Preventing sickness absences – some ideas on reform

With sickness absences going up constantly over the years, the cost for Social Security has now passed the EUR 10bn mark. The government has now decided to search for innovative solutions to help stem the upward trend in Social Security Daily Benefits (in French IJSS). Over the last 12 months there has a been a succession of reports, information leaks and proposals on reforms more or less ready for implementation. Various ideas have been mooted but one thing is clear: employers will have to pay. Whereas the first ideas coming out of the Oustric-Bérard-Seiller mission aim at getting some companies to pay, not the slightest thing has emerged in favour of companies being responsible for prevention.

Absenteeism: employers are in the government’s sights

Absenteeism: employers are in the government’s sights In the middle of last summer’s heatwave, details leaked by the economic journal Les Echos caused the temperature to rise even more in the employer federations. According to a report from IGAS, the government’s social affairs watchdog, not yet published, the intention is to make employers bear some of the costs of sickness absences. The idea was to get them to fund the whole cost of the first four days of sick leave after the statutory waiting period, for all employees who are off work for less than eight days. In practice this would mean that, just like today, employees on sick leave would receive nothing for the first three days but would then get 50% of their pay for the next 4 days but paid not by Social Security but by the employer. Sabre-rattling amongst the bosses, anxiety amongst the unions, denial from government and then a return to calm…well relative calm.

Already early in 2018 the sickness insurance fund (CNAM) had taken the initiative of divulging to employers with a particularly high sickness absence rate, the rate observed in other companies in the same industry. The aim: make them aware of the margin for improvement and, perhaps, prepare them for an adjustment of contributions based on their individual claims record, just like what already happens for work accidents.

First ideas coming out of the Oustric-Bérard-Seiller mission

This is why the Oustric-Bérard-Seiller mission was asked to come up with a few ways of bringing the cost of IJSS benefits under control. The first idea was to align the private sector with the public sector by bringing the statutory waiting period down from three days to one day. Not likely to bring much in the way of savings, though! Maybe, but this one-day waiting period could no longer be paid for by insurers, something which would be dissuasive because two thirds of employees currently have insurance cover for the waiting period.

Another idea is that IJSS benefits could become a flat payment. At the moment, daily benefits are set at 50% of gross pay up to 1.8 times the minimum wage (SMIC) i.e. benefits are capped at 0.9 times the SMIC. In the future, according to Les Echos, all employees would get the same amount i.e. 0.7 times the SMIC. Companies who employ low-wage staff would benefit the most from these changes in regulations, whilst the rest would see a rise in the amount of salary falling to their account after payment of IJSS benefits.

Savings would therefore be achieved on the back of better-paid staff, and their employers. No comment. Times they are achangin’. Obviously the simplicity of these proposals makes them attractive. Nevertheless, nothing seems to have been said about encouraging best practices or challenging companies with a high rate of sickness absences.

Firm action to combat absenteeism

The best way to bring down the cost of absenteeism is still to offer solutions to limit workplace absences. When an employer puts in place a Quality of Working Life policy at the workplace this not only combats absenteeism but, above all, creates an attractive employer “brand-image” when recruiting the best talents and when promoting employee loyalty. QWL, instead of being a constraint is a genuine opportunity for employers. You can gather more information and some robust solutions by consulting our white paper.