To main content

A week of sick-leave costs 13,000 kroner

Industry has estimated that a week of sick-leave costs companies an average of NOK 13,000 in lost production and increased costs.

This is among the results of a questionnaire study carried out by SINTEF among a sample of companies that are members of the Confederation of Norwegian Enterprise (NHO).

Reduces loss of production
In gathering the companies’ estimates of the costs involved, the project asked more than 30 questions. Among other things, they were asked how far they could reduce loss of production due to sick-leave through greater efforts on the part of co-workers and making lost production when they returned to work.

Thirty of the 147 companies that responded had staff on short-term sick-leave at the time that they filled in the questionnaire. Many of them said that they reduced their losses by means of just these measures.

In practice, costs can be reduced
“The experience we gain from questionnaires of this sort suggests that some managers underestimate the potential for reducing loss of production. The estimated average cost is therefore probably higher than the real average. But it will always be like that when this is measured.

The nearest that we can come to the purely company-borne cost of five days sick leave is NOK 13,000,” says project manager Karl-Gerhard Hem, a social economist and researcher in the health section of SINTEF Technology and Society.

Damping can lead to new problems
At the same time, the SINTEF research emphasises that short-term damping of production loss, through greater efforts on the part of co-workers, may create new costs in the form of new cases of sick-leave – if there is no “slack” that can be taken up in the company.

“The social economic losses caused by sick-leave are quite different to those suffered by the company,” says Hem.

Hem says that the companies did not specify the percentage of their estimated losses were due to lost production or to higher costs due to hiring temps, paying overtime rates, etc.

Long-term sick-leave is reimbursed by the Norwegian Labour and Welfare Service (NAV)

If sick-leave lasts longer than 16 days, companies are reimbursed for the sick-pay that they pay out. This also needs to be factored into the companies’ total calculations and is not included in the average figures, though nor is the salary paid to staff on sick-leave.

Previous figures from 2000
SINTEF carried out a similar questionnaire study for NHO in 2000. This showed that a week’s sick-leave then cost companies an average of NOK 8500.

“This figure has been used to illustrate the economic benefits of reducing rates of sick-leave. But given that the previous study is now eleven years old, there was a great deal of interest in updating the figures,” says Hem.

The survey was financed by NHO’s work environment fund.

Photo:There has been a great deal of interest in obtaining up-to-date figures on what sick-leave costs. The figures reveal the economic benefits of reducing sick-leave rates.

by Svein Tønseth