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Sickness Absence
October 2008
SICKNESS ABSENCE
HOW TO REDUCE ABSENCE LEVELS
Employees working for smaller companies are less likely to receive generous company sick pay than their counterparts in larger businesses. Does this have a direct effect on the level of sickness absence?
Sick note culture
According to a recent report by Dame Carol Black, the National Director for Health and Work, ill-health is now costing the UK over £100 billion a year. This figures includes the cost of benefits, health and expenditure and lost taxes as well as the more conventionally measured lost productivity. Yet, whilst most research has focused on the fact that public sector employees take more sick leave than their private sector counterparts, little work has been done on the impact that the size of the organisation has on absence figures. This has now changed, so what’s the latest news?
Link to generous sick leave
A study published in 2007 by the European Foundation for the Improvement of Living and Working Conditions entitled “Being on Sick Leave: Possible Explanations for Differences of Sick-Leave Days Across Countries”, examined the reasons behind the differing rates of sickness absence per person in 20 countries. It carried out face to face interviews with 30,000 workers in the USA and Europe between 1996 and 2002 and found that the main factors in determining the amount of sick leave taken included the amount of sick pay and the strictness of employment protection.
Size matters
As the amount of sick pay was found to influence the sickness absence levels, researchers took this one stage further and looked at the impact that business size had on average sickness absence levels. It found the following (1) 2.5 days for a one person enterprise/ / (2) 2.8 days for a self employed individual/ / (3) 3.2 days for a micro enterprise/ / (4) 4.6 days for a small enterprise/ / (5) 5.6 days for a medium enterprise/ / and (6) 7.4 days for a large enterprise.
Small is better
The link between the size of firm and the amount of sickness absence was confirmed in a report by the Health & Safety Executive in 2006. It found that whilst the average taken in large organisations, with over 250 staff was eight days in the public sector and 6.9 in the private, it was only 3.9 days for businesses with less than 25 employees. One key factor is that an employee in a small firm knows that their absence will be more keenly felt.
Tip. Take a look at your sickness absence figures to see how they compare with these findings.
Combating the problem
If you don’t just want to assume that your size alone will limit your exposure to high levels of sickness absence, there are other measures that you can introduce so as to ensure that only those who are genuinely sick take time off.
Tip. If you currently pay company sick pay, consider retaining the contractual right to withhold it in certain circumstances, such as where a GP’s note is not produced when requested, or if you have good grounds to believe that the reason for the absence is not genuine. Also, look at offering company sick pay at a reduced rate from day one, e.g. at 70% of salary.
Average sick leave per employee in a company with less than ten employees was 3.2 days as opposed to 7.4 days in a larger company. But don’t rely on your size alone/ / consider withholding sick pay in certain circumstances.
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