The True Cost Of Employee Absences For Your Business

6 February, 2017 Blog, General

The True Cost Of Employee Absences For Your Business

Employee absence is an inevitable occurrence for every business. But how much are sickness and absences costing your business? We have done the math to show you how much money your business spends on employee absences each year.

The UK Average Statistics

Here are some recent average statistics related to salaries and absence rates in the UK.

  • The average wage in the UK for the tax year ending 5th April 2015 was £27,600 per annum. (source)
  • Manual workers have 2.1 more days’ absence per year on average than non-manual workers. (source)
  • The average absence rate in 2015 was 6.9 days; overall absence levels have risen slightly from an average of 6.6 days of absence per employee in 2014. (source)
  • Just over two-fifths (40.7%) of employers measure the cost of sickness absence, although many admitted this could be an underestimate. (source)

Example Cost Of Employee Absence

To show you the real numbers behind employee absence we have created an example using the average salary and absence rate. So let’s say your business has an annual turnover of £5,000,000 with a profit of £3,000,000 and employs 100 people this would give you a profit per head of £30,000. An absence rate of 8 days per person would also mean you need an extra four people just to cover absences. Also, if you require cover for people when they are absent you can double this, and when using existing staff by paying over time add another 50%. Altogether giving your business a total cost of £110,400 just to cover employee absences. The cost would be even higher for businesses who have to cover any employee absences with interim staff or use the internal staff on overtime increasing the overall cost to £276,000.

If you reduce your business absence rate from 8 days per person by just one day, you will save a total of £22,000 which is almost one person’s salary!

Reducing Employee Absence Rate

Implementing an absence management system allows your business to identify the actual cost of employee absence for your business. While providing real business benefits like increasing employee productivity, which ultimately improves your profit per head. But most importantly it promotes the wellbeing of your employees. An absence management system allows your business to monitor all employee absences and complies with the formal procedures that ensure you are adhering to your legal duty of care. It will also provide your business with the resource and visibility to reduce your overall absence rate, which will save your business thousands of pounds.


Your business will never be able to eradicate employee absence altogether. But it’s possible to actively work on reducing your absence rate with the help of an absence management system. Also, it’s important for businesses to support employee well-being.

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