Absenteeism is hitting UK SMEs where it hurts

Absenteeism is having a big impact on profitability say UK small and medium enterprises (SMEs). This is according to 71% of firms questioned in a survey commissioned by HR and payroll specialist Moorepay.

The research found that many UK SMEs are experiencing higher than average absenteeism in their business. According to the Office for National Statistics, the average number of sick days for a UK employee is 4.3 days a year and yet almost half (49%) of small business owners said staff take more than five days off each year. For 14% this figure rises to seven days or more.

Yet with higher than average sick days and the impact on profitability, few firms are taking positive action to reduce absenteeism in their business. This is despite the fact that many feel introducing policies around absences, flexible working, time off for family or medical reasons and return to work programmes can have a positive impact on reducing absenteeism. Almost three-quarters (72%) believe the use of such policies could reduce the rate by 11% or more.

Whilst the vast majority of firms (91%) do track staff absences this is often paper or spreadsheet-based leaving it open to human error – 39% log absenteeism in this way. Many have little insight into the true picture of absenteeism by failing to track the multiple reasons for time off work. Whilst days off sick and annual leave are commonly monitored by 75% and 66% of SMEs respectively, other reasons for absence are less well tracked. Training, compassionate leave, medical appointments, sabbaticals and duvet days are only reviewed by 55%, 51%, 50%, 28% and 22% of businesses respectively.

Despite the business impact of absenteeism, many SMEs have no policies or processes in place to manage or reduce absenteeism in their business even though they recognise this can have an impact on the rate of absence. For example, almost half of businesses don’t offer flexibility around time off for medical appointments (46%) and family issues (53%).

“According to NICE, the National Institute for Healthcare Excellence, it is estimated that absenteeism costs the UK economy £15 billion a year. And yet, many SMEs have inaccurate or incomplete data on staff absences and are unable to accurately assess how much it is costing their business,” explained Lisa Gillespie, director of HR services at Moorepay. “Those that recognise the business and financial implications are often spurred on to take action. Having insights into absenteeism and taking positive steps to reduce it can have a huge impact on business productivity and therefore profitability – something no business can afford to ignore.”

Notes to editors:
Survey methodology
400 business owners and senior decision makers in small and medium-sized UK-based businesses with between 9-400 employees were surveyed by 3Gem Research and Insights between 29th June to 4th July 2017. The survey was commissioned by HR and Payroll services provider, Moorepay.

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Founded in 1966, Moorepay is the trusted market leader in payroll & HR solutions for UK businesses. Supporting a customer base of over 10,000 clients, Moorepay process an average of 3,500,000 payslips every year and manage approximately 150,000 queries from clients requiring professional HR and Employment Law advice. Moorepay’s innovative cloud-based solutions include software, consultancy, training and managed services which are quick to set up, with no need to installations, downloads or upgrades.

Moorepay is a division of NGA Human Resources, a recognised global leader in Payroll and HR, employing over 8,500 staff members across 35 countries and five continents.