Staff absence a concern for both unions and employers

In January 2005, the UK's Trades Union Congress published a report examining staff absence due to ill-health, claiming that much of this is due to rising workplace stress. The report comes at a time of growing employer concern at the extent and cost of sick leave, with some employers introducing new policies designed to provide incentives for attendance and make 'absenteeism' more difficult.

In January 2005, the Trades Union Congress (TUC) published a report, entitled Sicknote Britain?, against the backdrop of increasing controversy over staff absence in the UK (UK0404103F). The Confederation of British Industry (CBI) has stated that employers are concerned at the cost of sick leave and worried that much of it is not genuine. The issue has also become important in the public sector due to government efforts to improve efficiency and to tackle the relatively high levels of absence in the civil service. As employers are increasingly pursuing a range of 'carrot and stick' policies to tackle staff absence, the TUC argues that they should prioritise measure to reduce stress and improve work-life balance.

The TUC report

The TUC report, based on secondary data analysis and surveys commissioned by the TUC, states that British workers do not take a lot of sick leave by international standards, and that employers recognise that most sickness absence is genuine. It finds the average figure for short-term sickness absence to be 4.9 days per year for employees in the public sector, compared with 5.5 for private sector workers with similar jobs. It acknowledges that overall absence in the public sector is higher than in the private sector, but explains this by higher levels of stress inflating long-term sickness leave. The report also strongly criticises claims that incapacity benefit figures are inflated by fraudulent applications (UK0501106F). The TUC concludes that if employers want to reduce the costs of staff sickness, they should pay closer attention to flexible working, improving work-life balance, and reducing long hours to tackle the problem of stress.

The report also suggests that 'presenteeism' is a bigger problem than absence. According to a poll commissioned by the TUC, three-quarters of workers admitted to having struggled to work when too ill to do so. TUC general secretary Brendan Barber said: 'Sicknote Britain is an urban myth ... When employers complain of sicknote Britain, they are attacking some of Europe’s most loyal employees.' He added that: 'We work the longest hours, and have the fewest public holidays.' Workers in England, Scotland and Wales have eight public holidays per year, compared with 10 in Northern Ireland and an average of 11 in Europe. The unions have pressed the government to extend holiday rights, including providing that bank holidays no longer count as part of the statutory 20 days’ leave entitlement under the Working Time Regulations (UK0209102N).

Employer absence surveys

Managing attendance has become an increasing concern of employers. A 2004 report based on 896 manufacturing workplaces by IRS and the Engineering Employers’ Federation (Employment Review 794, February 2004) found that long-term absence had moved up the management agenda in almost half of companies surveyed. The major reasons were concern about costs (reported by 39.1% of employers), a rising trend of long-term absence (22.1%), concern for employee wellbeing (21.4%) and worries about potential claims for employer liability (17.4%). Hardly any respondents (0.7%) mentioned trade union pressure, despite the fact that stress (mentioned by 40.1%) and back problems (33.8%) were seen as bigger causes than non-work-related accidents and injuries (21.1%).

The TUC report came as the CBI claimed that 'dubious sickness' amounted to 25 million working days a year. A spokesperson pointed to the CBI’s own annual absence survey and said: 'Our survey shows that the public sector has a worse record of absence for both long-term and short-term sickness ... We also wouldn’t accept that there is any link between stress and absence, something the unions try to trumpet every time they talk on the issue.' The 2003 survey, based on replies from 550 employers with nearly 1.5 million employees, found that employers feared up to 15% of absence was not genuine. They estimated the cost of this at GBP 1.75 billion a year in terms of salaries for absent employees and the costs of overtime and replacement labour. John Cridland, the CBI deputy director-general, said: 'Though employers believe most absence is caused by genuine minor sickness, there are serious concerns about the number of staff 'throwing sickies'. There are too many people who will happily spend the day off work at the expense of their employers and their hard working colleagues.' However the survey also reported that the number of working days lost fell by 5.7% from 176 million in 2001 to 166 million in 2002. At 6.8 days per employee, or 2.9% of total working time, this was the lowest figure recorded since the survey began in 1987.

In contrast, the CBI’s 2004 survey reported a 6% rise in the number of working days lost, which rose in 2003 to 176 million, though this could also reflect an unscientific sampling approach. The 2004 survey reported an average of 8.9 days per employee lost due to sickness in the public sector, compared with 6.9 in the private sector. There was also a major difference by company size, with firms employing over 5,000 workers having an average of 10.2 days lost per employee, compared with just 4.2 in firms with fewer than 50 employees. The CBI explains this by greater management proximity and peer pressure on attendance in smaller workplaces. Mr Cridland commented that the cost of workplace absence was 'worryingly high', and that 'absence is a serious and expensive concern that is on the increase ... Unwarranted long weekends and staff 'pulling sickies' are taking their toll on the UK’s ability to absorb the enormous cost of absence.' However, he also accepted that tough trading conditions during 2003 had forced many firms, particularly those in the service sector, to shed staff. 'This would have increased pressure on employees and possibly affected morale, leading to an increase in absence', he said.

The TUC went further in blaming employers for much of the problem. Mr Barber said that over three-quarters of sickness absence is made up of people on long-term sick leave, and criticised employers for failing to prevent and deal with serious illnesses such as stress, back pain and occupational asthma. 'The increase in sickness absence reported in the CBI’s survey shows that employers, particularly in the service sector, continue to make workers ill through overwork, bad management and outdated work methods', Mr Barber said, adding: 'The TUC and the CBI need to work together to get employers to concentrate on keeping staff healthy and in work, which should be even more important in a struggling sector. And when people are made ill, they should concentrate on getting workers healthy and back to work.'

The Chartered Institute of Personnel and Development (CIPD), which also conducts an annual survey of employers’ policy and practice concerning sickness absence, estimates the annual cost of staff absence at GBP 706 per employee in the public sector, GBP 575 for manufacturing and production, and GBP 535 for private services. The CIPD’s latest survey, which covered 1,110 organisations employing 2.9 million staff, also found that less than half of all employers (46%) actually monitor the cost of sickness absence. Four in five do collect information on the causes. Most absence was accounted for by minor illnesses such as colds and headaches, followed by back pain for manual workers and stress for non-manual employees. The latter two factors were reported as particularly significant in explaining long-term absence.

Best practice advice

There is no shortage of policy and practical advice for employers concerning absence management. In part, this reflects the potential for legal claims such as unfair dismissal where an employee’s contract of employment is terminated due to long-term or persistent intermittent absence. Employment lawyers and personnel professionals emphasise the need for good record-keeping, management training and responsibility, regular contact with absent employees, fair notification and caution procedures, and systematic return to work interviews. The Disability Discrimination Act 1995 has also raised the profile of capability assessments and reasonable work adjustments, which could extend to regular risk assessments including for matters such as stress.

The Advisory, Conciliation and Arbitration Service (Acas) states in an advisory booklet that: 'High labour turnover and absence, like lateness, may be due to a particular cause but they can also be an indication of more fundamental organisational problems ... Although some absence is outside management’s control, levels of absence can be reduced when positive policies are introduced to improve working conditions and increase workers’ motivation to attend work.' Acas recommends that: managers, 'in consultation with workers and their representatives', should pay close attention to ensuring good physical working conditions, ergonomics and health and safety standards; employees and supervisors are well-trained; there is clear communication between management and staff; and jobs are designed so that they give motivation and provide job satisfaction, with 'variety, discretion, responsibility, contact with other people, feedback, some challenge and clear goals'. Managers should also be sympathetic to authorising occasional notified absence for personal reasons, and pay attention to flexible working to encourage good work-life balance.

The CIPD agrees with this approach and says that: 'A large part of managing absence is about ensuring staff can raise issues that may be troubling them at an early stage with their managers so that they can be addressed before they escalate. Effective absence management is about creating work environments where employees are less likely to wake up and think 'I don't feel like going in to work today'.' However a CIPD survey of 1,000 employees reported in October 2004 that 21% found their jobs very stressful and 26% said they received little or no support from their supervisor.

Internationally, the Federation of European Employers has developed a model company wellness policy. Companies are advised to: reward employees with longer paid holidays if they do not take short periods of absence during the year; take a 'proactive' approach to wellness in order to reduce the incidence of absence; permit discretionary absence 'where humane and justified'; not be 'over-punitive' in the handling of legitimate absence and expecting those with serious contagious conditions to turn up for work; and place the financial burden for absence on individual departmental managers.

Employer initiatives

A number of well-publicised company-level initiatives, introduced with or without trade union support, have raised the profile of absence management in recent months.

• Tesco, the UK’s leading supermarket chain, is piloting a number of schemes, which include suspending sick pay for the first three days of absence (though this is restored if the absence is for longer than three days), and offering more holiday entitlement subject to attendance. The company said: 'Our people tell us that unplanned absence is a real issue. It impacts on our business as well as creating more work for people in store. These trials are about encouraging people to use planned absence [instead] whenever they can ... Our intention is not to penalise people who are genuinely ill. It is to discourage people from taking those odd days'. The Union of Shop, Distributive and Allied Workers (Usdaw), which represents about half of Tesco’s 220,000 workers, said it supports the trial because 'we want to have an input and share the learnings, and have a say in shaping and influencing the outcomes'. The trial is being run on a voluntary basis in about 20 stores.

• The Royal Mail, which reports that as many as 10,000 staff (6.5% of the operational workforce) are off work at any one time, recently introduced an attendance bonus scheme based on prize draws for a range of goods from weekend breaks to a car. However, Communication Workers’ Union deputy general secretary Dave Ward said: 'Gimmicks won’t offer a solution to low morale and stress levels resulting from the physical demands of the job and regimented management styles.' He also said the company was implementing a policy of coercion as well as inducements: 'We have seen plans they have to bully and harass our people back to work even when they are genuinely sick: calling the office before duties begin - sometimes at five in the morning; long term sick people being forced into interviews; pressurising people when that is the last thing they need ... People can’t be bullied into being well.'

• As part of a settlement to a pay dispute in August 2004, British Airways introduced a bonus scheme linked to attendance. It provides: GBP 200 for staff with no more than four days' absence between 1 October 2004 and 31 March 2005; GBP 400 for staff with no more than six days' absence between 1 April 2005 and 31 December 2005 (and 1 January 2006-30 September 2006); and GBP 1,000 for staff with no more than 16 days' absence between October 2004 and September 2006. Individual managers will also be granted greater powers to monitor employees. The company hopes to reduce the average annual sick days taken by employees from 17 to 10, saving around GBP 30 million per year.

• Sickness absence in the Department for Work and Pensions (DWP) averaged 12.6 days in 2003-4. Figures published by the Cabinet Office showed that civil servants on average took 10 sick days a year in 2003, up from 9.8 in 2002. The government had set a target in 1998 of cutting sickness absence to 7.2 days by 2003. In a spending review in July 2004 (UK0407105F), Chancellor Gordon Brown announced a review of short- and long-term sickness in the civil service, and pointed to the high level of self-certification that he said was 'open to abuse'. Employees are generally required to seek a doctor’s note only if they are off work for more than a week, and 82% of sick leave is taken without a medical note. However the British Medical Association is already unhappy with the amount of doctors’ time spent writing sick notes. Ministers are therefore looking to tackle the problem through better staff management and workplace monitoring. The DWP has responded with a number of measures including: setting a trigger point - eight days of absence - at which management action should be considered; stopping pay on the fifth day of absence if the employee fails to produce a medical note; introducing return-to-work interviews; setting up a special taskforce to deal with cases of long-term absence; and providing better access to occupational health. However, a report by the National Audit Office (NAO) blamed DWP absence figures in part on workforce demographics and increased employment in call centres. Mark Serwotka, general secretary of the Public and Commercial Services Union, the DWP’s biggest union, said: 'The NAO report is right to set the sick absence figures in the context of an organisation facing huge change, not least in the axeing of 30,000 staff ... Far from being work-shy, staff in the department face increasingly stressful conditions such as IT failures and job insecurity. Matters are hardly helped by the bullying, hardline approach of senior managers in departments such as the DWP and increasing workloads and job insecurity within the civil service'.

Commentary

Statistics show that employee sickness absence is fairly low in the UK, though there has been a rise in self-reported work-related illness such as stress, which has prompted increased employer attention to absence management. Various policies have been introduced to reduce the incidence of short-term absence, which can be particularly disruptive. Most of these have been based on a mixture of coercion and reward for attendance. However, best practice advice suggests that employers should look to more fundamental features of the employment relationship if they want to reduce staff sickness absence. Cutting the levels and costs of absence requires attention to the root causes, which include stress due to long hours, high workloads, job insecurity and abrasive management styles. It also requires attention to occupational safety and health, including workplace ergonomics and training, and providing for employee support as well as discipline. All of this requires significant investment of resources, which employers may be unwilling or unable to pay.

Within the UK public sector, cost-cutting 'efficiency drives' may be part of the problem: 67% of staff in the Department of Health took no time off sick in 2002, compared with only 28% in the Inland Revenue and 30% in the DWP. From this perspective, the issue may not be so much about employee malingering but the physical and mental price paid by many workers to keep their jobs. According to a 10-year study of 10,000 civil service workers, staff who struggle into work when ill could be seriously putting their health at risk. Professor Sir Michael Marmot, who headed the study, said: 'Among 30 to 40% of the population, we have found that those who were unwell but took no absence at all from work had double the incidence of coronary heart disease over the following years.' Policies such as docking pay for sickness absence are therefore likely to be damaging to health as well as income, particularly for lower paid workers who would be more inclined to struggle into work. Unfortunately this is an increasingly attractive proposition for employers, especially since there is no law entitling workers to sick pay in the UK. Statutory sick pay is paid only after the first three days, with companies claiming about 80% back from the state. (J Arrowsmith, IRRU)