A survey of 600 payroll managers from the Australian Payroll Association reveals data about who’s taking the most sick days before and after a public holiday.
As another public holiday rolls around, so too will the increase in employee sick days – be they genuine or otherwise – which means billions of dollars in lost productivity and more paperwork for HR and payroll.
Last year’s figures placed the financial costs of sickies in Australia at around $34 billion, with millions of sick days (legitimate and fake) taken.
While it’s common for research to look into the larger impacts of sick leave on the Australian economy, new research from the Australian Payroll Association takes a more granular look at employees who take sick leave around public holidays and the kinds of businesses they work for.
Taking data from over 600 payroll managers in Australia – across eight different industries – the research reveals that 85 per cent of businesses admit employees take sick leave around public holidays, with individual payroll managers expressing a concern that Australia has a cultural issue around the misuse of sick leave entitlements.
Most common in big businesses
In the media release about the data, the Australian Payroll Association frames it as “surprising” that big businesses were more likely to have the problem.
Their data shows that 97 per cent of organisations with 1001-5000 employees had at least one per cent of their workforce taking sick leave around public holidays. This percentage steadily decreases as the size of the organisation does.
- 96 per cent of organisations with 501-1000 employees
- 93 per cent of organisations with 201-500 employees
- 86 per cent of organisations with 51-200 employees
- 76 per cent of organisations with 11-50 employees
- 52 per cent of organisations with 0-10 employees
It makes sense that larger organisations would have this problem.
There are lots of reasons why it might be easier for an employee in a big company to take time off than someone who worked for a SME. First of all, they are more likely to have access to an automated system – an employee working for a large company might not even need to speak with another human in order to log their sick leave. Often, all they need to do is punch their details into an app and then gingerly crawl back under their doona to nurse that “flu” (read: hangover).
Indeed, the size of an organisation itself is crucial. The more employees you have, the more likely at least one of them will be sick. But also, it is easier to be a small fish in a big pond when it comes to chucking a sickie. You’re more likely to be noticed when you sneak in late or not turn up to work at all when you’re working in a smaller organisation, as opposed to being one amongst hundreds.
The most fascinating data point might be that 8.33 per cent of respondents in organisations with 5001-10,000 employees said that 30 per cent of their workforce take time off before or after a public holiday. See the chart below for a full breakdown of the results.
A deeper look
The industries that the Australian Payroll Association put under the microscope were manufacturing, retail, healthcare, education, IT, finance, professional services, and building and construction.
The three industries seeing the highest level of sick leave taken around public holidays were education (94 per cent of organisations), healthcare (91 per cent of organisations) and retail/eCommerce (89 per cent).
Commenting on the different levels of sick leave taken in different industries, Australian Payroll Association CEO Tracy Angwin told HRM, “From my experience, a more unionised workforce is likely to have a general view that sick leave may be an entitlement to be taken. Some workforces have seen a lower use of sick leave when they move to having an unlimited number being able to be taken.”
While it’s easy to take a broad brush approach with employee absenteeism and assume that one industry/business size is worse than another, it’s important to factor in the personalities that make up those organisations.
In an article for news.com.au, Paul Dundon, managing director at Direct Health Solutions, identifies four different ‘types’ of people who utilise their sick leave: dominoes, under-the-radars, troopers and chronic absentees.
The latter, he says, are those employees with a chronic illness/injury who genuinely need to utilise all (and often more) of their sick leave. The troopers are those who rarely take any leave at all (to call them “troopers” is perhaps perpetuating another damaging stereotype that it’s seen as weak to take time off, but that’s a whole other article in itself).
Dominoes are those who follow in the footsteps of their colleagues, taking time off “just because” and will usually utilise their exact ten days; and he describes under-the-radars as people who strategically take sickies – often enough to benefit personally but not so much as to raise suspicions.
“8.33 per cent of respondents in organisations with 5001-10,000 employees said that 30 per cent of their workforce take time off before or after a public holiday.”
A wider cultural issue
It’s well documented that Australians are up there on the list of countries that bend the truth when it comes to sick leave, whether that be because to extend a public holiday, celebrate the outcome of a sporting match or to catch the final episode of Game of Thrones.
Australia’s 23rd Prime Minister, the late Bob Hawke, captured this lax attitude when, following Australia’s 1983 win in the America’s Cup, he said: “Any boss who sacks anyone today for not turning up is a bum.”
While most payroll managers spoken to for this survey cited seemingly genuine reasons for most employees’ sick leave (gastro/vomiting was named as one such reason), others expressed concern that sickies were becoming a larger cultural problem for Australian businesses.
One payroll manager said: “We have a cultural issue around misuse of sick leave entitlements.” Another said employees “just take the 10 days a year as an entitlement”. Another commented that their employees “are under the impression they are entitled to paid carer’s leave” when their regular childcare plans fall through.
So do we have to take a much more macro look at this cultural problem before we can address it in individual offices?
Advice for employers
Bolstering your workplace policy around sick leave in a way that doesn’t disadvantage genuinely sick employees, but discourages those partial to faking a sickie, is the best safeguard for employers.
One way to do this is to include a provision in your leave policy that requires employees to speak directly with their managers instead of sending an email or text message if they wish to take a sick day. Though it can send a damaging message about trust, Angwin also says making medical certificates mandatory for all sick leave can be effective.
(Read HRM’s previous article on when a medical certificate isn’t enough).
“Employers are increasingly looking at sick leave policies to include a requirement for doctors certificates. This may be for all sick leave, sick leave after a number of days per year (for example, you don’t need a doctors certificate for first three days taken, but you do after that) or a requirement for a doctors certificate if the sick leave falls either side of a public holiday or weekend,” says Angwin.
“It’s interesting that several payroll managers revealed they don’t see sick leave taken very often, as their organisation has a policy requiring employees to obtain a medical certificate if they take a sick day.”
Another suggestion Angwin makes is to flip the coin and focus on rewarding employees who aren’t taking advantage of the system.
“If it’s a cultural issue, there may be benefits in rewarding those who don’t take excessive sick leave. I’ve seen this as a fully paid ‘health day’ for those who didn’t take sick leave or perhaps some payment either annually or on termination for those who have not taken any or all of their full entitlement,” she says.
While this is an interesting idea, it brings up a few concerns such as encouraging workers to continue working when they genuinely are sick. The effects of presenteeism can be just as damaging as absenteeism.
“Last year’s figures placed the financial costs of sickies in Australia at around $34 billion.”
Finally, she says employers can mitigate the risk of employees taking advantage by paying out sick leave on termination or within certain parameters.
“Employers should always be monitoring sick leave trends which could include days of the week to see if there are certain triggers that show a misuse of sick leave.”
“When an organisation has one-in-three employees calling in sick, no amount of tinkering with IR legislation is going to fix the issue… that’s because changes in the law would only deal with the symptom. High rates of absenteeism are a signal there’s something very wrong with the way employees are engaged.”
So perhaps employers need to turn the question of “why are employees taking advantage of their entitlements?” back onto themselves and consider what they’re doing to engage these workers.
HRM has written extensively on various methods of employee engagement, but it’s also worth noting that employee burnout is on the rise – the World Health Organisation recently declared it to be an “occupational phenomenon that undermines how well people perform” – so if your workplace has a systemic issue with sickies, creating new rules and expectations will do little to incite change, you’ve got to think bigger picture.
Have an HR question? Access our online AHRI:ASSIST resource for HR guidelines, checklists and policy templates on different HR topics or ask you questions online. Exclusive to AHRI members.