Building the Business Case for Workplace Wellbeing - 10 Key Reasons to Invest

Although the press is often telling us that employee wellbeing is rising up the organisational agenda, many still don’t make the link between happy, healthy employees and a high performing business.

Often the commercial chiefs are sceptical of the benefits of investing in wellbeing – paying lip service to the importance of people, but suggesting that programmes just create a 'feel good factor', rather than any evidence to show bottom line impact. And some may think it’s the individual’s responsibility to look after their health, not something for an organisation to proactively promote and support.

If this sounds familiar, this blog is for you!

I will outline the 10 main advantages that the smartest businesses enjoy as a result of investing in workplace wellbeing.

I’ll also spotlight the supporting research in simple, accessible terms. This will give you the hard evidence to build a compelling business case and convince even the most cynical FD!

Let’s start with ‘wellbeing’. What does it mean? People often think about wellbeing in terms of their physical condition and the impact that things like diet, exercise and sleep can have on their health.

However, psychologists agree that the term ‘wellbeing’ really covers a broader range of factors, including our emotional health, social connection, intellectual stimulation and quality of life. We all have our own priorities and aspirations, so defining ‘wellbeing’ is actually a personal matter, and different aspects of wellbeing will be more important to some than others

On average, we spend around one third of our lives at work, so employers can clearly have a big impact on our health and quality of life, and as such have a vital role to play. Our wellbeing at work is influenced by many factors, including:

· our workload, and the level of autonomy we enjoy;

· the support we get from our managers;

· the strength of our relationships with colleagues:

· whether there is good leadership and a company culture based on trust;

· whether we feel we have a voice at work, and will be listened to;

· how change is communicated and managed;

· the opportunities we get for learning and development; and

· our physical working environment.

Poor health and absence from work present a phenomenal cost to workplaces in the UK.

The Office for National Statistics estimated that 141.4 million working days were lost because of sickness or injury in the UK in 2018.

The average number of days absence in 2019 was 6.4 days, costing organisations an average of £568 per employee per year (Xpert HR survey of 250,000 employees)

And when you factor in the impact of presenteeism (i.e. working when you are unwell), research tells us we actually lose on average 38 productive days per employee per year (Britain’s Healthiest Business Awards, 2019)

The CIPD’s UK Working Lives survey shows that work acts as a considerable stressor for many of us. Intense and stressful working conditions – including feeling exhausted, miserable or under excessive pressure – are reported by up to one in four workers.

Mind reports that 1 in 6 people experience a common mental health problem (like anxiety or depression) in any week in England.

Poor mental health costs UK employers up to £45 billion a year, according to a 2020 analysis by Deloitte UK.

And the COVID-19 pandemic, has, of course, exacerbated things for individuals and employers. In their study of 7 European countries, AXA Health UK found that the number of people reporting poor mental health tripled during the pandemic. Many people reported an increase in work stress and a worsening in their financial situations.

A study of over 16,000 people by Mind carried out during the first 2020 lockdown shows that two-thirds of UK adults over 25 with an existing mental health problem said their mental health had declined during the lockdown. Meanwhile, more than 20% of adults with no previous experience of mental health problems said their mental health had become poor or very poor.

There is a substantial and growing body of evidence to show that organisations who invest in their workforce’s wellbeing experience substantial benefits. So, it’s definitely the right thing to do…not only for the person but ALSO for the business.

Here are the TOP 10 ORGANISATIONAL BENEFITS to help you develop your business case:

The CIPD 2020 Health and Wellbeing at Work report surveyed over 1000 people professionals, representing 4.5 million employees in the UK. They found that lower sickness absence was one of the top three benefits that employers saw when improving wellbeing at work.

The government commissioned 2008 Black Report studied the health of Britain’s working age population. It analysed the outcomes of 55 organisational wellness programmes, and found a reduction of sickness absence in 82% of the organisations.

When employers increase their focus on employee wellbeing, one of the top benefits identified was better morale and employee engagement (CIPD 2020 Health and Wellbeing at Work survey)

And the 2010 survey conducted by the World Economic Forum and Right Management found that when health and wellbeing are actively promoted, employees are 8 times more likely to be engaged.

In their meta-analysis covering 111 studies, Ford et al (2011)[1], found clear links between health measures and work productivity – the better the individual’s psychological and physical health scores, the better their workplace performance.

Recent research by Deloitte UK found that for every £1 employers spend on mental health interventions, they get £5 back in reduced absence, lower presenteeism and lower staff turnover.

A report by the Royal College of Physicians found that NHS Trusts that have high scores on their Health and Wellbeing index perform better across a range of measures, including management of finance, spend on agency staff and patient satisfaction.

Furthermore, FTSE 100 companies demonstrating best practice in employee health and wellbeing show a higher than average shareholder return - 61% instead of 51% (BITC/Ipsos MORI, 2010)

A 2011 survey conducted by the World Economic Forum and Right Management found that organisations promoting health and wellbeing are seen as 3.5 times more likely to be creative and innovative

In a meta-analysis reviewing customer data across 24 different studies, Harter et al, (2002)[2] found positive associations between employee engagement and wellbeing scores and customer loyalty and satisfaction.

Research published in the BMC Public Health journal showed that in organisations where workers report high levels of stress, healthcare costs are nearly 50% greater than at other organisations.

A study by the APA quoted in Harvard Business Review found that employees suffering from burn-out are nearly 3 times as likely to be actively seeking a different job.

And research from Unum and Oxford Economics in 2014 highlighted in HR Review found that the average cost associated with replacing a member of staff is £30,000 (including lost productivity, recruitment fees, management time, temporary cover, and induction)

Failing to maintain a safe working environment may lead to legal claims e.g. under the Working Time regulations; Equality Act and/or Disability Discrimination Act.

Defending such claims is a lengthy and expensive process and payouts to successful parties can be huge. Official 2019/20 statistics published by the Ministry of Justice show that the average pay out for a Disability Discrimination case was £27,000 but the maximum was a whopping £266,000.

The Taylor Review (2017) examined all aspects of 'good work' and concluded, amongst many things, that improving workplace wellbeing can have positive repercussions throughout society.

These academic research findings and case studies will provide a really useful base for developing your case, but remember to draw upon data within your own organisation too.

Identify your local issues – is it high spend on health insurance? Increased absence? Difficulty attracting talent? Tie these into your organisational goals and then join the dots for the people you need to influence by making a clear link between the problems and the solutions.

It is also really important to emphasise the need to be proactive with employee health and wellbeing. Many organisations provide private healthcare cover, mental health first aid and counselling. These are good, but they are all reactive - treating the symptoms rather than addressing the source.

Get people focused on PREVENTATIVE measures and drive investment around things like management development; health education and promotion; resilience training and enhancing company culture. You can use an employee wellbeing survey and/or stress risk assessment to work out the key areas to target.

Create a group of wellbeing champions - influencers throughout the business that others will listen to, and find a senior sponsor who can support you in your quest.

And finally, if you already have some initiatives or services in place, make sure you evaluate them and how well they meet current needs and/or where the gaps lie. Devise a new pilot programme and measure it effectively to prove it's worth.

Good luck!

 [1] Ford, M. T., Cerasoli, C.P., Higgins, J.A. and Decesare, A.L. (2011) ‘Relationships between psychological, physical, and behavioural health and work performance: A review and meta-analysis’, Work & Stress, 25(3), pp. 185–204.
 
 [2] Harter, J. K., Schmidt, F. L., & Hayes, T. L. (2002). Business-unit-level relationship between employee satisfaction, employee engagement, and business outcomes: a meta-analysis. Journal of applied psychology, 87(2), 268