Rising Sick Leave Costs Increasingly Burden Businesses
- In Switzerland, employees are now taking more than eight days of sick leave per year.
- In 2024, employees were absent from work for an average of 8.6 days due to illness or accident.
- The increase in absences is becoming a pressing problem for small businesses, who are struggling to obtain affordable insurance coverage for these sick days.
In Switzerland, employees are now taking more than eight days of sick leave per year. It is becoming increasingly challenging for companies to insure against the resulting costs.
The number of sick days is increasing in Switzerland. In 2024, employees were absent from work for an average of 8.6 days due to illness or accident. This is about a third more than 15 years ago. This increase is attributable to illnesses. Accidents, on the other hand, have decreased considerably.
The increase in absences is becoming a pressing problem for small businesses, who are struggling to obtain affordable insurance coverage for these sick days.
Why such an increase?
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The online magazine “Social Security – Soziale Sicherheit CHSS” identifies three main reasons for the increase in the number of sick days:
(1) Increase in mental health disorders: figures from two major daily allowance insurers show that cases of mental health disorders have increased by around 60% in ten years. Possible reasons include work pressure and the fact that mental health disorders are now less taboo.
(2) Covid-19 has changed behaviors:
Small businesses with high rates of employee sick leave are facing significantly increased insurance premiums, and employees are often bearing half of the cost, according to Beatrix Bock, a director at insurance brokerage Kessler & Co.
Insurance companies are increasingly hesitant to absorb the financial risk associated with frequent employee absences. Beatrix Bock explains that insurers have experienced multi-million euro losses in the past due to high sick leave claims and are now adjusting their pricing accordingly.This shift means businesses with more sick days will pay more for their insurance coverage.
Evidence of Increased Absenteeism
In 2024, employees were absent from work an average of 8.6 days per year, according to Keystone-SDA. Keystone-SDA reports that this trend is contributing to the rising costs for employers and, afterward, employees.
Insurers’ Response to Risk
Urs Gysling, director of the Swiss Health Insurers Association (VIGES), stated that insurers are becoming more selective in their underwriting practices. They are carefully evaluating the risk profiles of businesses and adjusting premiums to reflect the potential for future claims. This increased scrutiny makes it more difficult for businesses with a history of high sick leave to secure affordable insurance coverage.