Poor mental health is costing UK employers more

A new report highlights the cost of mental health problems at work.

working mum sits at desk, stressed


Poor mental health costs UK employers up to £45 billion each year – an increase of 16% since the last estimate of £37bn in 2016, according to a new report.

The report from Deloitte and Mind shows little improvement since a similar report in 2018 with regard to how open and willing to address mental health problems employers are. Nine per cent of employees who disclosed a mental health problem were dismissed, demoted or disciplined, while only 44% would feel comfortable talking to a line manager about their mental health, according to a new report.

The top three reasons for not approaching occupational health for support over mental health issues were not thinking they would provide support, not wanting to make their problem formally known and concerns about confidentiality.

The report points out that SMEs in particular need more support in addressing mental health issues at work.

It cites projections that mental health problems will soon surpass other work-related illnesses such as musculoskeletal disorders, respiratory diseases, cancer, skin issues and hearing damage as well as a Chartered Institute of Personnel and Development report which indicates a significant increase in the number of reported instances of mental ill health over the past year, with mental health is deteriorating more in larger organisations. About seven in 10 employers said they had experienced an increase over the past year in reported mental health conditions. The top reasons for this for employees are workload and pressure to meet targets.

Moreover, the report estimates that the costs to employers of mental health‑related presenteeism are roughly three‑and‑a‑half times the cost of mental health‑related absence. It adds that the costs of presenteeism have increased at a faster rate than the costs of absence, partly due to changes in the working environment that
encourage employees with poor mental health to present themselves at work rather than take illness absence. These include perceived job insecurity, connectivity and increased workload.

Always on

Leaveism – the growing tendency of individuals to be unable to ‘switch off’ from work – is also a growing problem in an ‘always on’ culture. That not only causes mental health problems, but the report shows some people, particularly young people, are using their leave to do work rather than admit that they are struggling with mental health issues. The report estimates that one person in 12 may resort to leaveism rather than openly disclosing their mental health problem to their employer. Other issues raised by the report include precarious jobs and the impact of financial debt on workers, particularly younger workers.

The report makes a strong business case for companies to address mental health issues, saying that, on average, for every £1 spent on supporting their people’s mental health, employers get £5 back on their investment in reduced presenteeism, absenteeism and staff turnover.

It calls on employers to take stock, monitor and analyse performance at the organisation; tackle stigma and improve awareness of mental health issues and commit to taking action; provide more support through training; understand the drivers of presenteeism and leaveism in the organisation and take action to reduce them; ensure support is appropriate for and accessible to young people; and consider whether increasing financial literacy and providing financial support is appropriate for the organisation.

Tackling presenteeism

Paul Farmer, Chief Executive of Mind, said: “Smart, forward-thinking employers are investing in staff wellbeing, and those who do tend to save money in the long run. This report shows the link between prioritising staff wellbeing and improved loyalty and productivity; and decreased sickness absence and resignations.

“However, it also shows a rise in ‘presenteeism’ – unwell staff spending unproductive hours at work rather than taking time off. As presenteeism costs three times more than sick leave, we need to look at supporting employers to change the culture so their staff feel able to take time off when they are unwell.

“The Government must also play their part by improving the definition of disability under the Equality Act, so more people with mental health problems can benefit from its rights and protections, as well as increasing the amount of Statutory Sick Pay (SSP) staff receive when they’re off sick. Employers can access resources to help prevent poor mental health and promote wellbeing through the Mental Health at Work Commitment.”

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