Staff calling in sick costs firms €500m a year

WORKERS calling in sick are costing small businesses more than €500m each year, according to ISME.

Workers take an average of five days’ unofficial leave each. This means more than five million man days are lost

annually. The figures are included in ISME’s latest report, Wages and Conditions of Employment in Small Businesses. For the first time, employers were asked to list unofficial absences by workers.“Small businesses are seeing a lot of workers missing on a Monday morning. There’s certainly an element of malingering,” ISME head of research Jim Curran said. Small businesses employ 60% of the workforce, and absenteeism affects them much more than large companies. “If you have ten employees and two of them don’t turn up, that’s 20% of your productivity gone. When that’s added to the normal sick days, it causes huge problems for small companies,” said Mr Curran.

But the Irish Congress of Trade Unions said the majority of workers were committed to their jobs. “If you look at the Parental Leave Act, it entitles workers to take two days of paid leave each year when there are serious family problems. But there has only been a 2% take-up. That doesn’t suggest workers are doing everything to avoid the job,” said assistant general secretary Joan Carmichael.

ISME’s report states that wages in small businesses have increased by an average of 7.5% over the last 12 months. Manual employees now earn an average of 17,414, while office staff earn an average of 19,543.

ISME said the increasing wage costs were forcing small businesses to adopt wage freezes. “The costs of wages have to be added to 100% increases in insurance premiums and 20% increases in energy charges. A lot of small businesses need wage freezes to survive,” said Mr Curran. ISME wants the Government to tackle inflation and the high price of housing, both of which are putting pressure on wages. It is also in favour of profit-sharing schemes, traditionally only used in larger companies. Employers will agree to share 10% of profits with their workers.

“We need proper tax incentives for these schemes. Profit-sharing will give workers a greater stake in their jobs and increase productivity,” said Mr Curran. ICTU said it welcomed the profit-sharing concept, but warned it should not be used as a substitute for basic wages. Meanwhile, employment agencies have reacted strongly to a proposed EU directive covering temporary workers. Under the directive, any of Ireland’s 100,000 temporary workers who work for more than six weeks in a company will be paid the same rate as the person they replace. Currently, the rates are decided by the agencies who hire out the workers. The National Recruitment Federation said the directive would mean the end of temporary workers in Ireland.