As an HRTech expert with decades of experience guiding organizations through technological and cultural shifts, Ling-yi Tsai possesses a unique perspective on the intersection of data, wellness, and productivity. Her work in HR analytics has given her a front-row seat to how companies leverage, or fail to leverage, critical information about their workforce. We sat down with her to explore the surprising recent trend of employers abandoning sickness absence tracking. Our conversation delves into the risks of flying blind without this data, the practical steps for measuring both direct and indirect costs, the tangible return on investment from proactive benefits, and the pervasive, often-invisible challenge of presenteeism.
We’ve seen a shift where nearly a third of employers now don’t measure sickness absence, a notable increase from last year. What cultural or economic factors could be driving this decline in tracking, and what are the immediate risks for a company that stops monitoring these metrics?
It’s a genuinely concerning trend, especially seeing that number climb to 32% after we hit a six-year high in measurement just last year. I suspect a few things are at play. Economically, some companies might be cutting back on non-essential software or administrative resources, and they mistakenly view absence tracking as a low priority. Culturally, there’s a well-intentioned but sometimes misguided push for “high-trust” environments where tracking can feel like micromanagement. The immediate risk, however, is flying blind. Without this data, you have no real understanding of burnout hotspots, recurring health issues, or management problems. You’re essentially waiting for a small fire to become an inferno before you even realize you need a fire extinguisher.
The report notes that tracking lost hours is the most common measurement method, used by 48% of employers. For a business new to this, how would you advise them to start tracking this effectively, and what’s a key next step to mature from that into measuring indirect costs?
Starting with lost hours is a fantastic first step because it’s tangible and relatively easy to implement. For a small business, this can be as simple as a shared spreadsheet, but I’d strongly recommend integrating it into their payroll or HR information system to automate the process and ensure accuracy. The key is consistency. Once you have a reliable baseline of lost time, the next crucial step is to look at the ripple effects—the indirect costs. This means talking to your managers. Ask them, “How many hours did your team spend covering for an absent colleague? How much time did you spend reorganizing workflows?” These conversations start to quantify the 39% of indirect costs the report mentions, like management time and the strain on other employees, which are often far more expensive than the absent employee’s salary alone.
Katharine Moxham emphasized measuring the return on investment for support programs. Can you provide a step-by-step example of how a company could use group income protection benefits for early intervention and then calculate the financial benefit against the costs of long-term absence and lost productivity?
Absolutely, this is where benefits stop being a line-item expense and become a strategic investment. Imagine you have an employee, let’s call her Sarah, who is showing signs of burnout and has had several short-term absences. Through your group income protection plan, you offer early intervention—perhaps connecting her with mental health support or a financial advisor to address a life challenge causing her stress. Because she gets this support immediately, she avoids going on long-term leave. To calculate the ROI, you first look at the cost: the benefit premium and the cost of the intervention. Then, you calculate the savings. You’ve avoided months of statutory sick pay, which 40% of companies track. You’ve avoided the 34% of direct costs associated with hiring a temp. And most importantly, you’ve avoided the massive productivity loss from a key team member being gone for an extended period. The math almost always shows that proactive support is a fraction of the cost of long-term absence.
With just 45% of employers measuring lost productivity, the hidden costs of presenteeism seem largely ignored. How can an organization begin to quantify the impact of employees who are physically present but mentally checked out, and what are some proactive, supportive measures that address its root causes?
Presenteeism is the silent productivity killer, and it’s notoriously difficult to measure, which is why so few do it. You can’t just count empty chairs. To start quantifying it, you need to look at proxy metrics. Are project deadlines being missed more frequently? Have customer service scores dipped? Is there an increase in errors or safety incidents in a particular department? These are often symptoms of a disengaged, unwell workforce. The most effective proactive measures are those that address the root causes head-on. This goes back to robust employee benefits that support the whole person—not just physical health, but mental, financial, and social well-being. By providing accessible tools for stress management, financial counseling, or family support, you’re not just helping someone who is already sick; you’re creating an environment where they are less likely to become sick or disengaged in the first place.