Improving Wellbeing to Reduce Absenteeism

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The role of health cash plans in looking after employees

The UK has one of the highest absenteeism rates in Europe and it is a growing problem. Jonathan Burton, Chief Executive for Health Shield, explains how health cash plans can help to reverse the trend.

We may live in a high tech world, but people are the heartbeat of any organisation. The energy, ideas and enthusiasm of employees drives the success of businesses of all shapes and sizes. So, it’s no wonder that employee wellbeing and reducing absenteeism are hot topics that are high on the agenda of big corporates and SMEs alike.

Sickness absence in the UK

If we look at the bigger picture and the financial impact on UK businesses, a recent Government report states that sickness absence costs the UK economy a staggering £100 billion per year.

According to the Office for National Statistics, 131 million days were lost due to sickness absences in 2013. That’s the equivalent of 4.4 days per worker per year. What’s even more concerning is that UK employees take up to four times as many sick days as workers in other countries.

The bottom line is that in 2014 sickness absence cost UK organisations an average of £609 per employee per year. Whatever the size of your organisation, looking after your people and improving their wellbeing is not only the right thing to do – it’s a sound investment in the future.

Improving employee wellbeing

While some employers may argue that sickness is something that’s out of their control, others are taking a more proactive approach to looking after their employees. Employers have a duty of care to their employees, which means that they should take all steps which are reasonably possible to ensure their health, safety and wellbeing. In addition to their legal obligations, an increasing number of employers have come to appreciate that a healthy workforce is a happy workforce and are introducing a variety of new initiatives that range from Zumba classes and bowls of fresh fruit to stress counselling and health cash plans.

Health cash plans

At Health Shield, we know a lot about employee wellbeing. We’re one of the leading health cash plan providers in the UK and, as such, we see first-hand the positive difference such products can make. For example, one of our customers saw their sickness rates reduce from 4.5% to just 0.5%. However, there remains a low awareness of health cash plans amongst employers.

Put simply, health cash plans enable employees to claim cashback up to annual limits for everyday health treatments such as dental, optical and physiotherapy. Employers can pay to provide cover up to set amounts or choose to introduce a voluntary scheme where employees pay for their own cover. Unlike many medical insurance schemes that cover more serious illnesses, health cash plans are usually open to everyone at every level.

There are many different health cash plans available but they are all designed to help employees look after their health. For example, regular eye tests and dental check-ups can help prevent diseases or spot the early signs of more serious conditions. These may seem like small things, but they can make a big impact on reducing absenteeism. After all, minor illnesses are the most common reason for sickness absence while two thirds of working time lost due to absence is accounted for by short-term absences (up to 7 days).

Health cash plans can also offer many preventative services that can help employees to keep fit and healthy in the long term. These can range from physiotherapy and discounted gym membership to 24/7 counselling and GP helplines. Such benefits can help with some of the most common causes of long-term absence such as back pain, musculoskeletal injuries, mental ill health and stress.

Stress in the workplace

Stress in particular is a growing problem for employers with two-fifths of organisations reporting an increase in stress-related absence from 2013-2014. Over 33% of organisations stated that non-work factors were a major cause of stress at work. While a third of organisations identified stress as a top cause of short-term absence, few were taking any steps to address it – this despite the fact that nearly 45% of employees say they know a colleague who has given up work due to stress.

Stress is a condition that can often be overlooked by employers, colleagues and managers. However, in addition to counselling services and helplines to support employees, employers can now take advantage of the growing number of occupational health services. Occupational health professionals can provide expert support to both employees and HR teams from day one of absence and help employees return to work much earlier than they would have done without the support.

Looking after employees

The good news is that many employers are now taking a proactive approach to looking after the wellbeing of their employees, which is leading to a gradual overall reduction in sickness absence in the UK. Nearly three quarters of organisations with 250 employees or more now monitor absence levels as part of their Key Performance Indicators and the vast majority of organisations that introduced or made changes to managing absence have reported a positive impact.

If you look after the wellbeing of your employees, they will be happier, more motivated and therefore more productive. In addition, your reputation as an employer of choice will grow, which will help you to attract and retain the best talent in the long term. You have to invest in your people to reduce absenteeism but we believe that improving the health of your employees will add measurable value to your organisation. It’s also the right thing to do.


CIPD Absence Management Survey Report 2014

Price Waterhouse Cooper

Department for Work and Pensions