Barriers and Success Factors in Absence Management - CIPD

Barriers and Success Factors in
Absence Management
Dr Mark Simpson
AXA PPP healthcare
CIPD 18 th June 2004

“Our employees are our greatest asset. I
say we sell them”.

Today’s topics
1. What’s the big picture
2. Sickness absence and human health behaviours
3. Managing absence – what works
4. Case management and the role of occupational
health services

What’s the big picture
• Absence levels
• Unpaid overtime
• Health & productivity

Absence costs – what’s the bidding
• £ 11.6 billion – CBI

Absence costs – what’s the bidding
• £ 11.6 billion – CBI
• £ 13.8 billion – CIPD

Absence costs – what’s the bidding
• £ 11.6 billion – CBI
• £ 13.8 billion – CIPD
• £ 39.0 billion – Norwich Union

But - Unpaid resource………
• 23% of people work extra hours every day
• 64% stay late at least once a week
• Half of all workers take work home
• 40% “find it necessary to work weekends”
• 45% of overtime is unpaid (Abbey National
Survey)
• Britons work 5.2 hours extra per week
(Labour Force Survey)

Lost hours…..
• Since 40% of overtime is unpaid,employers
get 2.1 hours per week free
• This equates to £1065 per employee per year
• Or £26 billion “free” to employers
• Or more than twice that “lost” through
sickness absence

Health, Productivity and Presenteeism
• “Presenteeism” = The degree to which an
individual is present while working
considering their health”
• For depression, lost productivity costs are x5
as great as absence costs

Knowledge Capital vs Labour Costs
Low
Knowledge Capital
High
High
Labour Costs
Low
Insurance Sales
Force
McDonalds
Microsoft
Aston Martin

Human capital costs

The economic burden of health and disease is
measurable on the bottom line
• ………..but you need the data to prove it!

Sickness absence and human health
behaviours

Two questions for you to consider
1. When did you last have a 2 week holiday
2. Have you ever been off sick for 4 weeks or longer

Nobody said this was easy!

Prevention - Key Messages
• Sickness Absence is not necessarily about
being ill
• Absence is determined by health
behaviours as much as by health per se
• Previous absence usually predicts future
absence
• Medical conditions/diagnoses will not
predict future absence

• You won’t have to manage absence (as
much) if you recruit the right people……...
• ……but you may have to manage presence
and productivity

Taylor - Contrasting absence patterns in an
oil refinery (1967)
Four groups of employees
• Frequently sick ( 5+ spells/year)
• Long term sick ( > 60 days/year)
• Never Sick ( No absence in 8 years)
• Control group

Key Findings
• Pre-employment health non-disclosures distributed
evenly amongst all absence groups
• Absence groups correlate with other employment
behaviours ­ lateness,occupational injuries
• Frequently sick had x3 absence spells as controls but
no difference in distribution of illness causes
• Never sick almost unanimous in enjoying their work
• 30 % of never sick had significant medical problems
• Personality traits were associated with different
absence groups
• Never Sick - Introversion
• Long Term - Neuroticism
• Frequently - Extroversion

The real “Hawthorne Effect”
• 1927 - 1932 Hawthorne Plant, Western
Electric Company, Illinois

The real “Hawthorne Effect”
• 1927 - 1932 Hawthorne Plant, Western
Electric Company, Illinois
• Led by Harvard Business School
Professor Elton Mayo

The real “Hawthorne Effect”
• 1927 - 1932 Hawthorne Plant, Western
Electric Company, Illinois
• Led by Harvard Business School
Professor Elton Mayo
• Initially study intended for 1 year but
extended to 5 years - why

What did the studies show
• Initially intended that study should investigate
physical/environmental effects of workplace
• lighting
• temperature
• humidity

What did the studies show
• Initially intended that study should investigate
physical/environmental effects of workplace
• lighting
• temperature
• humidity
• Then moved on to psychological aspects
• breaks
• management style
• working hours
• self determination

Results
• Everything worked!
• Which is why the study lasted 5 years

Results
• Everything worked!
• Which is why the study lasted 5 years
“The need for recognition, security and sense of
belonging is more important in determining
worker’s morale and productivity than the
physical conditions in which they worked”

Managing absence - what works
An idea
Absence is
managed

A Caveat ­ is this real research
“There is a tendency in much of the published
literature to assume the proven validity of certain
approaches and to focus any evaluation entirely
on the frequency of it’s use - i.e. to evaluate the
extent of consensus rather than the
effectiveness of the policies themselves”
BOHRF/Anne Spurgeon 2003

Health Vs HR Interventions for Absence
Health
Health Awareness
Health Promotion
Health Risk
Assessments
Private Intervention
Risk Assessments
Stress Management
Occ. Health Strategy

Health Vs HR Interventions for Absence
Health
HR
Health Awareness
Recording absence
Health Promotion
Health Risk
Assessments
Training/Supporting
Managers
Sick pay structure
Private Intervention
P & D Reviews
Risk Assessments
Stress Management
Occ. Health Strategy
Recruitment/Selection
procedures (DDA)
Absence strategy
HR Board
Representation

Case management and occupational
health services

Different perspectives – where is the
common ground
• FD - wants to minimise costs
• HR - wants to compete at recruitment
- wants to manage absence
• Intermediary - wants to broaden product portfolio
- gets involved in contentious claims
• Line manager - wants employee back asap
• Employee – varying commitment and motivation
• GP - wants to get best deal for patient
• Union rep - wants to manage employee interests
• Lawyer - adversarial relationship
• Insurer - wants to minimise claims liability

The athletic model - what can be done
• Athletes generally recover from injuries quickly
• Results from treatment model in which common
recovery goal shared by all
• Clinicians aiming for functional not medical
recovery
• Coach / Manager plans return programme
• Team members supportive
• Like for like injuries x3 faster return to work when
athletic rather than occupational causation

Integrated Healthcare Management
Employee
assistance
programme
Occupational
health
Case
Management System
Employers
liability
CLIENT
Health and
Safety
Private
Medical Cover

Case management principles
1) Early Capture of Events
Manage Expectations and Timeframes
2) Case Management
Reduce Recovery Delays +/- Illness Behaviour
3) Treatment Pathways
Ensures Consistent Clinical Management
4) Intervention Outcomes
Data Warehousing
5) Co-ordination of Events
Allows Alignment and Integration of these Processes

Integrating Multiple Programmes for
Maximal Benefits
Best practices for
controlling costs
also control absence
Return to
Work
Policies and
Practices
Common
Case
Management
Single Point of
Intake and Claims
Reporting
Single Internal
Programme
Manager

……..and to finish...
….a short quiz!

The following short quiz
consists of 4 questions and
tells whether you are qualified
to be a "professional".
The questions are not that
difficult, so don’t cheat by
looking ahead!.

Question Number 1
How do you put a giraffe into a refrigerator

The correct answer is:
Open the refrigerator,
put in the giraffe and
close the door.
This question tests
whether you tend to
do simple things in an
overly complicated
way.

Question Number 2
How do you put an elephant into a refrigerator

Wrong Answer: Open the
refrigerator, put in the
elephant and close the
refrigerator.
Correct Answer:
Open the refrigerator, take out
the giraffe, put in the elephant
and close the door.
This tests your ability to think
through the repercussions of
your actions.

Question Number 3
The Lion King is
hosting an animal
conference. All the
animals attend
except one. Which
animal does not
attend

Correct Answer:
The Elephant.
The Elephant is in the
refrigerator.
Remember
This tests your memory.

OK, even if you did not answer
the first three questions correctly
you still have one more chance
to show your abilities.

Question Number 4
There is a river you must cross. But crocodiles inhabit it.
How do you manage it

Correct Answer: You swim across. Why
All the Crocodiles are attending the Animal
Conference.
This tests whether you learn quickly from your
mistakes.

According to Andersen Consulting Worldwide,
around 90% of the professionals they tested got
all questions wrong.
But many preschoolers got several correct
answers.
Anderson Consulting says this conclusively
disproves the theory that most professionals
have the brains of a four year old.

Thank you!