How much does sick leave cost?

An estimated 6.6 million working days were lost due to work related musculoskeletal disorders (MSD’s), an average of 14 days lost for each case. MSD’s represent 24% of all days lost due to work-related ill health in Great Britain in 2017/18. Within the total number of 6.6 million days lost due to MSDs, upper limb disorders account for around 2.6 million of days lost, with back disorders around 2.2 million of days lost and lower limb disorders (LLDs) 1.7 million days lost.
Source: HSE report

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Sick leave costs British companies and government agencies billions of pounds in decreased efficiency and increased operational costs!

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How can you calculate the cost of sick leave?

Calculating the cost of sick leave will vary from company to company and from employee to employee. CEO Today Magazine cites an example for the UK based on an average wage of £27, 600.

‘In 2016, the sickness absence rate for companies with 25-49 employees was 2.2%. This means that 2.2% of all working hours are lost per year. Excluding holidays, there are 1,740 working hours in the standard year, of which 38.28 are lost per employee based on this 2.2% rate. For a company with 49 employees, these sick days would cost a total of £26,972 based on the average hourly rate of £14.38 – almost the entirety of the average UK employee’s salary.’

This is useful information, but it must be remembered that this only reflects an average and doesn’t take into account variations in seniority, industry or region.

Also read: Sick leave: Everything from prevention to pay and rights

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Is the average sick leave rate the same across all industries?

Absence rates differ significantly across the state sector, municipalities/regions and companies/organisations, and the rate is markedly greater in the public sector than in the business community. In 2016 the Office of National Statistics highlighted that UK public sector works were more likely to suffer from ill health than private sector workers (2.9/1.7% respectively), and in addition that women were more likely to suffer than men (2.5%/1.6%). Across the UK as a whole, 25% of total workplace absenteeism was as a result of work-related musculoskeletal disorders, over half a million cases! (HSE 2017)
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The hidden costs of sick leave

A total of £9.7bn was spent on new cases of work-related ill health in 2016/17 according to UK HSE statistics. Around a quarter of this expenditure relates directly to work related musculoskeletal disorders. From a business perspective this is an enormous cost in itself, but it is easy to overlook additional hidden costs. Decreased productivity leading up to sick leave is often immeasurable as worker morale falls due to ongoing discomfort. Lost revenue during absence of an important employee is another consideration, plus the costs of their temporary replacement, in addition to the cost of rehabilitation once the employee returns to work. We haven’t even considered the knock-on effect to UK GDP and tax revenues.

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How can the cost of sick leave be reduced?

35% of UK businesses have no strategy to improve employee wellbeing, but there are various things that can be done to reduce sick leave in your company. A planned health & wellbeing policy is a good place to start. Many businesses now offer flexible working hours, the ability to vary physical working environments, offer microbreaks and regular informal talking meetings, all good for morale. For office workers, a Display Screen Equipment assessment can also identify common physical risks in their work. In cases where sick leave occurs in connection with mouse arm conditions, ergonomic products such as computer mice and keyboards can be a big help. A positive and pro-active approach is key.

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