New research shows sickness costs UK companies 20.9 billion a year

New research shows sickness costs UK companies 20.9 billion a year, whilst fraudulent sick days are costing employers 3.5 billion.

However pioneering Big Brother software is set to catch those guilty of fraudulent illness.

A survey of 2139 employers by Peninsula the Employment Law Consultancy has shown that fraudulent sick days are costing businesses 3.5 billion a year, and 81.6 million days annually are lost due to bogus sick days. The research also shows that in general, the problem of absenteeism is costing UK firms 20.9 billion a year, a loss of 480 million days annually.

Mike Huss, Employment Law Director at Peninsula, provides quote and comment

Employee absence through sickness has increased steadily in recent years. Whether it is genuine or bogus sickness, the cost to companies is 20.9 billion a year whilst Peninsula research released today calculates that 3.5 billion of this is bogus.

Through the research we have found an increased number of workers are calling in absent compared to previous research we carried out in 2002. The average number of sick days taken in 2002 by workers was 8 days, that figure has now risen to twice as much and is now 16 days. This has resulted in 480 million days lost through absenteeism. A business is not only losing money through payment to absentees but also through productivity lost.

According to employers questioned most sick leave is blamed on the flu and its side effects. However employers are becoming wise to their ways and new trends such as reoccurring days off, i.e. Friday and Mondays resulting in extended weekends, are on the increase. Many employers have experienced an increase in the number of staff taking absent days when special events are taking place, such as sports events etc. As more people are getting away with calling in for bogus sickness reasons their colleagues are starting to follow suit. The attitude ìsomeone else is getting away with it so why canít I?î is fast becoming the way in which employees think towards absenteeism.

Following the concerns of employers Peninsula has spent 755,000 in developing Peninsula BusinessWise a pioneering computer tool for employers that identifies fraudulent absenteeism patterns. We know employers are busy and may not be aware of the working patterns of their workers. We have created BusinessWise to keep track of workers hours, what they are doing, and it will alert employers to discrepancies, it acts as a Big Brother and will alert you if it thinks something is suspicious. Itís been tried and tested with a number of companies and we are beginning to see a reduction in absenteeism within these businesses i.e. helping employers to combat bogus illness. We are confident that employers monitoring absenteeism through the BusinessWise system will deter workers when determining whether to call in with a fake illness. If the employee is constantly under watch they may feel as though the chances of getting away with bogus sickness are limited. The threat of an interview, when the employee returns to work, may deter them from calling in sick. BusinessWise advises and guides management into what questions they should ask and what action they should take, helping to deter employees further.

BusinessWise is backed up by HR advisers who will advise employers on a 24 hour basis regarding what action to take once BusinessWise alerts them to a potential problem. This will also ensure the correct procedure when disciplining the individual. This reassures the employer and provides peace of mind so they donít end up at Employment Tribunal.

Employers need to take action against bogus illness. It is all too easy for an employee to ring in sick, they still get paid for it and there is no follow up regarding the excuse as to why the employee was off. Return to work interviews should be enforced to give the employer and the employee the chance to sit down and discuss why they were absent from work. This can dissuade employees from calling in sick, when bogus, as a sense of guilt may hold them back. The employer must make it known that bogus sickness will not be dealt with lightly, however this seems to be the struggle with many companies. How can the employer be sure as to what is bogus and what is genuine.

Summary of the survey:

- 17% of all company sickness is bogus
- Sickness cost businesses 20.9 billion
- Bogus sickness costs employers in the UK 3.5 billion
- 81.6 million work days are lost in one year due to bogus illness
- 480 million days are lost in total due to absenteeism