The case for absence management can no longer be disputed. According to a recent survey by the Confederation of British Industry (CBI), absence from work cost the UK £11.6bn in 2003, with the average employee being absent for 7.2 days.
The causes of absence are many and varied, but they can be tackled. Any business that is serious about managing risks and cutting costs should be looking to implement absence management as a matter of urgency.
The argument for absence management has been given extra credence lately, thanks to the media spotlight placed on absence and its cost to British business. The press has focused on the number of fake sick days taken by employees in the UK, using statistics from the CBI's Room for Improvement - absence and labour turnover survey 2004. The survey shows that UK employers believe 15% of sickness absence to be non-genuine, suggesting that over 25m days are lost each year to 'skiving'. Already, Tesco has made headlines by proclaiming that staff in new stores will be contracted to go unpaid for the first three days of sick leave, and other businesses will surely follow suit.
The average direct cost of absence is £475 per employee. Indirect costs, such as overtime, casual labour, or loss of production, can double this original amount. When this is considered, it is no wonder that businesses like Tesco are resorting to extreme measures to bring things under control - though the effects these measures may have upon employee morale could be detrimental. The absence problem, however, is not simply caused by non-genuine sick days, there are other factors to consider and address.
Long-term absence places a far greater financial burden upon British business than the occasional sick day. The CBI estimates that, although long-term absence accounts for just 5% of all absence cases, it is responsible for a third of the total time lost through absence. It is clear then, that by tackling long-term absence businesses can drastically cut their absence costs.
The major causes of long-term absence are musculo-skeletal injury and stress. The Department for Work and Pensions (Developing a Framework for Vocational Rehabilitation) states that:
- musculo-skeletal conditions caused 12.3m lost working days in 2003
- mental ill health caused 13.5m lost working days.
These conditions can be treated by rehabilitation and counselling respectively.
Rehabilitation
The CBI itself states that 'Employers have perhaps done less than they might have done to capitalise on the benefits of adopting a rehabilitation policy.' At various points, their report points to rehabilitation as a highly effective means of reducing long-term absence, stating that: 'those companies that provided access to medical care or treatment, while relatively small in number (35%), had the lowest levels of absence.'
The CBI is only one of a number of official bodies that are seeking to promote rehabilitation as a means of tackling rising levels of absence.
Already the Department of Work and Pensions has announced its plans to develop a 'framework for vocational rehabilitation' and now the Health & Safety Council (HSC) has produced its Strategy for Workplace Health and Safety in Great Britain to 2010 and beyond.
In this document the HSC states that it will 'strengthen the role of health and safety in getting people back to work through a much greater emphasis on rehabilitation, as a contribution to the wider government employment agenda.'
Industry and governmental forces are thus bidding to push rehabilitation up the agenda. The drive will gain even greater urgency in November, when new legislation will enable the NHS to recover its costs for treating personal injury claimants, where an employer is found to be liable. By having in place the proper absence management procedures, businesses can also reduce their liability claims costs. If the time that it takes to get an injured employee back to full fitness is reduced, potential claims costs are also reduced. In fact, rehabilitation treatments have the potential to cut employer's liability claims costs by up to 50%.
Rehabilitation providers can reap major rewards for employers by repairing musculo-skeletal damage and getting staff back to work as quickly as possible.
The most effective rehabilitation will target long-term sickness, examine the working environment as well as the workers themselves, and provide pre-employment screening to check an applicant's physical suitability for a job.
Whereas it can take six weeks in the NHS for a patient to go from GP to consultant to physiotherapist, private rehabilitation providers can attend to an injured party the day after an accident- assessing and treating an injury in a fraction of the time. Faced with six weeks without an employee who costs £300 a week, many businesses would opt to spend £200 in getting them back to work through rehabilitation. When rehabilitation is implemented quickly it can reduce return to work time by as much as 70%.
The reporting processes adopted by rehabilitation providers also enable businesses to monitor the costs of absence management programmes. Employers will be told exactly what level of treatment is required and how much it is going to cost. Rehabilitation providers will also report to the employer at various stages throughout the treatment process, giving an accurate prediction of how long it will take for the injured party to be fully fit.
There are obvious benefits for the injured employee also. After assessing an injury, clinicians will provide the most appropriate treatment. The intention is to provide the highest level of pain relief and get the injured party back to full fitness, in the most cost effective manner and as soon as possible. If rehabilitation is complemented by injury prevention advice, the risk of injury re-occurrence is greatly reduced. It is estimated that 27,000 people leave work every year because they are classed as being unfit - this figure can only be tackled if UK employers nurture healthy workforces.
The use of rehabilitation techniques can go a long way to managing and reducing long-term absence, but another route must be taken to manage the issue of stress.
Dealing with stress
The CBI survey found that stress was ranked as the second most important cause of illness among non-manual workers. And it is not only the private sector that is affected by this type of absence. A recent survey on public sector absence by the Chartered Institute of Personnel and Development found that more than half the respondents believed stress-related absence had increased during the past year.
Absence due to stress has become more prevalent in recent years, and this trend looks set to continue, as people struggle to find a balance between work and home. Stress has not only led to a rise in workplace absence, it has also led to a plethora of claims against employers. Claims for stress or psychological conditions are now commonplace and can result in substantial payouts.
In response to this, some rehabilitation providers are offering evaluation and treatment services for work-related stress. Treatment often comes in the form of telephone, on-line or face-to-face counselling. This can be combined with physical rehabilitation, as stress often goes hand-in-hand with physical damage.
Risk manager's role
There are many absence management solutions available to businesses seeking to address the problem. However, their effectiveness can be negated if management does not get involved. Risk managers in particular can play an important role. The CBI survey found that 'where risk managers were involved in absence management, absence fell to 6.6 % per employee, suggesting their involvement could be an effective means of reducing absenteeism.' In spite of this, only 4% of survey respondents gave risk managers a role in absence management. Risk managers must be given more responsibility in order to reduce absence to the optimum level.
Equally, absence management results can be improved when unions are involved in the process. Unions may be suspicious of absence management - seeing it as a means of cracking down on employees. Good rehabilitation providers can remove this suspicion by talking to union leaders and explaining the ways in which absence management techniques benefit employees.
Absence is an issue that affects all UK businesses, from major corporations to SMEs. Ninety per cent of businesses say that absence is a significant cost, but many admit they cannot quantify that cost. It is obvious that something should be done.
Absence management benefits both employer and employee but is fundamentally an exercise in risk control and cost reduction. By implementing rehabilitation programmes, businesses in the UK could save themselves millions. A healthy workforce equals a healthy business, after all.
David Bingham is managing director, IPRS (Injury Prevention and Rehabilitation Services), www.iprs.ukcom TUC STRESS REPORT
Stress is the UK's number one workplace hazard, according to a report published in the Trades Union Congress' Hazards magazine last year. This claimed that employees who are exposed to stress for over half their working lives are 25% more likely to die from a resultant heart attack and 50% more likely to have a fatal stroke.
The study also found that blue collar workers are more likely to suffer from the consequences of stress than executives. Long-term stress is more likely to occur on the shop floor, due to excessive overtime, night shifts and work with high psychological pressure and low rewards.
Other findings in the report include evidence showing that a worker's mental health deteriorates when a change in workload results in higher demands, less control and reduced support. Working for a boss who is considered to be unreasonable or unfair can also lead to high blood pressure, while poor management planning and organisation can lead to heart disease. The researchers also found that to deal with stress, workers will often smoke and drink - behaviour that can further damage health.
