting your commercial vehicles and fleet. National Cover provides comprehensive insurance solutions that complement your risk management strategy, keeping your business protected while you focus on creating safer operations.
