Author: Sarah Carter, below, Head of Account Management, Onebright

Over the past decade or more, a solid mental health policy in the workplace has definitely gone from being a nice-to-have to something every company must have. This is not just a product of the societal values ​​of the time that dictate the way we work, but a sign that increased understanding of mental health has made it a simple business decision. We now know that the lack of effective mental health services is costing companies billions.

Poorly managing mental health benefits in the workplace not only impacts on employee wellbeing, but also has serious financial and productivity repercussions for organisations. The economic cost of poor mental health is estimated at a staggering £110 billion per year. This includes the costs to businesses of sickness absence, presenteeism and staff turnover.

Cost of absence

It is estimated that 18 million working days are lost in the UK each year due to mental ill health. When absent due to mental health, as with any other illness, businesses incur costs associated with paying overtime for other staff to cover the absent employee’s duties, and the potential costs of temporary employment. In addition, frequent absences of skilled workers can disrupt workflows and project schedules, further impacting the bottom line. If absences due to mental ill health are as costly as any other, shouldn’t the workplace treat them with the same seriousness and understanding as physical illness?

Presenteeism: The Hidden Productivity Killer

While an employee on sick leave has a visible and more directly measurable impact, presenteeism – when employees are physically at work but mentally ill or struggling – is a more insidious and, in some ways, equally costly problem. Employees experiencing mental health problems can struggle to concentrate, make more mistakes and show lower levels of productivity. Some studies have even put the figure at around a third, which is just over two days of each working week lost to poor productivity.

Turnover and recruitment costs

Neglecting mental health in the workplace also contributes to higher employee turnover. Employees who feel unsupported are more likely to leave in search of jobs with better mental health policies. The cost of employee turnover is significant – it includes recruitment, training and lost productivity during the transition period. According to research by Oxford Economics, replacing an employee earning over £25,000 can cost over £30,000. For senior positions, the cost can be even higher. It is also clear that the gap between when an employee leaves and when a replacement is hired can have a greater financial and productivity impact than this.

Moral imperative and employee engagement

Beyond the financial implications, organizations have a moral imperative to support the mental health of their employees. Creating a supportive environment strengthens employee loyalty, increases engagement, and builds a positive workplace culture. Engaged employees are more productive, innovative, and committed to the success of the company. Gallup research shows that companies with high employee engagement have 21% higher profitability.

By now, the costs of poor mental health in the workplace should be obvious, but the question remains, what can you do to make sure you’re getting it right? There’s no easy solution, and many of the conversations needed to implement change won’t be easy to have, but they certainly shouldn’t be avoided.

Do it right

The first step is almost always to create and develop a formal mental health policy. These can be explicitly designed to support employees struggling with mental health issues to stay in – or return to – work.

No policy will be perfect, and people struggling with mental health can often react unexpectedly, but having some guidelines to refer to can still be helpful. It’s also important to note that while managers play an important role, they are not professionals, so companies may want to consider introducing mental health services. This can provide anything from good training for managers to actual therapy directly for employees.

By providing clinically-led mental health training, managers and business leaders will be better equipped to have the often difficult but necessary conversations with employees. These conversations should not be about any diagnosis, but rather should focus on what can be done to support an employee’s mental well-being at work.

Another aspect that is often overlooked when creating new policies and ways of working such as this is the need for change at every level. Especially at the top. Business leaders have a responsibility to ensure that they support and champion these new policies, as well as encourage an environment of openness and discussion about these issues. No employee will feel empowered to open up about their potential struggles if their boss does not take it seriously.

Finally, every employee is different. Managers must be able to be flexible in providing support. This includes, but is not limited to, adjusting hours, workload, breaks or providing a mentor to the employee.

Ultimately, there is no single solution, but taking mental health in the workplace seriously and taking steps to improve it is not only the right thing to do, but it can also save your company a lot of time and money.

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