· 1 min read · News

Lack of financial protection for staff can have an impact on an employer's bottom line

Published:

Less than a quarter of companies protect themselves and their workers with income cover for the long-term sick and this can have an impact on an employer's bottom line, new research suggests.

According to a report from Unum, 62% of UK companies claim to have been financially impacted by long-term sickness absence in the past five years, more than a half of UK businesses continue to pay full salaries for six months or more while employees are absent due to illness or injury and less than a quarter (22%) of companies protect their employees and their business by offering income protection cover.


The report reveals two million workers currently in employment have had to take six months or more off work.

More than half (55%) of UK companies say they continue to pay employees’ full salaries for six months or more if they are off work due to illness or injury.

Many of these employers are shouldering the burden, with only 22% protecting their own business and all or some of their employees by offering any form of financial protection, such as income protection or critical illness, as part of their employee benefits package.

Companies, both large and small, are affected by long-term sickness absence, with 69% of companies with more than 500 employees saying they had seen a financial impact on their business as well as 40% of companies with fewer than 500 employees.

Long-term sickness absence is also a reality for UK workers, as one-third (31%) of employees claim that they have had to take one month or more off work as a result of illness or injury; and over two million say that they have had to take off half a year or more due to illness or injury.

Marco Forato, Unum's chief marketing officer, said: "Employee long-term absence, as a result of illness or injury, is a real financial burden for UK businesses.  In the current challenging business environment this issue is only likely to place greater strain on employers and unfortunately our research shows that as companies are not taking steps to protect themselves or their employees, it will continue to be a financial drain on businesses for some time to come."