UK businesses have been spending £620,000 every year on long-term employee sick leave, the Centre for Economics and Business Research (CEBR) has found.
Research, on behalf of income protection specialist Unum, showed the costs of illness or injury sick leave taken by employees for longer than 6 months.
The costs of long-term absence include; occupational sick pay; recruitment, training and salaries of replacement staff; loss in productivity; and the compliance and red tape associated with absence management.
Peter O'Donnell, chief financial officer at Unum UK, said: "When selecting employee benefits, employers look at the benefits that employees value most, and which they will use as well as those that will offer the greatest benefit to staff.
"Most employers will go above and beyond their statutory requirements and offer OSP to staff on long-term sick leave, but most do not insure against this unexpected cost so it has a significant impact on their bottom line."
CEBR said group income protection would free up HR teams to focus on other areas of the business.
Income Protection will provide regular monthly income of up to 80% of pre-illness income generally paying out after 6 months off work, and continuing until a return to work.
Leading by example
Only 6% currently receiving it
Why it is more than just a 'nice to have'
'Ring fence your past, ring fence your present, ring fence your future'
COVER and L&G explore why income protection is so important