By Kristie Willis, Employment Solicitor, Palmers Solicitors
A recent report by the Institute of Public Policy Research (IPPR) has found that the “hidden cost” of employee sickness in the UK reached £103 billion in 2023.
This is an increase of £30 billion since 2018. Surprisingly, £25 billion of this increased cost is due to lower productivity from people working through sickness, with only £5 billion related to rising sick days.
The report has also found that workers in the UK “are among the least likely to take sick days, especially compared to other OECD and European countries.” Those lacking formal qualifications and those from ethnic minorities are particularly likely to work through poor health.
Analysing the figures
There are different types of workplace ill health which could factor into these figures, including:
- Those who are off on long-term sickness often as a result of long-term health problems and disabilities;
- Those that suffer from long term, dynamic health problems and disabilities who have intermittent flare ups and require days off in relation to these, but are otherwise able to work;
- Those suffering from short term illnesses who require short term absence.
The report recognises that working while sick does not always carry a cost to productivity. In some cases, it can have a therapeutic effect, but it depends on the illness and the employee in question.
However, the above data also shows that a lot of the productivity loss is actually from people not taking time off sick but continuing to work – at least part of which relates to those with long term health conditions.
The report notes that: “Twenty-six million people have long-term conditions in the UK. The number of working-age adults living with one or multiple health conditions is set to rise rapidly over the next decade.”
It is therefore important that employers are aware of their obligations in respect of long-term health conditions and disabilities, including the duty to make reasonable adjustments and avoid discrimination.
Setting a precedent
Employers should tackle the issue of employees working when they are not fit to do so by encouraging senior members of staff to set examples on when they are fit to work and when they are not.
If employees are at work when they are unwell, not only could any microbial illness spread through the workplace, but it may also take longer for the employee to recover, which could then affect the employee’s productivity over a longer period of time.
Employers should use return-to-work meetings and ongoing one-to-ones to ascertain the workplace dynamic in relation to sickness absence and seek to avoid a position where employees feel that they must attend work even when sick, whether this is due to workload, perceived negative views on sickness or financial reasons.
In addition, it can help if employers can be flexible.
For example, allow employees to work from home rather than being required to attend the office if they feel they cannot manage the commute.
That said, there is a fine line between whether any employee should be working if they are feeling under the weather, or whether they should be off sick.
Employers will need to consider this on a case-by-case basis, particularly if the employee has a disability or long-term condition.
Proposed solutions
The solution to these issues proposed by the IPPR is based on the Government and businesses working together to improve the health of employees, which will, in turn, benefit businesses and the economy.
The report continued: “IPPR is proposing a bold pro-business health plan which reimagines the role of business in health – clamping down on businesses that harm health and scaling up businesses that create good health – to deliver a healthy future of work for all. The think tank argues this would help the new government achieve health, prosperity and economic growth.
“The plan includes:
- Incentives: A new tax incentive for companies that commit to significant improvements in the health of their workforce, including the security, flexibility and pay of their staff, focused on SMEs.
- Regulation: A new ‘do no harm’ duty for employers, regulating them on health outcomes, not just safety inputs.
- Investment: New compulsory reporting on worker health – modelled on climate emissions reporting – to help private investors differentiate between health-orientated and health-harming businesses”.
In respect of incentives, it is proposing that those who meet certain standards relating not only to policies and procedures but also in respect of outcomes, including regarding the level of employee satisfaction for example, will have access to a temporary reduction in employer National Insurance Contributions (NICs) for a period of five years (provided a yearly certification is met).
Improving workplace environments
The report points to the fact that there are currently high levels of employment but that the quality of the employment appears to have deteriorated.
For example, in 2023, there were over 1 million people on zero hours contracts as opposed to 190,000 in 2011. The current Government has pledged to ban exploitative zero hours contracts so it is likely this will happen in some format, although the final proposals as to how this will work in practice are not clear currently.
To enable a continuous improvement incentive, it is proposed that where sufficient changes continue to be made, employers could become re-eligible for any incentive.
These proposed changes could be part of the measures considered by the Government to support employees and improve the health of employees overall.
At present, it appears that the number of people living with long-term health conditions is likely to increase and as such, it will likely be a combination of Government-led initiatives and employer led initiatives that provide the best outcomes in terms of productivity for both employees and employers.
The government is already proposing substantial employment law changes so it remains to be seen whether any of these proposals will be actioned.
Please contact our Employment Law team today to discuss workplace wellbeing initiatives for your business.