How to create a mental health policy in a small business


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If you have recently hired your first employee or already have a growing team, you might be thinking about introducing a mental health policy or improving an existing one. Implementing such a policy shows that you value your employees’ wellbeing, and it can help promote higher engagement levels, attract and retain new hires, and build a stronger, more positive brand image.

In this article, one of the UK’s leading company formation agents, Rapid Formations, explores how small businesses can create a mental health policy in their organisations. They highlight the lawful considerations around mental health for employers and cover a range of methods to help small businesses introduce an effective policy.

Know the law around mental health

First, let’s take a look at the law around mental health to ensure that your policy meets the legal requirements for mental health at work.

ACAS explains that employers have a duty of care to support their employees’ health, safety, and wellbeing. This means you must create a safe working environment, protect staff from discrimination, and carry out regular risk assessments. This law refers to mental health as much as it does physical health.

In addition, the Equality Act 2010 explains that poor mental health could be considered a disability “if the impairment has a substantial and long-term adverse effect on [a person’s] ability to carry out normal day-to-day activities”. For example, this could include difficulties with time management, meeting deadlines, or interacting with colleagues.

In this case, you should support employees by making reasonable adjustments to their working arrangements where required. For example, allowing flexible working hours, permitting regular breaks, or helping them manage their workload.

Particularly in the case of mental health, remember that not all disability symptoms are visible. Therefore, when creating a policy, you should encourage safe communication and provide staff with the tools to seek the support they need from you as their employer.

For more information and guidance on mental health law for businesses, visit the ACAS website or refer to the Equality Act 2010.

Creating a mental health policy

Every company is different. You’ll have your own values, priorities, and resources, which will likely differ from other businesses. That’s why there’s no specific mental health policy structure to follow. You should take the time to evaluate what’s important to you and your team and create a meaningful process based on mutual objectives.

Below are some techniques you might find useful in creating your first mental health policy and the sections you may wish to include in your document.

Speak to your employees

For the most effective mental health policy, you should understand what matters to your team. After all, the purpose of the policy is to encourage a positive, open, and supportive culture.

So, in the first instance, we suggest speaking to your employees and finding out what support they might need from you. This way, you’ll create a purposeful mental health policy and demonstrate that you value their input and are committed to supporting their wellbeing.

In a small team, it might be useful to simply start an open discussion. However, given the sensitive nature of the topic, people may prefer more private or anonymous means. Therefore, you should facilitate a variety of communication methods that everyone can be comfortable with.

And remember that your first mental health policy won’t be set in stone and will require continuous updating and reviewing, so be sure to give people ongoing opportunities to bring their ideas to the table.

Understand general responsibilities

Implementing a mental health policy is a team effort and everyone in the business has a role to play in its effectiveness. To put a solid policy into action, all key stakeholders should be on board and understand their responsibilities in delivering successful mental health practices. The policy document itself should also include a breakdown of everyone’s input.

Firstly, the HR team (if you have one) should guide and support employees and managers through mental health issues and the organisation’s processes. Generally, they are also in charge of sharing and maintaining the mental health policy and ensuring that the organisation is kept up to date with any changes.

If you don’t have an HR team or representative just yet, these duties should be shared between other leaders in the business, including yourself.

Secondly, senior leaders (such as directors and officers) play a critical role in the implementation of a successful mental health policy. After all, these individuals lead by example and hold the power to drive change in a business. They should also ensure that the policy is fair, accurate, and reliable.

Thirdly, as they work directly with employees, line managers are in a central position to put a mental health policy into action. Regular 1-2-1s and team meetings, for example, are just some methods they can use to do this. When creating a mental health policy, think about the daily responsibilities your line managers should undertake and ensure it is clearly outlined in the document.

Finally, employees. Only they know what support they need and when they need it, so they are responsible for reporting any concerns they might have and doing so in accordance with the mental health policy.

Promote mental wellbeing

The primary aim of a mental health policy is to promote mental wellbeing. Therefore, your policy should clearly outline the processes the business has or will strive to put in place to achieve this.

For example, you could host monthly wellbeing 1-2-1s for all staff with a neutral host. This is someone who isn’t a senior leader or manager, but rather a trusted colleague who people can safely share any concerns or issues with.

Other options are to establish flexible working hours to facilitate a healthier work/life balance, introduce employee healthcare insurance that includes mental health cover, or share regular wellbeing newsletters and learning materials to educate people on how to look after their mental health.

Consider the resources available to your business and how you can help your employees be mentally healthier and express those intentions in your policy statement at the very start of the document.

Reduce work-related stress and anxiety

An important section to cover in your mental health policy concerns stress and anxiety, and what your business will do to reduce this common problem staff.

According to a Mental Health UK report, an overwhelming 91% of adults admit they’ve experienced high or extreme levels of stress in the last 12 months. Furthermore, a fifth of workers say they’ve needed to take time off work due to poor mental health caused by stress, and over 70% of people feel unable to manage the pressure in their lives.

With these staggering figures in mind, it’s clear that employers have an enormous opportunity – and responsibility – to improve the mental health of their staff by having a dedicated policy in place.

In this section, you could explain that the company will conduct regular risk assessments, monitor employees’ working hours, or encourage staff to take advantage of their full annual leave entitlement, for example, to help control and reduce work-related stress.

Explain flexible working rules

If your company offers flexible working arrangements, include the rules on this procedure in your mental health policy. Anything from part-time or temporary work to compressed hours and working from home may constitute flexible working.

In this section, you should express that the company recognises flexible working to help reduce mental health problems in the workplace and improve people’s work/life balance. Explain the flexible working options available to staff and the support available to them.

Provide information and training

Another crucial part of a mental health policy is information and training. Here, you should outline how the company will support staff in staying up to date with the internal policy as well as provide managers and supervisors with ongoing mental health training.

Perhaps they will be encouraged to participate in specialist courses, or the business will provide them with a selection of resources that allow them to apply the mental health policy adequately.

Review and monitor your mental health policy

Finally, highlight how the company will monitor and update its mental health policy. As we mentioned earlier, this document is not set in stone.

Not only will your employees change but practices and laws will change over time, too. Therefore, you’ll need to review your policy regularly to ensure it remains effective and relevant.

Help available for small businesses

It can be tricky to create a mental health policy from scratch – there’s a lot of information to cover. However, there is lots of help available for small businesses doing this for the very first time.

Mind offers step-by-step guidance and best practices for employers and ACAS, which we referenced earlier, is the best source of support and guidance on workplace rights.

To help you get started with your first mental health policy, you may also find templates useful. Just remember to personalise them to your business and values.


Small businesses can support their employees’ wellbeing by implementing a comprehensive mental health policy.

Before getting started, business owners should familiarise themselves with relevant mental health laws and workplace rights. Then, create personalised guidelines for the organisation that promote a positive, supportive, and mentally healthy environment for all.

Rapid Formations is one of the UK’s most popular company formation agents, with over 36,000 business owners using its services every year. Specialising in the incorporation of private limited companies and LLPs, Rapid Formations makes it quick, easy, and affordable for new entrepreneurs to get their new ventures off the ground. 

To start your adventure, explore their registration packages, starting at just £52.99, on the Rapid Formations website. 

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