The Government has published the results of an independent review of the sickness absence system. The review recommends the introduction of an Independent Assessment Service (IAS) to assess individuals’ physical and/or mental state when they have been signed off work for four weeks. The IAS would also provide advice about how an individual on sickness absence could be supported to return to work.
The review argues that the current sickness absence system is failing, pushing people away from the labour market into inactivity and adding significant costs to business. To help combat the 140 million days lost to sickness absence every year, the review makes the following suggestions:
• ‘Fit note’ guidance to be revised to ensure that judgements about fitness to work move away from only job-specific assessments. Currently employers cannot make adjustments where an illness is compatible with a return to work as the majority of fit notes sign people off as completely unfit.
• Tax relief for employer expenditure designed to keep sick employees in work, or speed their return to work through medical treatments or vocational rehabilitation.
• Abolition of the Percentage Threshold Scheme, which compensates employers for very high rates of sickness absence costs and costs £50 million a year. It also gives employers no incentive to manage absence.
• Abolition of Statutory Sick Pay record-keeping obligations. This would reduce administrative burdens on employers and save them £44 million.
• Update the ‘Employers’ Charter’ to address misconceptions and legal uncertainty around sickness absence management and
• Carry out further research into why a significant number of people claiming ill health benefits who come straight from work appear not to have been paid sick pay by their prior employer.
The review states that implementing its recommendations could save £400 million a year for employers, up to £300 million a year for the State and boost economic output by up to £1.4 billion. With such numbers being bandied around, this should spell good news for employers if this goes ahead.
The Government will respond to the review in due course.
The Devonshires employment blog will keep you updated.