Why the UK’s disastrous sickness benefit rates bode badly for the economy | Business


EasyJet is removing seats from its planes, Tui is no longer serving meals on flights and bus companies are reducing their services. From the headlines, Britain appears to have a big sickness absence problem as Covid adds to staff shortages in the economy.

But these incidents aside, the overall situation is very different. Thanks to low sick pay – now back to pre-Covid levels despite Boris Johnson’s pledge to ‘build back better’ after the health emergency – Britain has among the fewest working days lost to disease in the developed world.

Sickness absences rose last year as the economy reopened, compared to a record low in 2020 when the pandemic reduced socializing and people could continue to log on from home despite being sick. However, despite falling from 3.6 to 4.6 days per year, the average number of days lost to illness has steadily fallen – from seven per year in the mid-1990s. Even with Covid and a larger workforce, almost 36 million fewer working days were lost in 2021 compared to 1995, down one-fifth to 149.3 million.

Critics say the government missed a golden opportunity in last week’s Queen’s Speech to bolster workers’ rights, and Johnson’s party is running out of ideas to address the cost of living crisis. After his landslide election in 2019, he promised a jobs bill but, to the chagrin of unions and employer groups, did nothing last week.

sickness rate in uk

“If the period after a pandemic, when the inadequacy of the system has been highlighted, is not the right time, when is it?” said Rachel Suff, policy adviser at the Chartered Institute of Personnel and Development (CIPD). A survey of 6,000 workers by the professional body for HR professionals found that in the last three months almost half of employees went to work when they did not feel well enough to fulfill their functions. The CIPD affirms that fixing sickness benefits should be a top priority for workers and employers. Suff said: “Absence figures obscure the true picture of the health of the working-age population.”

Sickness absence rates in Britain are less than half the European average and closer to those in developing countries such as Turkey, Armenia and Azerbaijan.

Employment experts say the reason is sick pay, where the UK is also bottom of the global rankings.

sickness rate by occupation

Statutory Sick Pay (SSP) is £99.35 per week, paid by employers for up to 28 weeks. At the start of the Covid pandemic, the government started paying this from the first day of illness, but in February it reverted to being paid from the fourth day. This is one of the lowest rates in the group of wealthy OECD economies. According to the TUC, only 19% of the average UK wage is covered by sick pay. Rates are higher in Spain (42%), Sweden (64%) and Belgium (93%), while support is worse only in South Korea and the United States, where workers do not have no legal right to sickness benefit. Germans on sick leave receive their full salary for six weeks, then 70% for up to 78 weeks.

The UK government said international comparisons were difficult to make due to differences in each country’s system, and said it had improved the process in Britain with legally valid numerical “adjustment scores” replacing the handwritten notes: “As we learn to live with Covid-19,” he said, “we keep the SSP system under review.”

Cary Cooper, professor of organizational and health psychology at Manchester Business School, said that inadequate sick pay and a precarious economic environment forced people to continue working even when sick: “Since Thatcher, we have Americanized the British economy, making it less secure and less secure. offering less protection than other countries.

int comp disease rates

The leading American-born psychologist, who coined the term ‘presenteeism’ in the 1980s to describe the need to be at work even when not fully functioning, said an inadequate safety net was at short-sighted and bad for productivity. “My view is that the more you treat people right, like and trust them, protect them and provide them with some security – not 100% but some – the more you will benefit from it.”

Experts warn there are gaping holes in the system. Neither Britain’s 4million self-employed nor employees earning less than £123 a week qualify for SSP. No less than 2 million fall into this last category, 70% of whom are women.

Some employers offer occupational sickness benefit schemes, but the prevalence of these has dropped dramatically since the introduction of the SSP under the first Thatcher government. In the early 1980s, 90% of employers offered this benefit, but after decades of decline, the Department for Work and Pensions estimated in 2014, according to the latest available data, that 26% of workers relied solely on the SSP, while 17% did not. know what they were entitled to.

sickness benefit coverage rate

Occupational schemes are concentrated in the highest-paying sectors, leaving factory and retail workers and carers – among those least likely to be eligible for SSP in the first place – at the mercy of support inadequate state. As better-paid workers in the service sector continue to work at least in part from home – a factor that drove sickness absences down in 2020 – critics warn that a two-tiered perspective for good workplace health is emerging. “It’s a class issue,” says Kate Bell, head of economics and rights at the TUC.

In real terms, the SSP rate is lower today than when it was launched in 1982. Unions and business groups say it needs to be brought closer to the real £9.90 living wage of the hour and £11.05 in London – the equivalent of £361.35 and £403.33 for an average working week.

“No one should have to choose between putting food on the table or doing the right thing and staying home when sick, but that’s exactly what millions of workers across the country are facing. “, Bell said. “Time and time again we have warned ministers that sick pay is not enough to live on. It is reckless and counterproductive for Ministers not to have fixed our broken sickness benefit system. Enough is enough.”


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