Combating presenteeism

Many businesses ignore ‘presenteeism’ even though it can have a big impact on productivity. Susie Griffin and Kate Markland explain why companies need to consider the wellbeing of staff.

Every company desires to improve efficiency and profit. It therefore remains a puzzle that many companies measure the costs, impacts and causes of absenteeism, but choose to ignore the far greater impacts and costs of presenteeism. Presenteeism is defined, in simple terms, as employees who are at work in “body” but not in “mind”.

Reticence to measure presenteeism could be put down to the complexity of the capture and analysis of this metric. However, just because it is difficult to measure, doesn’t negate the fact that it exists. The productivity losses derived from presenteeism can add up to a 25 per cent reduction in productive time available and amount to three times the costs of absenteeism.

A case study in 2015, undertaken with a utility company (500 site employees), revealed that 26.94 per cent of productive time was being lost; however, 89 per cent of that lost time was due to presenteeism and only 11 per cent was due to absenteeism. This resulted in a combined deficit impact of £3.88 million per annum.

If any other part of a business’s performance was haemorrhaging money at this level, there is no doubt there would be a significant push to reduce or eliminate this black hole.

Businesses also need to consider the changing demographic climate and human factors in today’s workforce.

First is the ageing population: 10 million people in the UK are more than 65 years old. The latest projections are for 5.5 million more elderly people in 20 years’ time and the number will have nearly doubled to around 19 million by 2050.

Second, the customary retirement age has been phased out; retirement age is now when an employee chooses to retire. Furthermore, from December 2018, the state pension age will start to rise for men and women to reach 66 by October 2020, with additional increases planned to raise the state pension age from 66 to 67 between 2026 and 2028.

Third, healthy life expectancy has not increased as quickly as life expectancy, which is resulting in an ageing workforce and general population requiring proportionally greater demands for healthcare and social services, which are struggling to keep pace.

By default, this means that companies will need to pick up the provision deficit either directly or indirectly by carrying the cost of poor health and wellbeing in their workforce.

While businesses may be hesitant to expand health and wellbeing interventions because of concerns over costs, when they link chronic conditions to lost time and its productivity consequences, they may consider rethinking their health and wellbeing management strategies.

Most health and wellbeing programmes are implemented with a scattergun approach, providing employees with a little bit of every¬thing (or a lot of everything dependent on the budget) from fruit bowls and subsidised gym memberships to in-house activities. But do they inspire behavioural change, will they invoke long-term benefits, do they engage only the already healthy and, principally, do they meet the actual needs of employees and can their impacts be measured?

As noted, the complexities of carrying out root cause analysis for health and wellbeing often deter companies from undertaking the analysis; understanding the business’s employee topography can come only from engaging with a large number of the workforce – which requires resources, time and sensitivity.

For businesses to understand their health and wellbeing priorities, it is essential to establish the following:

• health and wellbeing conditions and their prevalence within teams;
• impact factors affecting teams;
• key priorities and identification of critical elements to countenance;
• impact on lost time of presenteeism due to health and wellbeing conditions;
• cost to the business of presenteeism and absenteeism due to health and wellbeing conditions;
• correlation against human resources data for absenteeism;
• the business’s performance against national and international databases.

Once the above have been established, the business will have a secure, functional and meaningful foundation upon which to build a “being well” programme.

Consequently, this will more likely lead to greater optimisation and engagement, with long-term and short-term dividends in terms of behavioural change, value on investment and return on investment.