Could you lose thousands from your wages due to sickness?

A new report unveiled by LV= reveals that the average Briton spends almost a year (360 days) off sick. With on average 252 days in a working year, this equates to almost a year and a half of their working life.

Current health of the UK workforce

The first National Sickness Report from LV= looks at the current health of the UK workforce[1], gauges their attitude towards sickness, and looks at how they guard against the impact of long-term absence.

Long-term illnesses affecting working Britons

According to the figures, 131 million days are lost per year due to sickness absences, equivalent to six per worker in the UK, and over 13 million of these were lost due to stress and depression[2]. The research, conducted among full-time workers, reveals that stress and depression are two of the most common long-term illnesses affecting working Britons today. Workers who have suffered from stress or depression during their working lives say they took an average of two and a half months (81 days) off to recover.

The report reveals that more than a third (36%) of workers do not receive sick pay cover from their employer. This means that more than 7.8 million workers would only qualify for Statutory Sick Pay of £86.70 per week if they fell ill.

Average amount of time off to recover

Assuming the average UK wage is £26,664[3], an employee suffering from stress and depression who only receives Statutory Sick Pay could lose up to £4,671[4] – that’s a sixth of their salary (18%) – if they took the average amount of time off to recover.

Whilst the average amount of time someone has off with stress is 81 days, over 650,000 (2.9%) UK workers have been off with stress for more than a year during their career. Indeed, in the last three years 1 in 50 (435,800) workers have been off sick for more than a year. Of those workers who have been off sick, more than half (57%) underestimated how long they would take to recover when they fell ill.

It’s not just stress that could leave working Britons feeling the financial pinch, however. Other serious ailments, such as a bad back, could cost a worker in excess of £3,000 in lost wages.

Bridging the gap– the back-up plan

When asked about their company’s sick pay policy, more than half (52%) of workers admitted to being in the dark as to what they would be entitled to and a quarter (26%) admitted they didn’t know how they would manage to make ends meet if they were sick and without their regular income. Over a third (35%) of respondents said that they would dip into their savings to bridge an income gap. However, a quarter (23%) said their savings would run dry after just two months, and only one in ten said they have enough put by to support themselves for more than a year.

None of us are invincible

Whilst no one wants to think about getting ill, unfortunately none of us are invincible and the reality is that some people will need to be off work for a large chunk of time. When we buy a car, a washing machine or even a phone, we resign ourselves to the fact that at some point it might break down; however, far too few of us have a back-up plan in place that would protect our income if we found ourselves unable to work.

Source:
1. According to the Office for National Statistics ‘Labour Market Statistics’ (September 2013), there are 21,790,000 Britons in full-time employment
2. According to the Office for National Statistics Sickness Absence in the Labour Market 2012
3. According to the Office for National Statistics
4. According to the research conducted by OnePoll on behalf of LV= in September 2013, on average a worker ill with stress/depression will not return to work for an average of 81 days. Based on the fact that Statutory Sick Pay (SSP) of £86.70 per week is payable from the 4th consecutive day of absence average and would therefore be paid for 77 days or 11 weeks an employee would receive £953.70 whilst they were off. The average UK salary is £26,664 which works out at £73.05 per day, so over 77 days an employee would receive £5,625. An employee on SSP would receive £4,671 less during the time they were on unpaid sick leave. All other calculations and statistics based on the research conducted by OnePoll on behalf of LV= in September 2013.