The number of Kiwis taking sick days rose last year, but a new study has found not everyone was necessarily 'sick'. Photo / 123RF
The number of Kiwis taking sick days rose last year, but a new study has found not everyone was necessarily 'sick'. Photo / 123RF
The number of days staff were absent from work last year increased to a record high, but it comes with a warning employees could lose out on other benefits.
The Workplace Wellness Report 2023, published by Southern Cross Health Insurance and BusinessNZ, found the rate of absences over the 2022calendar year increased to an average of 5.5 days per employee - equivalent to nearly 10 million working days lost per annum.
This surpassed the previous high of 4.7 absent days recorded in 2014 and 2018.
But the rise in sick days was also costing businesses and has seen the cost to the economy balloon by a billion dollars.
Southern Cross Health Insurance CEO Nick Astwick said while businesses can offer competitive salaries and other benefits like health insurance, subsidised transport or free healthy food, these were now coming under pressure.
“Eventually, something has to give. There’s only so much that businesses can do to absorb these costs before having to pass these on to customers or cut them loose,” he said.
New legislation around sick leave combined with worker fatigue were contributing factors in the rise.
The median annual cost of absence now stands at $1,235 per absent employee, or around $2.86 billion per annum for the total economy, compared to $1.85b in 2020.
“While having people know they will be supported to stay home when sick is the right message to send, the resulting challenge for businesses in both increased cost and absent staff is substantial for any business to sustain,” Astwick said.
Now in its sixth edition, the biennial Workplace Wellness Report was conducted between March and May 2023 and canvassed responses from 137 public and private organisations employing 135,742 staff.
The difference in cost to the economy can partly be explained by the number of survey respondents versus the 2021 edition. The figures also take into account the Quarterly Employment Survey average weekly earnings for fulltime employees and total FTEs as of June 2022.
The 2021 Workplace Wellness Report got responses from 116 organisations employing 95,488 workers. It showed an average number of absent days for 2020 of 4.2 – in part due to lockdowns and work-from-home orders where some employees continued to work at home despite being sick.
Contributing to the rise in absences from work last year, Astwick noted the significant shift in “paid sickness absence days being viewed as an entitlement by those suspected to be not actually sick” from 13th place to seventh.
“It’s possible this is one scenario where ‘quiet quitting’ comes to the fore, with some people making the most of the ability to take time out, just because they can, in addition to working strictly within their allotted hours,” Astwick said.
The trend of ‘quiet quitting’ has grown in the years since Covid-19 hit as workers pull back on their efforts - typically extra or unpaid work - in a bid to get a better work-life balance.
Twenty-two per cent of organisations reported instances of ‘quiet quitting’, according to the report.
It’s also been just over two years since the number of paid sick leave entitlements doubled to 10 days.
“Given the legislative change in 2021 to 10 days [of sick leave], we’ll be interested to see whether this [average number of absent days] increases in coming years,” Astwick said.
According to the study, 12.2 per cent of organisations now offered more than the required 10 sick days per year, while 3.3 per cent offered unlimited sick leave.’
Embracing mental wellbeing
The study also found New Zealand organisations are prioritising workplace wellbeing.
According to the survey’s findings, a net 49.7 per cent of firms observed an increase in stress in 2022 – the second-highest reading in the survey’s history, though lower than in 2020.
Workloads and long hours were the main causes of work-related stress.
Workloads were the top concern for 80 per cent of those in organisations with 50 or more staff, ahead of long hours (47 per cent) and change at work (45 per cent).
Outside of the workplace, financial concerns are the leading cause of stress, rising from 41.3 per cent in 2018 to 62 per cent in the most recent study.
When it comes to businesses’ approach to supporting the mental wellbeing of staff, 99 per cent of those with 50 or more staff had employee assistance programmes.
The next most common approach was allowing flexible working (82 per cent), followed by diversity and inclusion policies/practices (73 per cent) and mental wellbeing seminars (63 per cent).
Southern Cross Health Insurance CEO Nick Astwick.
The report also noted the positive impact working from home had on staff and how more organisations were embracing the trend.
“Nearly all organisations see having the opportunity to work from home, where able and appropriate, as a positive move. Many employees are happier to have more flexibility,” Astwick said.
But the report also highlighted issues including employees feeling isolated working remotely and struggling to collaborate well.
“There’s a lot to be said for the genius idea uncovered around the water cooler. I believe flexible working warrants further exploration,” Astwick said.
Seventy-two per cent of organisations with 50 or more staff said they had changed their view since 2021 on allowing more people to work from home. While not all organisations offered remote work, none had allowed fewer people to work from home.
Astwick said he was encouraged by some of the key findings in the report, despite very challenging times, and believed New Zealand businesses are on the right track and fully cognisant of their need to support their people.
“The results make it clear most organisations are prioritising wellbeing, but there’s no escaping [the fact] they are doing so in very challenging times, where the cost of living and inflationary pressures throughout the economy are almost universally New Zealanders’ key concerns,” Astwick said.
“As always, business leaders keep an eye on costs, as we should, but we mustn’t lose sight of the support our people need to enable them to be at their best.”
Cameron Smith is an Auckland-based journalist with the Herald business team. He joined the Herald in 2015 and has covered business and sport.
