This October will see the launch of a new, publicly funded, assessment service for employers; designed to help them manage the rising tide of sickness absence.

Part of the cross-government Health, Work and Wellbeing initiative, the 'Health and Work Service' will provide occupational health advice and support for employers, employees. It is set to launch in October.

Background

Employers currently face an annual bill of around £9 billion in sick pay and associated costs. Nearly a million employees each year are absent from work for a period of at least four weeks at a time, and around 300,000 people a year will end up falling out of work because of a health condition. To address these issues, in early 2011 the Department for Work and Pensions (DWP) requested an independent review to assess the sickness absence system and make recommendations for change.

The report by Dame Carol Black and David Frost CBE was published in November 2011. Following consultation, the government published its response in January 2013; setting out among other things its plans for the new assessment service.

The Health and Work Service is due to launch with a staged approach from October 2014, with a full national service in place by April 2015. An invitation to tender was put out to potential suppliers in January, and the contract is expected to be awarded in April 2014.

What will the service do?

There will be two 'elements' to the new service -

  1. Assessment: Once the employee has reached, or is expected to reach, four weeks of sickness absence, they will normally be referred by their GP for an assessment by an occupational health professional (OHP). In the majority of cases, the assessment will simply be via telephone. The OHP will look at all the issues preventing the employee from returning to work, and put in place a 'Return to Work Plan'.
  2. Advice: Employers, employees and GPs will all be able to access telephone and web-based general advice on health and work.

While the service will cover the wide-range of potential conditions, it will have a core focus on musculoskeletal and mental health conditions.

How will it work?

As a general rule, the 'assessment' element of the scheme will kick in when an employee has reached, or is expected to reach, four weeks of sickness absence.

Guidance to GPs (as yet unpublished) will be to refer employees who have been 'off sick' for four weeks as a default option, unless the employee meets the criteria for when such a referral would be inappropriate. These criteria will be defined by the guidance and the government has stated that they will be 'limited'. Although this will be the primary referral route for an assessment, employers will also be able to refer an employee to the service where the GP has not done so by the four-week point (although again, the circumstances in which they may do so are to be set out in guidance and have yet to be confirmed).

All referrals will require the consent of the employee, although those who do not engage with the service will risk not being provided with further 'fit notes'.

The first assessment is expected to take place within two working days of receipt of the referral. The majority of assessments will be via telephone, with an estimated five-ten per cent of employees requiring face-to-face assessments.

After the assessment, the service will provide a 'Return to Work Plan' to the employee. This will be shared with the employer and the employee's GP, subject to the employee's consent. It will contain specific advice and recommendations about actions to assist with and make an employee's return to work faster, for example temporary adjustments and/or interventions that can be made to address any obstacles and a timetable for return to work.

The plan will provide evidence of fitness for work for the purposes of receiving Statutory Sick Pay (SSP), which is currently provided by a GP-issued 'fit note'. Where an employer is in receipt of a Return to Work Plan, a 'fit note' will no longer need to be provided, although they will still be issued to cover the period between referral and the production of the plan (currently expected to be two weeks).

Running alongside all of this, employers, employees and GPs will have access to a telephone number and website which will provide them with advice about sickness absence management. Examples of the sort of information that will be available to employers include -

  • how to reduce the risk of employees going on sick leave and to support them to stay in work;
  • how to support employees who have not been formally referred for an assessment but nonetheless require additional assistance;
  • what to do when employees are self-certifying their absence from work; and
  • advice on applying recommendations within 'fit notes' from GPs.

What does this mean for employers?

The government anticipates that the service will result in a total saving for employers of £70-£160 million in 'sick pay' costs per year.

The service will be available to all employers, although inevitably it is likely to be most beneficial to smaller employers who would otherwise not routinely engage the services of OHPs. Research carried out in 2011 showed that only one in ten small employers provided employees with access to occupational health services in the previous year; compared with eight in ten large employers. The new scheme will therefore 'plug the gap' for those employers with few employees who only need advice on a sporadic basis, and those who simply cannot afford to invest in full time occupational health services.

The Health and Work Service is therefore intended to complement, rather than replace or duplicate, any existing and more comprehensive occupational health service provided by an employer. When it is identified that employer provision is already available, it is envisaged that the service will work with it - for example, it might contact the employer's service to discuss their involvement to date, or an employer service could take forward any recommended interventions.

As the GP will be the primary referral route, there should usually be no need for an employer to make a referral themselves.

Following the issue of the Return to Work Plan, employers will continue to be responsible for decisions about fitness for work; although they will be able to accept the plan as evidence for this purpose. Employers will also share responsibility with the employee and the GP for taking forward the recommendations made in the plan.

How will all this be paid for?

The service will be funded through the abolition of the Statutory Sick Pay Percentage Threshold Scheme (PTS), which currently compensates employers for higher than average sickness absence. The PTS will be abolished from 6 April this year, but employers will still be able to make claims for reimbursement of SSP paid for sickness periods up to 5 April 2014 until the end of the 2015-16 tax year.

The associated record-keeping requirements will also be abolished from 6 April, although employers will still be required to keep sickness records for pay-as-you-earn tax purposes.

In last week's Budget, the Chancellor also confirmed that a tax exemption of up to £500 a year per employee will be available to employers for contributions made towards medical treatments recommended by either the Health and Work Service, or employer-arranged occupational health provision.