On any given day, you may look around your office and see that all your employees are at work. But present doesn’t always mean productive. Presenteeism—absenteeism’s lesser known, but still costly, cousin—occurs when employees who are physically present are, due to a physical or emotional issue, distracted to the point of reduced productivity.
As employers increase their sensitivity to the issues surrounding mental and physical health in the workplace, they also increase their awareness of presenteeism. “Everyone is aware of situations where employees are at work but are not productive due to emotional or physical distractions,” says Greg Van Slyke, senior director, business development, with Homewood Human Solutions. “They may call these individuals the ‘walking wounded’ or, to use a sports analogy, say they are ‘playing hurt.’”
But beyond this simple definition, presenteeism has several nuances. If, once or twice, an individual is distracted at work by a personal matter, that is not presenteeism or, at least, it is notconsistent presenteeism. According to Emmanuelle Gaudette, prevention and health promotion manager with Standard Life, “If the problem that creates the distraction persists and results in chronic stress with unhealthy physical or emotional manifestations (racing heart, headaches, depression), it becomes a health issue that interferes with productivity.” That’s the presenteeism employers should be concerned about.
Lost productivity costs
Increasingly, plan sponsors and their consultants understand that a well-designed wellness campaign should help improve workplace health and employee productivity. And it is generally understood that the more a wellness strategy is ingrained across all levels of an organization—from procedural to social—the more positive its influence on employee health. To measure the impact of such a strategy, plan sponsors typically track criteria such as degrees of absenteeism, increases/decreases in drug claiming for chronic conditions with a lifestyle connection, short- and long-term disability claims and return-to-work successes and failures.
But absent from this list, due to its difficulty in quantifying, is measurement of presenteeism. To properly measure, presenteeism requires initial benchmarking followed by a form of intervention to address its causes. A follow-up remeasurement, post-intervention, then quantifies the degree of presenteeism. It sounds straightforward, but it’s not when you consider the depth to which employee actions, reactions, expectations regarding output and individual physical and emotional influences need to be identified and measured—all while using statistical protocols.
The labour-intensive components of this activity—and its need for a command of sophisticated measuring and statistical criteria—preclude many from doing so. Nonetheless, many sponsors continue to want, and need, to know what they can anticipate as their return on investment (ROI) before investing time in planning and delivering a possible solution.
Numbers game
Unfortunately, despite the existence of various North American studies on the matter (some dating back to the mid-’70s), quantifying presenteeism in terms that relate to businesses across the board has been difficult because of issues around consistency and integrity of the studies. Fortunately, clarity is on its way in the not-too-distant future. Soon, Canadians will be able to look to a number of Canadian research projects on absenteeism, disability and presenteeism in relation to wellness investment that will provide metrics rooted in scientific, objective and reputable research mechanisms. These projects, currently under way, are the result of a partnership of insurance companies, educational institutions and others with a vested interest in quantifying the human and ROI value of wellness programs.
In one such effort, Standard Life has partnered with the University of Montreal in the study called Developing Better Assessment, Interventions and Policies in Occupational Mental Health: A Multi-disciplinary Approach. The objective of this five-year project is to analyze the link between personal and organizational characteristics; namely, to better understand the influence of a company’s management practices on employee mental health. Early results will be released this fall, with the remainder throughout 2013.
Standard Life’s objective is to help educate employers to help them visualize the human and financial cost of mental health issues in the workplace. “We want to put numbers around this issue to help our plan sponsors better understand the negative implications (including presenteeism) of having unhealthy or distracted employees—whether or not they are at work—as well as the value of investing in wellness,” says Gaudette.
Getting to ROI
In an effort to generate quality, scientifically sound data on the ROI of wellness, the Sun Life Wellness Institute partnered with the Richard Ivey School of Business for the Return-on-Investment (ROI) Study of Workplace Wellness Programs, intended to increase evidence and insight into Canadian workplace wellness. Phase 1, completed earlier this year, consists of a comprehensive review of all published literature on the issue of workplace wellness programs and their outcomes. Phase 2, under way now, is a two-year field study involving a number of Canadian organizations and examines wellness strategies in relation to ROI.
Dr. Michael Rouse, director of the Health Sector MBA with the Ivey School of Business and head of the joint study, recently shared results of the completed Phase 1 with industry members and says the study’s rigorous review of global literature and studies on the ROI of wellness programs “reveal a savings of 1.5 to 1.7 absentee days per employee, per year when a wellness program is in place. This translates into a savings of $251 to $274 per year, per employee.”
Bear in mind, the above statistic is only what has been revealed by research literature to date and includes data from outside Canada. Phase 2 of the study is restricted to Canada.
The Burnout factor
Further insight into the effects of presenteeism, its hidden costs and impacts within the workplace can be found in Sun Life’s recently published report The Burnout Factor. The following details from the report highlight the high toll of poor physical and mental health on workers and, by extension, their employers.
- The group with the highest average “burnout factor” (stresses in emotional, financial, personal, professional and health areas) is that of full-time employees. They received a score of 38, which is high in relation to retired individuals (with a score of 20) and in comparison to all Canadians (with a score of 31).
- Of the full-time employee group, it is the individuals between the ages of 35 and 44—prime productive working years—who are at a particularly high risk of stress. Their burnout factor score was, on average, 40.4, which is 30% higher than that of the average Canadian.
Why the focus on chronic stress? Because medical research indicates prolonged exposure to stress has strong links to chronic health conditions such as high blood pressure, hardening of the arteries, obesity and more. While other research on this matter is taking place in North America, these two studies are uniquely Canadian and, therefore, are expected to be influential in helping Canadian plan sponsors better understand and quantify expectations around investing in wellness.
Outside of any research taking place, the reality is that employers will always need to be sensitive to the human and financial costs of presenteeism, absenteeism and disability in the workplace and will always wish to mitigate those costs. If plan sponsors currently believe in the strong correlation between improved ROI and the time, effort and initiative involved in creating and sustaining a proactive organizational culture that is committed to mental and physical health, then following this data will be key to developing wellness programs in the future.
Esther Huberman is a communications consultant with Pal Benefits. ehuberman@palbenefits.com