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Sickness absence costly for small businesses

The Federation of Small Businesses (FSB) has called for the Government to introduce a small employer's relief for the recovery of statutory sick pay (SSP), as new figures show that sickness absence costs small businesses on average £1,500 per year.

 

Long term sickness absence does not affect the smallest of businesses frequently, but when it does it has a big impact and the costs can be high. The FSB's ‘Voice of Small Business' survey panel shows that on average small businesses only experience 2.4 days sickness absence per employee each year – much lower than the national average 7.7 days per employee – 25% said that they experienced no sickness absence at all and 81% said that they were not at all affected by long-term sickness absence.

 

In the last 12 months sickness absence cost firms on average £1,500, but for 9% it cost more than £5,000. So it is important that the Government does more to help with the costs of sickness absence in the smallest firms.

 

With 40% of small business employers claiming that dealing with holiday entitlement and sickness absence was one of the most difficult aspects of employment law, the FSB believes that recovery needs to be simplified so micro firms can reclaim all SSP costs more easily to stop them from being hampered at such a difficult time.

 

The FSB is calling on the Government to introduce a small employer's relief for all firms with an annual National Insurance Contributions bill of less than £45,000 to recover SSP. This relief would be like that used for reclaiming statutory maternity pay and would use the same calculations. As a result, it would ease the administrative burden, as well as helping businesses manage sickness absence better.

 

 

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