Assistant Solicitor Curtis Law LLP
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Legal Insight: Health matters part 1 - Managing sickness absence

19th Apr 2012
Assistant Solicitor Curtis Law LLP
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Doom-and-gloom tales about the state of the ailing economy are prevalent at the moment and companies large and small are reportedly taking drastic steps to save money. 

But if panic has not yet set into your organisation and there are no full-scale redundancy programmes in the offing, consider taking alternative action by reducing costs from the inside, holding on to the staff that you have and using the time to get your house in order.    There may be some initial outlay to adopting this approach, but you could also find that the benefits are significant.   One way of doing it is to look at the issue of sickness absence within your organisation. Sickness absence is expensive, but implementing well-drafted policies and procedures effectively could help to save you money.    Better management of the problem can likewise reduce it greatly. Some years ago, a big brand car manufacturer decided to develop full sickness absence policies in order to try and reduce its sickness absence rates.    Although the initial outlay in time and expense terms was around £200,000, the resultant 15% cut in sickness absence levels saw the company save about £11 million.     The relative figures in your organisation may be significantly lower than these, but the message is still the same: make an initial modest investment now and see huge benefits in the near future.   Drafting sickness absence policies   Policy development is something that you may have been avoiding for years and I can almost hear readers’ brains going into shutdown with the sheer dreariness of my next sentence.    A good, well-drafted policy is vital. Sorry. But it is important to set out the attendance standards that you expect of employees and to provide clear and systematic procedures for dealing with absence.    It may be dull, but once it is written and implemented, you should start to see changes in attitudes towards absence.    As a basic guide, a good policy should set out the following information:  

  • The standards expected of staff in regard to attendance
  • When and how to report sickness and to whom
  • When certification may be required and in what format
  • What happens in cases of unauthorised absence
  • The company policy on sick pay.

  It should also be made clear that following company sickness absence procedures such as reporting to managers appropriately is the responsibility of each employee and failure to do so could result in disciplinary action.   Implementing sickness absence policies   Policies should always be communicated to staff clearly and managers must be trained in how to apply them equally to everyone. Policies should also be provided to all new joiners and made accessible elsewhere, perhaps on the company intranet.   But despite this, motivating managers to deal with sickness absence effectively can be tricky, especially where they have little understanding of the true cost of sick leave.   Therefore, as part of their training, it is useful to show them of what such costs consist and to suggest ideas for what the money might have been spent on if it hadn’t been wasted on persistent absences.    But also remember that costs are not just generated by having to pay someone who is not there. Other additional direct costs often include paying for short-term replacements (usually at a higher rate) or paying higher overtime rates to other staff members.   Indirect costs, on the other hand, frequently include things like the impact of reduced customer service.   Once managers’ initial training period is over, however, emphasis should be put on ensuring that they implement policies consistently. Either HR or relevant line managers should also be responsible for keeping full and accurate absence records, which include the duration of any absence and the reason for it.   Enforcing sickness absence policies   A good policy is great but useless if not implemented consistently and fairly. Sporadic enforcement can lead to even more problems if employees feel that they have been treated less favourably than others – in this instance, you could end up with discrimination claims against you.    Policies, therefore, must always be implemented and monitored effectively. Also consider putting systems in place to cover different scenarios: for staff reporting in to managers; managers reporting to HR; managers communicating with absent staff or handling their return-to-work.   Line managers should likewise be tasked with keeping an eye on staff attendance levels and taking action if certain ‘trigger’ points are reached.   For example, are they aware of when the company is entitled to contact an employee by telephone if there are perceived to be problems? At what point can staff members be visited at home? Under what circumstances is it necessary to consult an occupational health adviser?    Effective computer systems can highlight patterns of absence and bring them to managers’ attention, enabling them to take action if, say, an employee has more than a set number of days off in any 12-month period or more than a certain number of days off consecutively.   Reviewing sickness absence policies   Ensure that your sickness absence policies are reviewed on a regular basis. Ask yourself if they are working effectively? If the main emphasis is on coping with the effects of absence, it may be beneficial to re-work them in order to place more weight on identifying causes and helping staff come back to work more quickly.   Think about ways in which you could change your working environment or offer benefits that might help staff to lower their stress levels and improve their health.   If you can afford it, offering subsidised gym membership or other sports facilities is one option. Companies offering such schemes have certainly reported fewer absences and fewer stress-related medical complaints.    Bringing your dog to work   It may still be unusual in the UK, but US-based research (where around 75% of all companies allow employees to bring their dogs to work) suggests those offices that welcome canine companions see dramatic improvements in morale, lower stress levels, enhanced co-operation between colleagues and a drop in absenteeism.    A Connecticut-based national trade group surveyed small and large companies across the US, including law firms, ecommerce companies and retailers. The results showed that those with pets around had lower absenteeism rates, employees who were more willing to work overtime and higher overall sales.    The American Humane Association also reports that taking Fido to work contributes to increased staff morale, productivity and camaraderie. And remember that happier and less stressed employees lead to better job performance.   You’ll need to devise a policy, of course, but for many businesses, the practice of allowing pets at work has proven to be hugely beneficial.  Helping staff return to work   Where a member of staff is absent for an extended period, say, more than four weeks, consider initiating an action plan to help them return to work safely. The plan could include activities such as a medical assessment or physiotherapy, with the aim of assisting them in making a quicker recovery.   If the employee is unable to go back to their original duties for the time being, evaluate whether it is possible to offer them alternatives while they recover. With the assistance of an occupational health professional, they may be able to make a gradual return to work.    Another option is to offer a balance of office- and home-working until the individual is able to return to their role full-time.   But make sure that any return-to-work programme is carried out in consultation with the employee concerned as well as with medical advisers. Also be aware of the possibility that their condition may fall under the Disability Discrimination Act. Therefore, always take advice before undertaking any interventions.   Conducting return-to-work interviews   All staff members should be subject to a return-to-work interview in order to help discourage absences that are not genuine. Such interviews also enable managers to identify possible problems earlier than if sickness absence was not monitored.    Many sickness absences are related to stress and often the individuals themselves are unaware that their illness was caused by workplace pressure. Discussing employees’ absence with them can help to identify these issues and enable an early intervention.    On the other hand, if you do not already have a sickness absence programme in place, now could be an ideal time to develop one.   As the current economic climate has seen many areas of the business slow, you may find that people are both more willing and have more time to devote to internal policy matters. And what better way to prepare the organisation for an eventual upturn than to ensure that your sickness absence policy house is in order?  Kate Watson is an assistant solicitor at legal firm, Curtis Law LLP.  The second part of this three part series will explore how to deal with 'problem' absences, while the third will address the increasingly common problem of presenteeism.

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By peter cutler
17th Jul 2012 14:25

This has to be the best 'long' blog I have read to date. Most of them make me want to go and lie down after 2 paragraphs - but not this one.

Why do so many employers say they have a 'fully engaged and implemented sickness absence policy' when they don't?

Why do the same employers say they record and manage absence properly - when they actually rely on retrospective data usually from managers who may have a vested interest in giving late/inaccurate information to HR?

Absence is a big subject now - but most people I talk to in either HR or Finance say their approach is 'fine'. In many case they let slip a fact or system detail which tells me their approach is anything but fine. If Absence is not an issue why is it such a hot topic?

Give employees proper boundaries when it comes to company expectations of attendance and  obligations to  their employer when they cannot come into work - and stick to them. We all know that clarity is essential, so why do so many managers or HR teams fudge around the issue? Fear of litigation, and the dreaded tribunal, that's why. What companies do not realise that if there are proper policies and  absence recording systems in place, then both employers and employees will benefit.

In my view absence and attendance should be one of the key performance indicators for all managers. So, do not let them control absence recording, and certainly don't leave them to do RTW interviews on their own!

If an effective procedure is in place, sickies will reduce because staff know they are being properly monitored. but, Even more importantly, those staff who need help and support will get it - when they need it ( perhaps on day 1) and not when it's no longer relevant. The result? Staff feel valued and supported: productivity and morale rises. Absence costs fall. Return on investment? Huge.

Peter Cutler

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