Outsourcing long-term sickness leads to ‘forgotten’ employees

Farming out long-term sickness absence management and payments to a permanent health insurance (PHI) provider can lead to ill employees simply being forgotten about, according to a new study.

The guide, Recovery, Rehabilitation and Retention: maintaining a productive workforce, by the Chartered Institute of Personnel and Development, is due to be published during January.

The guide is intended to help HR professionals better manage employees suffering from stress and other mental health problems.
PHI schemes will normally pay up to 75 per cent of salary until the employee is able to return to work, retires or dies.

“Although there are some advantages to this approach, there is a tendency for organisations to forget about employees once they are on these schemes, with the result that few employees ever return to work,” said report author, Noreen Tehrani.

The importance of effective case management could not therefore be over-emphasised, she added.

Some countries commonly had dedicated case managers or rehabilitation co-ordinators in workplaces, and reported much lower levels of long-term sickness and disability than in the UK.

“It’s not always possible in small organisations to have a dedicated person with the time and skills to undertake this work, but it is important to make sure someone is responsible for the case management process,” said Tehrani.

Other key points in the guide include:

  • The need to gather and evaluate evidence
  • Being prepared to invest in effective support mechanisms
  • The importance of assessment and how employee well-being assessments can help
  • The need to find out early in the process whether the workplace has been a factor in making someone ill
  • How to address the issue of performance deficits in a constructive, objective way.


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