Workplace absence has increased for the first time in five years, adding an extra ten million days to a problem that cost business £11.6bn last year alone.
A survey of over 500 firms by the CBI and AXA, published today (Monday), shows that over three-quarters of companies suspect employees of taking "unwarranted" long-weekends by calling-in sick on Fridays or Mondays.
Seventy-eight per cent of firms said there was either a definite or possible link between patterns of absence and the unauthorised extension of the weekend.
The annual survey also reveals that employers fear 25 million days were lost last year through staff taking non-genuine sickness absence or "pulling sickies". That accounts for 15 per cent of all absence at a cost of £1.75bn.
The total number of working days lost to absence has increased for the first time since 1998, caused by an eight per cent rise in service sector absence. Total days lost rose from 166 million in 2002 to 176 million in 2003. That is 7.2 days per employee, an increase of six per cent or almost half a day.
The cost of overall workplace absence remains worryingly high, with firms paying £11.6bn in 2003 to cover the salaries of absent individuals and the resulting overtime and temporary cover. This translates to £475 per employee and matches the overall figure in last year's survey.
John Cridland, CBI Deputy Director-General, said: "Firms understand that the majority of absence is due to genuine minor sickness. But absence is a serious and expensive concern that is on the increase.
"This rise has been caused by a growing level of service sector absence that may be the direct result of the tough year endured by the sector. As costs rose in 2003, many services firms were forced to slim down and conduct the same amount of work with fewer staff. This would have increased pressure on employees and possibly affected morale, leading to an increase in absence.
"Unwarranted long weekends and staff 'pulling sickies' are taking their toll on the UK's ability to absorb the enormous cost of absence. With employees 'pulling sickies' adding £1.75bn to last year's absence bill, companies will be concerned about staff awarding themselves days off during this Summer's Euro 2004 football tournament."
The gap between public and private sector absence is worryingly large, with public sector staff taking an average of two extra sick days than their private sector counterparts. Public sector absence averaged 8.9 days a year and cost £566 per employee, significantly higher than private sector absence which averaged 6.9 days and cost £450 per employee.
The CBI points to figures showing that the public sector accounts for 29 per cent of total UK employment but public sector absence accounted for 36 per cent of total absence. That is 64 million days of the total 176 million days lost to absence.
The CBI says that the UK taxpayer would be saved £1bn if public sector absence was brought in line with the private sector average. Overall public sector absence cost a total of £4bn last year.
Firms said that long-term absence accounted for just five per cent of all absence cases but was responsible for a third of total time lost through absence.
The survey also shows manufacturing firms reported higher absence levels than service sector companies - 7.4 days lost compared with 6.4 days lost. Service sector absence increased by eight per cent - or half a day - in this survey, rising from 5.9 days in last year's survey.
Absence varied greatly across the UK but this survey has consistently shown no lasting link between absence and region. Absence was highest in the North West (10.1 days), followed by the east and north of England (both 8.1 days) and Northern Ireland (8 days). Average absence levels were recorded in Wales (7.8 days), the east midlands (7.3), southern England (7), southwest and southeast England (both 6.9) and the west midlands (6.6). The lowest absence levels were recorded in Yorkshire & Humberside (6.3), Greater London (6) and Scotland (5.6).
Manual workers have significantly higher absence rates than non-manual employees. Manual worker rates averaged 8.7 days per employee in 2003, compared with 5.9 days per employee for non-manual staff.
Larger organisations reported higher absence levels than smaller ones. Firms employing over 5000 averaged 10.2 days per employee, while companies with less than 50 staff averaged 4.2 days. The CBI believes smaller firms have lower absence rates because of more frequent senior management contact and greater peer pressure.
Dudley Lusted, AXA Head of Corporate Healthcare Development, said: "Absence is a two-headed monster. Short-term absence responds well to good people management as the causes often have a lot to with employees' attitudes towards work. But an altogether different approach is required for managing long-term absence, which, whilst small in number, accounts for a third of working time lost. That more companies are introducing rehabilitation policies is welcome recognition that doing nothing is not a viable option. Early intervention and active management are key to success, as evidenced by the finding that companies that provided long-term sick employees with access to medical care or treatments had lower absence levels."
The report will be formally launched tomorrow (Tuesday) at a major CBI-AXA conference, to be addressed by Minister for Work Jane Kennedy.
This annual absence and labour turnover survey has been conducted since 1987. This year's survey was conducted in January and March 2004. Respondents were asked to report on absence and labour turnover for 2003. Replies were received from 530 organisations; 501 responded to the full survey and 29 to a shortened follow-up survey. Organisations responding employ over 800,000 employees, approximately three per cent of the UK workforce.
The report 'Room For Improvement' will be launched on 25 May at a CBI conference sponsored by AXA and will be addressed by Minister for Work Jane Kennedy and Chair of the Health and Safety Commission Bill Callaghan. Further details of the conference are available on 020 7828 0999.
The full report is available to journalists from the CBI press office. Others can order it from www.cbi.org.uk/bookshop