Sep 164 min read

The Hidden Costs of Employee Sickness: How a Healthier Workplace Can Boost Your Bottom Line

Employee sickness is more than just a temporary setback—it’s a growing concern for UK businesses, with the cost of absences surging to £100 billion annually. In this insightful guest blog, Nadia DiLuzio, from The Mindful Business Co, explores how businesses can reduce this rising financial burden by fostering a healthier, happier workplace. Beyond the numbers, Nadia highlights simple, cost-effective strategies that promote wellbeing, increase productivity, and create a work environment that everyone enjoys—without requiring significant financial investment. Discover how small changes can make a big difference for your team and your business.

The Real Cost of Employee Sickness

Thank you to the Lilac HR team for inviting me to contribute a guest blog. What a great topic too, one that would be easy to explore from a £ perspective, considering the Institute of Public Policy Research (IPPR) has recently put a figure of £30M on the increased cost of employee sickness to UK businesses in its 2024 report. That is an increase on a cost already estimated to sit at around 100 Billion a year.

We also know that absence levels from work have risen by 55% in the last five years, and we can attribute the impact of the pandemic on both our physical and mental health to some of the rise over that period. But what if we stopped looking externally and spent some time focused on what is impacting absences in your business specifically.

The clever people at Oxford University concluded in a recent study that a happy workforce contributes 13% more to the bottom line. If we broaden that out and say a happy workforce is likely a product of a healthy workplace, thus the two go hand in hand, we can start to look at what we can do to create a healthy working environment.

And before you think how much will this cost, I don’t believe this needs to cost you money (unless you’d like to spend in this area) or be hard to implement. It’s about communicating what you already have at your disposal, to support your team and also yourself – don’t forget you are a member of the team too.

Here are a few simple things you can do starting right now, without spending a penny:

Create healthy habits: encourage the team to leave desks at lunchtime, get away from workstations, and get outdoors if possible. There is plenty of research that shows we are more, not less, productive when we take our full lunch break.

Working through lunch isn't cool, it only feeds presenteeism, and over time that feeds burnout.

Annual leave: enjoy it! It is yours to spend doing the things you love. Make it simple and easy for your team to book time out. And lead by example, business owners and leaders need downtime too.

Great communication: provide your team with the tools they need to support their mental and physical wellbeing at work. One simple suggestion is a resource that pulls together all of the free support available across the UK. Don’t save valuable resources like this for when the team are signed off though. Early support is key, so make it available as a day-one resource and include anything you do as an enhanced benefit in this area too.

Shine a light on your People Policies: there are some incredible benefits enshrined in UK employment law that can support individuals to have the work/life balance that suits them and suits your business. Don't be afraid to share them, instead use them to empower your team to understand what is available to them.

Don’t forget to share how you will support them in those moments that can occur in any of our lives too. Whether they need compassionate leave, carers leave, or to utilise your sick leave policy, it can be reassuring to them to know what these are before approaching their line manager for a conversation.

Create a workplace that you enjoy working within: the world of work has changed significantly over the past decade. Salaries are no longer the single driver of employee retention and satisfaction. A workplace that recognises the contribution of its team, provides opportunities for personal growth and development, encourages open communication, underpinned by business owners and leaders that care about their people, are seen as significant factors in decisions to remain in our roles.

So what do I believe is the real cost of employee sickness on businesses? I believe it comes down to whether the business is seen as a contributor to it. I am not saying we don’t need to measure absences and have a process that is clear and fair on how we handle them but if I may leave you with one piece of advice, it would be this - next time you have a member of the team whose performance isn’t as good as usual, why not ask them how they are and start the conversation differently. You may be surprised at the outcome.

Nadia DiLuzio,

MBACP | Associate CIPD

nadia@themindfulbusinessco.com

Insta: @themindfulbusinesscompany