Job stress costs U.S. industries nearly $300 billion a year in absenteeism, employee turnover, diminished productivity and medical, legal and insurance fees, according to the American Institute of Stress. So it's no wonder many companies provide employees with such perks as telecommuting, flexible work schedules, onsite health and fitness centers, even health insurance for their pets. They can't afford not to.

And psychologists are helping these organizations figure out how to cost-effectively keep employees healthy and performing at their best-not just by reducing work stress, but by guiding companies to think more holistically about the ways their workplace practices affect physical and mental health, says Matthew J. Grawitch, PhD, primary research consultant for APA's Psychologically Healthy Workplace Award program and lead author of a recent workplace study review-published last summer in the Consulting Psychology Journal: Practice and Research (Vol. 58, No. 3, pages 129-147)-indicating that Americans relate nearly a quarter of their life satisfaction to their job happiness.

"The whole concept of a psychologically healthy workplace emphasizes the interplay between the organization and the employees, and recognizes that there are going to be some benefits and some costs associated with every kind of program that is put in place," notes Grawitch, chair of the organizational studies program at St. Louis University.

These days, organizations are abandoning the "keeping up with the Joneses" philosophy on employee benefits in favor of a more comprehensive approach to employee well-being. The payoff, say psychologists, comes in the form of healthier and more productive workers, and a boost to an organization's bottom line. The trend, they say, also brings a larger appreciation for the skills psychologists bring to the workplace.

A multi-tiered approach

While the notion of a healthy workplace has evolved over the past 60 years, research from as far back as 1990 suggests a strong link between healthy workplace practices and organizational improvement. In fact, says Grawitch, in designing the awards program, APA reviewed research by psychologists and others and identified five categories of employer practices that foster both employee well-being and organizational performance:

  • Employee involvement: Empowering employees by involving them in decision-making and giving them more job autonomy.

  • Work-life balance: Offering employees flexible work scheduling and other benefits that help them manage the demands they face both inside and outside of work.

  • Employee growth and development: Providing opportunities for continuing education, tuition reimbursement and leadership development.

  • Health and safety: Providing benefits that help employees optimize their physical and mental health and develop healthy lifestyles, such as stress-management, weight-loss and smoking-cessation programs.

  • Employee recognition: Rewarding employees both monetarily and non-monetarily through performance-based bonuses and pay increases, profit-sharing, employee awards programs and simple but genuine expressions of thanks.

Research has shown that these practices, especially when combined, relate to positive trends in employee job satisfaction, organizational commitment and morale.

"Organizations are starting to understand that simple interventions when a problem arises don't work, and that truly improving the health of a workplace is more complex and long term, and must be built into the culture," says David Munz, PhD, an organizational psychologist and professor of psychology at St. Louis University.

Leveraging expertise

A number of progressive companies, for example, provide employees with free gym memberships or build onsite fitness centers, at an employee's suggestion. Some even provide employees' families with gym discounts. Programs such as these, Grawitch notes, encompass employee involvement, health and safety and work-life balance. Psychologists are even showing some companies how to expand this type of benefit into an employee recognition tool by rewarding employees who lose the most weight each quarter, or featuring employees who recently quit smoking in the company newsletter.

Employers haven't always viewed such programs as necessary. But as research repeatedly demonstrates their value, organizations increasingly turn to psychologists for help in everything from teaching employees good communication skills to researching the effects of on-site yoga classes on employee absenteeism, says Lou Perrott, PhD, chair of APA's Business of Practice Network Steering Committee.

"It's a new enough area that psychologists are just evolving ways to adapt their skills to the workplace-there's not a ready-made opening," he says. "We need to make psychologists more aware of the potential that exists for them in helping organizations improve worker health."

El Nuevo Dia

Interested in attending lunchtime talks on improving family health? How about subsidized onsite after-school day care? For offering such benefits, El Nuevo Dia, a newspaper company in San Juan, Puerto Rico, accepts top honors in March as one of six winners of APA's National Psychologically Healthy Workplace Award (see "APA honors 2007 Psychologically Healthy Workplace Award winners"). The organization applied for a local award in 2006 at the encouragement of Ivonne Moreno-Velazquez, PhD, past-president of the Asociación de Psicologia de Puerto Rico (APPR).

"When you walk into an organization that has a psychologically healthy workplace, you can feel it," says Moreno-Velazquez. "El Nuevo Dia is a great example of an organization that is really looking out for its employees, and will hopefully inspire other companies in Puerto Rico to re-evaluate the health of their organizations and develop initiatives to improve it as well."

In 2004, to encourage the spread of holistically healthy workplaces in her territory, Moreno-Velazquez, a psychology professor at the University of Puerto Rico, founded the student group Healthy Organization Workgroup (HOW).

HOW serves students looking to gain real-life experience in healthy workplace development, and is working to revamp the commonwealth's perspective on the value of employee health. To get a handle on the region's workplace problems, students are collecting statistics on, for example, work-related accidents and illnesses in Latin America and Puerto Rico. The group also holds free workshops for local employers on how to build a psychologically healthy workplace. In addition, the group helps run APPR's territorial-level Psychologically Healthy Workplace Award program.

Moreno-Velazquez also leads local workshops on how to evaluate the impact of employee wellness programs. She teaches employers how to measure a program's effectiveness in terms of impact on worker health, productivity and retention.

"Some organizations cannot see the economic impact of these practices...because they don't measure it," she says. "We have to show organizations that building psychologically healthy workplaces is the smart thing to do, and is a matter of productivity and social responsibility."