Mental health is defined as “a state of wellbeing in which the individual realizes his or her own potential…” (Organization World Health, 2020), whereas poor mental health is when wellbeing is undermined. Poor mental health affects 20% of working adults annually, with up to 50% experiencing a mental health-related issue in their lifetime (Vigo et al., 2016), and is associated with serious consequences including diminished productivity, and increased absenteeism and presenteeism (Bubonya et al., 2017).

Although research has largely examined organizations and their leaders as potential sources of employee well(ill)being (Inceoglu et al., 2018), employee mental health incidents are not always a result of workplace experiences and leaders are in a unique position to intervene. This is because of leaders’ proximity to employees, control over organisational resources and administrative tasks, and their capacity to offer support (Montano et al., 2017). By integrating leadership and clinical psychology literatures, we examine how leaders respond to mental health incidents and thus shape the progression of the incidents over time while identifying boundary conditions. Consequently, we contribute a subordinate-centric perspective that explores the reciprocal nature of employee wellbeing and leadership (Follmer & Jones, 2018) that extends wellbeing beyond hedonic definitions to include mental health (Inceoglu et al., 2018).

An abductive approach to analysing semi-structured interviews (N = 62) with leaders yielded four interconnected themes and our conceptual model (Table 1, Figure 1). The presenting employee mental health incident tended to be indicated by behavioural symptoms such as absenteeism or decreased performance, which leaders attributed mostly to exogenous (e.g., work-family conflict) rather than endogenous (e.g., medical condition) sources. Leader intervention strategies highlighted the importance of noticing the problem and early intervention. Social support, planned absence, and work simplification were the most common interventions. Some interventions reversed the employee’s downward spiral and produced positive outcomes. Others, particularly if delayed, resulted in further deterioration and often voluntary turnover. Leaders and coworkers also experienced more stress when interventions were delayed. Organizational factors shaped leaders’ propensity to act and the way they responded. Factors that emerged as facilitators include demonstrated behavioural integrity and policies that support mental health such as in-depth mental health training. Results suggest that employee outcomes may improve via interventions such as mental health awareness training, early intervention and a broad repertoire of interventions; and organizational policies that create favourable conditions for intervention.