The manufacturers’ body Make UK is urging chancellor Jeremy Hunt to provide tax breaks on a range of occupational health services in this week’s Budget.
The call has been prompted by research that has suggested UK manufacturers have substantially increased their investment in the wellbeing of their staff over the last 12 months in a bid to tackle sickness absence and retain their skilled workforce.
Reforming tax incentives to encourage employers to invest more in occupational health provision is something currently being actively looked at by the government as a way to tackle long-term sickness absence and keep more people in work for longer.
The overall sickness absence picture is positive, Make UK has argued, with the average days lost to absence falling to 4.7 in 2023 compared with 5.6 in 2022. The main cause of long-term absence is physical health (81.1%) while long-term mental health is the cause of a third (33.6%) of absence.
Despite the overall fall, companies are still seeking ways to reduce absence and retain staff, with more than four in 10 companies (45%) increasing their investment in workforce health and wellbeing in the last year. Nearly half (49%) had maintained their level of wellbeing investment.
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Further, the amount companies are investing per person has also increased, with a third of companies (33%) investing more than £100 per employee, Make UK said.
As a result of this investment, more than four in 10 companies (40.6%) have seen increased staff retention while almost a quarter (24.6%) have seen reduced days lost to absence. Almost a fifth (18.6%) have seen increased productivity.
Companies saw the best return from direct welfare initiatives. Employee assistance programmes were the most popular measure offered by companies (42.1%) followed by counselling services and other therapies (38.2%).
Free eye tests and health screening were also offered to employees by 35% and 30.9% of companies respectively. Private medical insurance was also offered by almost a third of companies (30.9%), said Make UK.
Other measures provided by companies to improve workforce satisfaction and reduce absence were free flu vaccinations, advice on healthy eating and lifestyles, alongside gym subsidies.
Jamie Cater, senior employment policy manager at Make UK, said: “Employers are seeing the benefits in particular of increased investment in employee health and wellbeing, and the government has an opportunity at the Budget this week to support businesses to do more of this by expanding tax relief on a range of occupational health services to help people stay healthy and productive at work.”
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