20/05/2002

Sickness absence costs companies over £280m

New research suggests that medium-sized businesses in the construction sector could be losing £280 million a year due to sickness absence – equivalent to over 7% of their annual salary bill.

The figures, from income protection provider, UnumProvident, show that employers have become more concerned about employee sickness due in part to new legislation and guidelines holding employers more accountable for the welfare of their staff. However, there is growing evidence that in some instances the problem is increasing. Between 1975 and 1995, the proportion of 16-44 year olds with a longstanding illness rose from 16% to 23% - and from 34% to 41% among those aged 45-65, and there is no sign that the issue is abating.

Joanne Hindle, Corporate Services Director, UnumProvident, explained: "Sickness absence is a big problem for all employers, not just the big companies. Unfortunately, many employers underestimate its true cost. Indeed up to 18% do not include occupational sick pay when calculating the cost of sickness absence and 39% ignore additional overtime expenses.

"It is often said that staff is the most important asset employers have. Sadly this is not reflected in their sickness absence programmes. Employers, insurers and other interested partiers must work more closely to address this problem."

(CL)


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