Mental health in the workplace directly impacts productivity, growth, and overall success of a business. “Poor performance” is the first indication an employee is suffering from a mental health challenge, says Dr. Sam Zand, a Board-certified psychiatrist and founder of Anywhere Clinic, an online portal for mental health services available in 29 states and Washington, D.C.
A person’s mental health impacts everything in life, at home, work, or play.
Small business owners (SBOs) play a huge role in their employees’ lives, not only financially but emotionally, too. And that includes owners and employees in the shed industry.
According to Jillian Amodio, a licensed therapist, writer, and mental health advocate, “An SBO who wants people to show up to work with a good attitude, be loyal, and be productive has to make sure their (employees’) mental and physical health is taken into account. If you don’t offer a supportive place, eventually your workplace will suffer.”
The mental health of employees and their bosses correlates with the success of a small business, she says.
“If an SBO wants the business to grow, they must address modern-day stressors and challenges that impact the business and employees,” sums up Amodio.
Why Mental Health in the Workplace Matters
Joel Steele, chief people officer of E-Impact Marketing, demonstrates his commitment to mental health for both himself and his colleagues through both actions and words.
Mental health should matter to employers, he says. “As an employer, you oversee people. If your mental health or emotional tank is low or depleted, there isn’t much to give to others. I have to be mentally healthy enough to care for my family and (at) work.”
He adds, “From a personal standpoint, when an SBO feels better and not tired, they have zen for the day vs. dread” for it.
A company owner owes a ‘duty of care’ to their staff, says Zand. “The strength of a small business is that we can all look out for each other. (Employees) should be a tight-knit group. If there is tension, a small business cannot succeed. We should care about how each other is and that people feel fulfilled and appreciated.”
Business owners are under constant pressure from customers, potential clients, employees, suppliers, and more. Those stressors can easily contribute to poor mental health, sleeplessness, angst, and other negative results.
That’s why, according to Kim Pierano, an organizational psychologist and business consultant, an SBO would be wise to “make your own health and well-being a priority to show your employees that is what you value. My biggest piece of advice is to really try to walk your talk.”
The Legal Impact of Mental Health in the Workplace
Not only is positive mental health important to overall job and life satisfaction, but employers also have legal responsibilities for their staff’s mental attitudes, says Hunter Seidler, an associate with Barnes & Thornburg.
Sometimes, when bosses get caught up in serving customers and clients, they forget they are also called to serve their employees.
“This isn’t just a moral obligation, either,” says Seidler. “Federal and state employment laws, such as:
- The Americans with Disabilities Act and
- The Family and Medical Leave Act
Each may require an employer to provide certain accommodations or protected leave time in the event an employee has a serious health condition or disability, under penalty of fines or costly lawsuits.
“Additionally, failure to prioritize employee wellness can lead to burnout and impact the productivity of your business. In short, even the most dispassionate employers should care about their employees’ mental health because it could have legal and financial consequences.”
And, notes Steele, “You don’t know how much employees are watching you.” Therefore, an SBO would be wise to model what a healthy work-life balance looks like.
“You can’t chastise an employee for not working overtime, but also promote positive mental health. That is contradictory and hurts the credibility of management and hurts the relationship between the SBO and their employees,” sums up Steele.
Amodio agrees, “‘I don’t care about you as a person’ is not a long-term solution to helping employees feel valued.”
Sign of Poor Mental Health
“Working somewhere that is toxic would be detrimental to the company, employees, and clients/customers, who will feel it,” says Steele.
Indicators to be aware of that demonstrate at least one employee is suffering from depression, anxiety, or other mental health challenges include:
- Poor work attendance
- Tardiness to work
- Intoxication
- Guarded, aggressive, or angry interactions with co-workers and/or customers
- Physical cues, such as avoiding conversation or eye contact
- Leaving early
Small business owners can also unknowingly demonstrate they are not attending to their mental health in several ways.
They include:
- Late paychecks
- Communication issues outside the norm
- An inability to see productivity and acknowledge it
- Narcissism (so stuck on themselves they cannot see anyone else’s production)
- Micromanaging, or the opposite, a demonstrable lack of emotional involvement
An employer’s mental outlook is an essential part of taking care of oneself, says Amodio. According to a 2025 study released by the University of Hong Kong and published by the Wiley Online Library, globally, anxiety disorders and depression are the most common mental ailments. Results of the survey revealed that depression doubles mortality rates and increases suicide risk by 10 times, noting, however, that timely treatment reduces that possibility by up to 30 percent.
What SBOs Can Do to Improve Mental Health in the Workplace
Even if an SBO has never delved into their own mental health status, let alone that of their employees, there is hope, says Zand.
For example, he suggests:
- casual conversations between management and staffers outside of work.
- Timely performance reviews to highlight an employee’s strengths and weaknesses.
- Rewording otherwise negative discussions to prevent employees (anyone) from becoming defensive.
- Begin or continue to encourage employees to use their PTO to meet both their physical and mental needs.
According to Amodio, when an employee witnesses their boss dealing with stress or loss in a constructive manner, trust between the two colleagues is built. That behavior humanizes the SBO and lends the credibility of normalcy to handling life’s numerous challenges.
An SBO who believes their company can’t function without them is a poor example of coping with life.
“Take time off when you need to keep a work-life balance. Listen to your body. If you model taking care of yourself, employees will see you and at least feel they can come to you” with problems, says Amodio.
Steele’s workplace offers “career path” meetings for management and employees to discuss how they feel about the job, the workplace, or anything else of import to the staffer.
“That open dialogue, which is a give-and-take with the employee, is important to their feeling they truly matter to the company,” says Steele.
Other suggestions for improving company morale and engagement include:
- Company-wide potluck dinners
- Group outings to sporting events or other activities, encouraging social interaction
- Team-building exercises such as bowling, playing board games, or even workshops focused on finding humor in the workplace.
“Be engaged and interested in your employees so they feel valued,” says Amodio.
Mental Health in a Multi-Generational Workplace
According to the Brookings Institution, baby boomers (born between 1946 and 1964) comprise nearly one-fifth of the American population. In 2026, the youngest boomers will turn 62, while the oldest will be 80. If a baby boomer mired in the “old ways of doing things” is at the helm of a company, it is also possible that their technological awareness and efficiency are severely lacking.
That unwillingness to adapt to the ever-changing technological and business demands will hurt a company’s bottom line. Time, which is money, gets wasted on menial tasks such as hand-stamping monthly billing statements.
If an SBO is crotchety and inflexible in their business approach, their enterprise will eventually suffer, says Steele.
“Show me the turnover rate between a crotchety boss-run company and one that treats employees with care and consideration,” he challenges.
According to Zand, “People who are rigid are hard to work for and work with. Meanwhile, younger generations need to learn from the older generations about work ethic.” Still, he cautions more experienced generations to be wary of their impact on younger minds.
In a 2026 report issued by Circles, a Sodexo company, loneliness and burnout are two factors contributing to employee depression and distress. According to the study, “The real workplace divide in 2026 isn’t between remote and in-office work. It’s between organizations that offer chaotic flexibility—where every arrangement feels like a negotiation—and those providing structured flexibility, where clear frameworks make autonomy actually sustainable.’
According to the report, burnout rates currently stand at a 10-year high. Entities that proactively reduce work-related stress while supporting employees in managing stress across their daily lives possess a tactical advantage over competitors that do not.
Building a Healthier Workplace Culture
Realistically, some SBOs do not care how people perceive them, says Steele. Positive relationships with employees are not their priority, so they dismiss staffers’ complaints about the workplace or even suggestions for improving the situation.
Such is a recipe for corporate disaster.
“Working somewhere that is toxic would be detrimental to the company, employees, and clients/customers. They will feel it,” says Steele. “Empathy and emotional intelligence are important to one’s mental health. Emotional awareness is important.”
He suggests that company owners ask themselves whether they want to put the time and energy into caring for people.
“I think they should,” he says.
