PM Announces Review Of Sickness Absence System

The Prime Minister David Cameron has announced an independent review which will look at changing the current sickness absence system and reducing the billions of pounds that ill health costs the economy each year. Reporting later this year, the government are hopeful that the review will:

• Explore how the current sickness absence system could be changed to help people stay in work, reduce and share costs for the taxpayer and businesses, and contribute to economic growth.
• Examine whether the balance of these costs are appropriately shared between individuals, employers and the State.
• Make tangible recommendations for change.
• Ensure that recommendations for change are consistent with promoting private sector growth and minimising burdens on business – in particular small and medium-sized businesses.

Under the current system employers bear the costs of short term sickness with the state, absorbing the cost of longer-term ill-health, with over 300,000 people leaving work to claim sickness-related benefits each year – making up around half the total flow on to Employment and Support Allowance (ESA). The review, which is jointly sponsored by the Department for Work and Pensions and the Department for Business Innovation and Skills, will include a panel of experts from business, trade unions and health representatives. It will be jointly chaired by David Frost, Director General of the British Chambers of Commerce and Dame Carol Black, National Director for Health and Work.

David Frost said, "Sickness absence undoubtedly has a huge impact on businesses – particularly on smaller firms that struggle with the processes and procedures required, not to mention the direct costs involved. The private sector must focus on growth if we are to sustain the recovery, so it is right that the Government has chosen to look at ways to reduce sickness absence in the workplace and get people back into employment. I look forward to working with Dame Carol Black to reduce the unsustainable bill on both employers and the state caused by sickness absence, and making radical recommendations to achieve this."

The findings of the review will also feed into the wider Employment Law Review, which is looking at measures to reduce red tape and remove the burdens on business, encourage growth and increase flexibility for employers and employees.