If you read nothing else, read this …
• Third-party absence management systems involve staff reporting absence to a trained nurse or healthcare professional. Data is then fed to the employee’s manager.
• Opinion is split over whether technology-based reporting platforms are superseding third-party absence management systems.
• Third-party systems can manually record sickness absence and identify patterns.
• The systems can help employers identify early health interventions.
Case study: East Sussex County Council rates third-party sickness scheme
East Sussex County Council used a third-party absence management system as part of a wider strategy to reduce its sickness absence rates, from 9.5 days in 2005 to 6.9 days in 2010.
The system, provided by FirstCare, was introduced with the specific aim of tackling short-term absence.
Leatham Green, assistant director, personnel and training in the council’s governance and community services department, says: “We had previously relied on manual recording of absence data, which tended to be several weeks out of date and incomplete.”
In October 2009, through an initiative called Invest to Save, Green secured council funding for a pilot project involving an outsourced absence management service, focusing on two areas: adult social care and children’s services.
By the end of 2010, sickness rates had fallen by an average of 11%, and the scheme was deemed popular by management and staff.
“The scheme initially met with a negative response, particularly from trade unions, but they are now fully supportive,” says Green. “In the current climate of budget cuts, it is one service we are being asked not to stop.
The cost benefits are clear and there is added value in that managers are engaging more effectively with the workforce, while staff feel valued by an employer which cares about their health and wellbeing.”
Do third-party absence management systems produce the best results, or are automated, technology-based schemes a better bet? Alison Coleman reports
A climate of austerity is forcing employers to look ever more closely at their staffing costs and redouble their efforts to reduce sickness absence.
According to the Confederation of British Industry’s (CBI) Healthy returns? Absence and workplace health survey 2011, published in May 2011, the average rate of absence in 2010 was 6.5 days per employee, costing £760 for each absent employee that year.
The challenge for employers is to find absence management solutions that are both effective and employee-friendly. Third-party systems through which staff report absences to a trained nurse or healthcare professional, triggering a workflow that drives the absence information to the manager, have proved effective on both counts. But opinions are divided on the merits of such services, and whether they are being superseded by cheaper automated technology-based absence reporting platforms.
David Prosser, strategy development manager at Axa PPP Healthcare, says nurse-led services can be costly and overlook the fundamental point that sickness absence is a management issue, not a medical one.
“When you consider the average cost of these systems is £50 to £60 per employee per year, for many employers they are not financially viable, especially when compared with a fully automated absence recording platform at around £10 to £15 per employee per year,” he says. “These provide the same data that enables managers to identify and deal with absence trends.”
Systems managed by health professionals
But Mary Rafferty, head of health risk services at Bupa Health and Wellbeing, says the benefits of systems manned by health professionals go beyond costs and data capture. “Third-party systems offer employers impartial insight into the health risks facing their employees, allowing them to address work-related causes of ill health before they develop into causes of long-term absence.”
Against a backdrop of financial pressures, employers considering a third-party system will look closely at the costs and returns. Aaron Ross, chief executive of absence management specialist FirstCare, says the savings made through absence reduction mean the scheme can pay for itself. “We are confident of achieving a 10% reduction, but in reality, rates of 22% are typically achieved, with year-on-year improvements that can see a 35% reduction by year three,” he says. “It also eases the burden on line managers to manually record absence by providing data that identifies patterns and trends.”
Employers that provide health insurance can use a system to help their cover achieve more by identifying earlier interventions. Bupa’s Rafferty says: “Where illness is directly related to the workplace, or appears to be caused by an underlying condition, the case is immediately escalated to a clinical case manager. Symptoms and the employee’s medical history are considered to ensure the most effective measures are employed.”
Dr Wolfgang Seidl, head of health management consulting Europe, Middle East and Africa (EMEA) at Mercer Health and Benefits, says a management system with a human voice is likely to be more effective than a computer, and may also deter staff from throwing ‘sickies’. “It is how the employer uses it that determines how effective it will be,” he says. “Data capture is important and a pure technology-based system would provide that, but employers must do something meaningful with data.
“Organisations that use nurse-led absence management schemes and offer occupational health, employee assistance programmes and other health and wellbeing benefits have an opportunity to provide an integrated response to foster a culture of health and manage all employee sickness absence issues.”
Losing ‘Big Brother’ connotations
Success also depends on the way a scheme is presented to staff, says Sandra Dalchow, a senior consultant at Lorica Employee Benefits. “The idea of having to report absence to a third party rather than their line manager will have an impact on employees, but by promoting it as a support service, it loses any ‘Big Brother’ connotations and becomes valued as an employee benefit,” she says.
Employers must also be clear about what they are trying to achieve from a third-party system, says Ann Dougan, marketing director at Cigna Healthcare Benefits. “Are they concerned they have a serious absence problem, or is it more about health risk? Are they seeing a lot of musculoskeletal problems or stress-related issues? Whatever method of reporting they use, it is important the person doing the recording knows the triggers, so staff can be referred to support services.
“Once employers get used to a third-party system, they could become reliant on it, but as long as it is affordable, they may want to maintain it as part of their overall employee health and wellbeing strategy.”
Managing for performance
• The CBI’s Healthy returns? Absence and workplace health survey 2011 revealed that 95% of organisations have a formal absence management policy in place.
• More than one-third of employers generally and about half of those in the public sector have set clear targets for reducing absence this year.
• Other employers steer clear of setting targets on the grounds that these run the risk of sending out a message that levels of absence below the target are acceptable.
• Employers should keep managers focused on minimising all absences.
• Line managers play a central role in managing employees’ absence and their resumption of work.
• The research found that non-genuine sickness absence is believed to account for 16% of all working time lost to absence on average, at a cost of more than £2.7 billion.
• In the past year, most organisations have taken disciplinary action against at least some employees because of poor attendance.
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