Why data matters for absence management
29 June 2020: Ian Caminsky, CEO of FirstCare, shares his advice on the processes they can adopt in response to systemic unplanned leave.
Good absence management starts with data. By understanding the reasons why employees take time off work, which can be unique to each business, Executives can identify and address absence trends.
It is understandable that at some point during the working year, an employee will fall ill, or be unable to carry out their duties for personal reasons. However, we also know that there are often systemic issues facing employees that can lead to prolonged periods of absence.
Unplanned employee absences cost businesses in the UK more than £63.4bn in 2019. A lot of that could have been avoidable with the right data.
As an example of the financial savings studying data can bring, let's look at musculoskeletal health. Musculoskeletal issues have been the leading cause of UK working days lost to absence during eight of the last ten years, surpassed only by mental health issues since 2018.
There has been a 19% increase in musculoskeletal-related absence over the past five years, and we estimate that in 2019, unplanned absence due to musculoskeletal problems cost the UK economy more than £7.1bn.
Anglian Water, a utility provider with many physically challenging, manual job roles, used data to identify musculoskeletal absence in its workforce. They were previously losing more than 5,500 days across 5,179 staff in 2017, at a cost of around £790,000.
Recognising the impact, Anglian Water proactively opted for a new private medical insurance provider that offered fast-track physio services for its members.
An alert, set up via our service, was triggered each time an employee recorded a musculoskeletal absence, notifying them of the fast-track physio provision. As a result, Anglian Water has seen a 12% reduction in absences due to musculoskeletal issues within three years. It saved them more than £80,000 between 2017-19 alone.
The average duration of musculoskeletal absences at Anglian Water has increased. With overall absences down, this suggests that its proactive intervention is addressing the causes and recurrence of shorter 'modifiable' absences. In line with this, the percentage of staff recording repeated musculoskeletal absences within a 12-month timeframe has fallen 6.9% since 2017.
This type of financial saving when absence is addressed is not unique to this organisation. By taking the simple step of harnessing data and insights, alongside early intervention and robust return to work processes, it can be achieved by all organisations.
Early intervention matters
The economic case for early intervention in healthcare is well established, but still not widely adopted. A report from the World Health Organisation in 2014 on 'The Case for Investing in Public Health' cited several workplace studies that prove the link between early intervention and financial savings.
A London School of Economics study from 2011 investigated the benefits of workplace screening for depression and anxiety disorders. The researchers found that intervention cost £20,600 for every 500 employees in the first year. But this upfront cost was offset by savings of £19,700 in year one and £63,500 in year two.
At FirstCare, we work with businesses to introduce early invention by integrating absence reporting with a nurse-led service. Clients' employees call us to report unplanned absences from work, and if their reason is medical, have the option to speak to a nurse.
In line with the positive findings of the LSE study, we have found that businesses that adopt early intervention practices and introduce healthcare early on, see a reduction in absence by up to 40% over three years, with an average cost saving of £519 per employee.
Return to work
Intelligent absence management also involves supporting employees reintegrating into the workforce after a period away from work.
Carrying out a return-to-work interview gives businesses a valuable opportunity to identify the future needs of individual employees, and potentially an indicator to the needs of others too – whether they be work-related or external. Our data shows that only 62% of businesses complete return to work interviews. It means that over a third of companies are missing a valuable opportunity to address and minimise costs relating to future absences.
The return to work interview is also an opportunity to strengthen employee-manager relationships and workforce morale. For our clients, we have a suite of dynamic return-to-work forms, designed to empower line managers to ask appropriate questions related to the actual reason for absence. We have found a one-size-fits-all solution can be awkward for both parties, whereas a tailored form gives focus, saves time, and makes employees feel more valued.
It is remarkably simple. For example, employees who have been absent due to stress should be asked about the elements of the role concerning them upfront, and someone who is back at work following flu should be asked questions about their recovery and ability to work at full capacity. Businesses that have the highest return-to-work interview compliance rate have more than doubled the absence reduction rate of those at the lower end.
Understanding the science of absence management can have real financial implications for businesses. The formula requires robust processes which collect valuable data and insights, mixed with a person-centred approach. Companies that follow the science and invest in absence management have seen a 21% reduction in absences in year one and made an average £519 saving per employee, as well as an increase in overall workplace wellbeing; the optimal result.