A report on mental health reforms suggests workers’ compensation premiums be set according to how well a workplace meets an agreed set of benchmarks.

“This trial intervention incentivises workplaces to improve their psychosocial risk profile by adopting a risk-based approach to mental health premiums within industries, as well as across industries,” the KPMG paper says. “There is potential for this intervention to be a ‘win-win’ for employers in reducing tax burden and improving workforce productivity.”

The proposal has no precedent in Australia but is aligned with government policies at state and federal levels to improve workplace mental health and wellbeing, KPMG says.

The suggestion is one of many in the report, called Investing to Save.

Mental health-related illnesses cost the economy $60 billion a year and one in five Australians has poor mental health at any time.