Sickness absence and presenteeism in small businesses

Employees are an important part of any business. But in SMEs, a smaller team means that your people are even more vital to the overall success of your business. So when a team member is off work due to ill health, it can have a noticeable impact.

However, employees turning up to work despite being unwell could be having an even bigger impact on your business than sickness absence.

Sickness absence in small businesses

According to figures from the ONS, 141.4 million working days were lost due to sickness or injury in the UK in 2018. Of these lost days, the biggest causes of absence were¹:

• Minor illnesses (27.2%)
• Musculoskeletal problems (19.7%)
• Other (including accidents, poisonings, infectious diseases etc.) (13.7%)
• Mental health conditions (12.4%)

It’s no surprise that staff sickness absence can have a negative effect on small businesses. However, the extent to which it may be costing them can often go undocumented. According to one study, over 70% of businesses admitted that absence has a direct effect on profitability although more than a third of these have no idea how much absentees have cost them².

What is presenteeism?

While much attention is often paid to the rate of sickness absence within an organisation, presenteeism levels can often fall under the radar if it goes unnoticed.

Presenteeism occurs when employees attend work despite being unwell. This could be as a result of issues with their physical or mental health. Unlike with sickness absence, presenteeism can be hard for employers to spot amongst their team, as they may not notice any symptoms or indications that someone is unwell. However, presenteeism may be more common than some business leaders and managers may think. According to a 2018 CIPD report, 86% of over 1,000 respondents said they had observed presenteeism in their organisation over the last 12 months, compared with 72% in 2016 and 26% in 2010³.

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How can presenteeism affect a small business?

While it can be a common misconception that employees being absent from the workplace is more costly to a business than if they were at work, presenteeism could be impacting a business just as much or even more. However, unlike sickness absence presenteeism can often go unnoticed. This can make its impact hard to measure. Despite this, a Health at Work Economic Evidence Report found that, for every £1 cost to a business of absenteeism, there’s estimated to be an additional cost of £2.50 due to presenteeism⁴.

As well as the financial impact on a business, presenteeism can also have adverse effects for the rest of the team who are left to pick up the workload for their colleagues who are present at work despite being unwell. This could therefore have a negative impact on the overall productivity of the business.

Can sickness absence and presenteeism be reduced?

While a certain level of sickness absence is unavoidable, there are ways in which small business owners can work to improve the overall workplace culture which may benefit sickness absence and presenteeism levels. These include:

• Offer the option of flexible working - According to research by Moorepay, around 72% of business owners believe that introducing policies such as flexible working, time off for family reasons and return to work programmes could reduce the rate of absenteeism by as much as 11% or more⁵.
• Allow employees to switch off – Encouraging employees to switch off outside of working hours is important to give them time to relax and recover from the stresses and strains of work. Avoiding emailing your team outside of working hours, encouraging them to take a lunch break and ensuring that they aren’t regularly staying in the office late into the evening are all ways in which you can help your team to have a positive work-life balance.
• Encourage a culture of open dialogue – Ensuring that your team feel comfortable opening up to their line manager when they may be struggling with workloads etc. can help to encourage a culture of open dialogue. This can help to ensure that members of the team are asking for help when they need it.
• Practice healthy work-life balance behaviours - As the owner of the business, members of your team may be looking to you to gauge how they should be behaving in the workplace. Demonstrating positive work-life balance behaviours, such as leaving the office on time and taking a lunch break, can encourage the rest of your team to follow suit.
• Allow employees to rest when they’re unwell – If an employee is off work due to ill health, it’s important to allow them time to rest and recover without the stress of worrying about work. According to one study, over a third of employees admitted that managers often put pressure on them to return to work before they’re ready, with 52.9% of managers still contacting their employees whilst off sick⁶.

While the impact can be hard to measure, developing a health and wellbeing strategy within your business can be beneficial to absenteeism and presenteeism levels. It can also have benefits for your business too. According to one survey, respondents reported that their organisation’s health and wellbeing activity had positive effects including better employee morale and engagement (44%), a healthier and more inclusive culture (35%) and lower sickness absence (31%)⁷.

How we can help

At AXA Health, we believe that the best way for you to get the healthcare cover that's right for your business and your team is to let you build your plan yourself. Whether you want quick access to diagnosis and treatment, or mental health support for the pressures which come with your area of work. Simply pick the cover options that you'd like to create a plan that works for you*.

Regardless of which options you choose, you'll have unlimited access to our 24/7 online GP service, AXA Doctor at Hand (powered by Doctor Care Anywhere), as standard. AXA Doctor at Hand gives you and your team a 20 minute appointment with a GP at a time and place that works for you - 24/7, 365 days a year. Appointments are subject to availability. Doctor Care Anywhere's fair usage policy applies.

Find out more about our small business health insurance, including what is and isn’t covered, and get a quote today.

*If you are buying cover for 1-2 people only, you will need to include either the Treatment option or the Diagnostics Only option in your plan.

Sources and references

¹Office for National Statistics, 2019

²Moorepay

³CIPD, 2018.

⁴Health at Work Economic Evidence Report, 2016.

⁵Real Business, 2017.

⁶CV Library,2016

⁷CIPD, 2018