The true cost of absenteeism

Occupational Care South Africa (OCSA) reveals that absenteeism costs the South African economy around R12 billion to R16 billion per year. The Human Capital Review estimates this figure to be even higher, at R19.144 billion – this equates to about 15% of employees being absent on any given day.

While absenteeism in the workplace must be tackled holistically, there are various mechanisms that organisations can leverage to lower absenteeism rates. The benefits of implementing a comprehensive health and well-being package – that includes gap cover – in corporate financial planning packages should not be underestimated.

This is according to Tony Singleton, CEO of Turnberry Management Risk Solutions, a registered financial services provider that specialises in accident and health insurance, travel insurance, and funeral cover.

“Without gap cover, many employees either can’t afford to pay hospital co-payments or charges that are above medical aid rates to receive the treatment they need. This is further exacerbated in a workplace environment where there is a fear of a loss of employment, or in jobs where there is no protected time off, meaning that if you miss a day or a shift you don’t get paid,” Singleton explains.

However, delaying treatment for an ailment or health condition can often result in more serious health problems, driving up the long-term cost of absenteeism to the employer. Singleton points out that when left untreated, disease progression can result in a mild ailment eventually developing into a serious illness or even a medical emergency.

“Worsening health changes the situation, resulting in the person staying off work for a longer period of time to recover from a serious condition. This means that the employer often has to pull in other employees to cover that person’s work or, in some cases, even having to hire temporary staff to handle the additional workload,” he says.

Johannesburg-based psychiatrist Dr Alexandra Maisto says it’s important that employers consider the mental health aspect that may be associated with financial stress and the impact this can have on absenteeism and the organisation. “The additional stress caused by fears of job security and the financial burden of paying for medical treatment can often result in or exacerbate anxiety, depression, and other mental health problems. This can lead to even more absenteeism,” she notes.

“This can overburden the remaining staff at work, thus increasing their risk of burnout and disengagement, and lead to further absences. It’s a bit of a chicken and egg situation where someone is being pushed beyond capacity because of other employees’ absences; they themselves feel overwhelmed and may also start being absent, thus further burdening the system.”

“From an employer’s perspective, it becomes very costly if their employees do not look after their health,” Singleton emphasises. “Gap cover can facilitate this, as employees would have the ability to access healthcare without worrying about in-hospital shortfalls, enabling them to seek medical treatment when it’s required.”