Incentives such as tax relief for employer health benefits will be critical to encourage take-up of changes proposed by the Keep Britain Working Review as it enters its secondary stages.
However, the review authors emphasised these incentives should not be something for nothing and should reward positive behaviours and employment practices.
They added these incentives would be needed in addition to compelling evidence of return on investment and best practice which would be the key drivers but not enough alone.
The review outlined several potential incentive areas for employers focusing on two broad categories – financial incentives ranging from procurement through to tax benefits, and risk reduction incentives addressing the fear of disputes and litigation.
Financial Incentives
The authors said there was a strong case for considering financial support for employers where they are embracing good practice.
These incentives could evolve over time as the evidence base strengthens, and range from more straightforward to deliver, to more challenging, requiring more evidence to support.
- Public procurement: Adoption of the certified healthy working lifecycle could be recognised in government procurement scoring, and in projects where the public sector is a stakeholder or investor.
- Reserved contracts: Reserved contracts can be targeted at employers supporting vulnerable or underrepresented groups. Successful models already exist in the UK and Denmark.
- Access to pooled funding or risk pooling: Pooled funding or risk pooling could make high-quality WHP services more affordable, especially for smaller employers – similar to auto-enrolment in pensions. Adoption of the certified lifecycle could be a condition for access to the economies of scale or built into pricing.
- Tax relief on benefits in kind: Employers certified as adopters could receive tax relief on investments in workplace health and adjustments that enable people to stay in work.
- Sick pay rebates: Certified adopters could qualify for partial rebates, especially if they use evidence-based practices such as phased returns. This could be applied to either statutory or occupational sick pay to encourage greater support to employees.
- National Insurance adjustments: Over time, rebates and/or surcharges could reflect whether employers’ actions are reducing or increasing public benefit including the flow of people out of work and onto welfare.
Risk Reduction Incentives
Many employers said they feared disputes when managing health issues, especially when employees can no longer perform their original role. This fear often led to distance, adversarial processes, and reliance on tribunals – outcomes which the authors said rarely benefitted either side.
With the expected introduction of day-one employment rights, these fears may grow and so fast-tracking alternative dispute resolution (ADR) was recommended alongside the reforms.
The report also endorsed draft proposals from a review on employment dispute resolution.
Employee incentives
The review also recognised that employer incentives alone would not be enough and so employees must also been encouraged to stay engaged, disclose early, and take up support.
These could be in the form of financial and contractual incentives or cultural incentives.
It highlighted that too often, employees who developed health conditions quickly detached from their workplace, exacerbated by fear and the disconnection that comes from long periods signed off with fit notes.
“Instead, we want policies that maintain contact and build trust, improving return-to-work outcomes.”
This included understanding the potential benefits of a higher rate of occupational sick pay and looking at ways to build engagement in rehabilitation and return to work alongside the financial support offered.
This could include reasonable conditionality for accessing the higher rate, including a requirement to engage with support where that is provided.
It added that early disclosure and open, honest communication are critical to successful management of health and disability in the workplace.
“Humanising support is in part about creating a cultural shift that changes how we talk about health and disability, breaking the stigma, encouraging a dialogue around what is possible and adopting impactful interventions that enable someone to undertake their role successfully,” the review said.
It added that the early stages should explore how to incentivise better approaches that can encourage earlier disclosure, embed a preventative approach and enable better support.