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"Sickies": the costs, the causes, and strategies for reducing them

"Sickies" — sick days taken by the well, also known as absenteeism — costs billions Australia wide each year. And sickies are on the rise. But good management can help reduce absenteeism in your organisation. Here are some strategies to help. Alison Knight, CrossroadsHR

The cost of "sickies"

Australian businesses lost $30 billion due to record absenteeism levels in 2010. Absenteeism rose by 5% in 2010 to reach a peak average of 9.87 days per employee per annum, with the banking, finance, telco and public service industries the hardest hit, a DHS 2010 survey reveals. It is estimated that the cost of sickies is 22 times more than the cost of strike action. And employers believe at least half of all sick leave days are not taken for genuine reasons.

With averages up from 9.3 days per year 12 months ago, 36% of organisations quoted increased levels of absenteeism. The UK's average is seven days and the US's is six. Highest absenteeism is among call centre workers, union members, Gen Y members and employees with children or other dependants. IT industry workers have the lowest levels. The consequences of casual and genuine sickies include $30 billion in lost productivity for the economy a year. There are impacts on the staff who "fill the gaps" in terms of overwork and burn out and more absenteeism.

As a result, it has been suggested that businesses are not doing enough to manage their sick leave.

The causes of "Sickies"

Key reasons suggested for the rise in sick leave taken include:

  • The global financial crisis, which caused morale to drop and stress to rise, and caused management to shift focus away from employees and on to the organisation at large.
  • Anxious post-GFC employees staying in roles they don't like, rather than risk changing jobs — so they are suffering higher-than-usual levels of stress.
  • The outbreak of swine flu.
  • A big increase in mental health issues, particularly in the younger demographic.
  • Obesity and unhealthy eating means people are more likely to get sick.

However, absences from the office are often about a lot more than illness. All of the following issues can lead to increased absenteeism from employees who find their work environment stressful:

  • Poor supervision and management styles.
  • Unrealistic workloads and deadlines.
  • Feelings of unfairness in how staff are treated.
  • Lack of job security and low morale in the workplace.
  • A "culture" of sick leave, in which staff imitate the existing behaviour in the business unit and "take their quota" of sick days.

Strategies for reducing "sickies"

Organisations are still battling to tackle unplanned absence effectively. The solution to absenteeism begins with leadership and management. To reduce absenteeism, leaders need to:

  • Focus on creating a positive workplace in which they take the time to listen to employees, to treat them fairly and with respect and to provide realistic timeframes and the necessary support to complete their workload.
  • Be in tune with their employees' needs and be aware of any evidence of employee stress in the workplace.
  • Keep abreast of market salaries and remunerate competitively.
  • Recognise and reward employee contributions.
  • Increase employee involvement in decision-making processes.
  • Support work life balance principles in the work place.

Perceived unfairness in the workplace is under the control of individual managers. If there are good relationships and clear expectations and staff feel that managers care about them, then staff won't want the organisation to suffer.

Other strategies are available to reduce absenteeism and can have significant cost savings. The key is tighter controls on sick leave including:

  • Monitoring absences more closely.
  • Requiring staff to ring their manager and give clear reasons for the absence.
  • Ongoing contact from managers during the employee's absence.
  • Contact from health workers, following up sick staff with treatment advice.
  • Medical certificate requirements.

All this becomes easier if you have the right sort of HR Manual in place.

More information from Crossroads HR

Contact Kim Murrells at Crossroads HR on (03) 9862 5900 if you would like to talk further about managing absenteeism or other HR issues.

More information from Cleardocs

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Lawyer in Profile

Julia Tonkin
Julia Tonkin
+61 3 9258 3318

Qualifications: BA, LLB, University of Melbourne

Julia is a Partner in Maddocks Corporate and Private Clients team. Julia has extensive expertise in:

  • estate planning, structuring for succession of ownership and control of private and family businesses.
  • charities and not-for-profit space.

Julia’s clients include high net worth individuals and families and privately held businesses.

Clients value Julia’s empathic, common sense yet technically sound approach to complex legal (and often interpersonal) issues.

She has been recognised as an Accredited Specialist by The Law Institute of Victoria with an accreditation in Wills & Estates Law. She has also been recognised in Doyles Guide for Wills, Estates & Succession Planning Law Recommended – Victoria in 2023.

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