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Leadership10 min read

Unresolved Conflict Is a Leadership Problem. In Victoria, It's Also a Legal One.

15 May 2026Written by Daniel Halls
Two professionals sitting at opposite ends of a conference table, representing unresolved workplace conflict

Do you remember that feeling from the first blog in this series?

Sweaty palms. Heart pounding. That knot in your stomach before a difficult conversation.

Now imagine feeling that every single day. Not before a conversation you chose to have. But just walking through the door at work. Knowing that today, not if but when, there will be tension. There will be an argument. There will be that familiar wave of dread that follows you from the car park to the desk.

That is what unresolved conflict feels like from inside a team that nobody is leading through it. Is that how you want your people to feel?

Twenty years

I heard about two senior workers recently who have been in conflict for twenty years. Not a cold war. Not occasional tension. Twenty years of unresolved disagreement so embedded that the organisation built its rostering around it. They refuse to work the same shift. Conversations get tense. And every person on that team knows it and carries the weight of it.

Nobody ever addressed it early. Nobody asked the uncomfortable question. And now it is part of the furniture.

I also heard about a consultant brought into a workplace where two co-workers were in a heated verbal argument. When she dug deeper, something else emerged. One worker had a close relationship with a manager. They got away with more. The playing field was not level.

By the time it was resolved, jobs had been reviewed. People moved. One person given an ultimatum. Change your behaviour or find a different role. They left.

What should have been an early conversation became a structural intervention. What could have been addressed in a team meeting required an external consultant, leadership discussions, and organisational restructuring.

That is what unresolved conflict actually costs. And those are just the visible costs. The invisible ones are harder to count: the daily dread, the exhausted team members managing around a toxic dynamic, the good people quietly deciding it is not worth staying. None of that shows up on a spreadsheet.

The rules have changed

Here is something every leader in Victoria needs to know right now.

As of December 2025, the Occupational Health and Safety Psychological Health Regulations 2025 are in effect. Under these regulations, employers have a legal duty to identify, assess, and manage psychosocial hazards in the workplace.

Unresolved conflict is a psychosocial hazard.

The 20-year conflict between two senior workers? Not just a culture problem. A compliance issue. The power imbalance that went unchecked until it exploded? A compliance issue. The leader who knew something was wrong but never asked the uncomfortable question? That is now a leadership liability.

If you are outside Victoria, your jurisdiction may not have caught up yet. But the direction is clear. Psychological safety is no longer a nice to have. It is an enforceable workplace right.

Amy Edmondson's research on psychological safety showed that teams perform best when people feel safe to speak up, take risks, and raise concerns without fear of punishment or humiliation. Unresolved conflict destroys that safety. It does not just affect the two people in conflict. It affects every person who witnesses it, works around it, or stays silent because they have learned that speaking up is not safe here.

This series has been building to this point

Over the past three weeks I have written about why leaders avoid conflict, how to finally have the conversation you keep putting off, and why conflict is just two perspectives waiting for a dialogue.

Week 4 is where the responsibility lands. Because understanding conflict is one thing. Taking action is another.

What early intervention actually looks like

Neither of those stories needed to get where they did.

The 20-year conflict started as a disagreement. A tension. Something uncomfortable. Nobody addressed it early and it became part of the culture.

The power imbalance started as a manager showing favouritism. Small things. Unchecked things. That over time became a toxic dynamic requiring an ultimatum.

Early intervention is not complicated. But it requires leaders who are willing to ask uncomfortable questions before they become unavoidable ones.

Start here. Ask your team regularly: is there anything we are not talking about that we should be?

At first people will not say much. That is normal. Trust takes time. But when your team sees that you can handle uncomfortable topics without reacting badly, they start to open up. Over time those conversations stop being a big deal. They become normal.

Culture is the early warning system

The most powerful tool a leader has is not a policy or a procedure. It is the culture they build every day.

When a leader consistently says, through words and actions, that is not how we do things around here, it becomes easier for everyone to call out behaviour that does not fit. It becomes expected that conflict gets dealt with, not worked around.

That phrase is simple. Direct. Non-personal. It calls out the behaviour without attacking the person. Used consistently, it shapes a team where conflict does not have the chance to embed itself for twenty years.

When you need more structure

Sometimes the question and the culture are not enough. When behaviour is not changing, use a framework. Two worth knowing:

SBI — Situation, Behaviour, Impact. A team member consistently misses deadlines and it is affecting the project. You say: last Thursday before the client presentation (situation), the report was submitted two hours after the agreed deadline without notice (behaviour), which meant the team had to rush the final review and we nearly missed the client deadline (impact). Factual. Focused. Hard to argue with.

DESC — Describe, Express, Specify, Consequences. Describe what happened. Express how it affected you or the team. Specify what needs to change. State the consequences if it does not. Gives the conversation structure and clarity without becoming an attack. Both models keep the conversation grounded in facts. They give both parties a framework to work within. And they create a clear record if things escalate further.

This is not about worst-case scenarios

Here is what I want the emerging leaders reading this to hear.

You do not need to be the most senior person in the room to make a difference. You do not need a title or a formal role. You just need to be willing to ask the question and create the space.

Yes, those conversations can feel risky. What if it goes badly? What if they react poorly? What if I make it worse?

Those are real fears. But they are not the only outcomes.

You might learn about a struggle someone has been carrying alone. You might be the start of a change someone has been waiting years for. You might build a relationship that changes the dynamic of the whole team. You might discover the conflict was never really about what it looked like on the surface.

Those are just as real as the worst-case scenarios. And in my experience, they happen more often.

The question for you

Is there something in your team right now that is not being talked about?

A tension everyone feels but nobody names. A dynamic that gets worked around instead of addressed. A conversation that keeps getting put off.

You do not need a regulation to tell you to act. You just need to be willing to go first.

Change does not happen by waiting for someone else. It happens when one person decides to go first.

That person can be you.

Drop a comment below. And if this series has been useful, share it with a leader in your network who needs to read it. Because the cost of waiting is always higher than the cost of the conversation.

LeadershipConflict ResolutionPsychological SafetyWorkplace CultureVictorian LawTeam CultureDifficult ConversationsHuman SkillsEmotional Intelligence

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