Sickness absence costs SMEs £1,500-a-year

News Article - 08 November 2011
Category: Business

The Government has been encouraged to implement a small employer's relief for the recovery of statutory sick pay (SSP), with small and medium-sized enterprises (SMEs) hit by an average of £1,500 per year for sickness absence.

Figures from the Federation of Small Businesses' (FSB) 'Voice of Small Business' survey panel reveals SMEs only experience 2.4 days sickness absence per employee each year - much lower than the national average of 7.7 days per employee - with 81 per cent of small firms revealing they were not affected at all by long-term sickness absence.

Nevertheless, in the last 12 months sickness absence has cost firms on average £1,500, but for nine per cent it cost more than £5,000 per annum.

As a result the Government is being asked to consider greater provision to cover the cost of sickness absence for the smallest firms.

John Walker, national chairman, Federation of Small Businesses, said: "Small firms act like a tight knit family and value the contribution their staff bring to the business.

"And research shows that staff in small firms are more often committed and loyal. But sickness absence is one of the most complex pieces of employment law they have to deal with.

"It can also be costly with small businesses paying around £1,500 over the past 12 months. The Government must provide a small employers relief for statutory sick pay in the same way they do for statutory maternity pay so those small businesses that experience a member of staff on long-term sickness absence, are not hampered and are given the support they need."

Up to 40 per cent of SMEs claimed that dealing with holiday entitlement and sickness absence was one of the most difficult aspects of employment law. Consequently an automated HR software solution may prove useful to small business employers to support every aspect of the employee lifecycle, streamlining communication and analysis of information across entire organisations.

Article keywords: sickness, absence, cost of absence, hr software

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