Select Committee on Work and Pensions Written Evidence

Memorandum submitted by the Association of British Insurers


  Vocational Rehabilitation and Occupational Health are different but extremely valuable tools in prevention, promotion, and improvement in the health of the working population.

  At present, UK employers don't make enough provision for their employees' health. This is due to both economic reasons, and a lack of understanding and information. A significant increase in employee health interventions would make a huge difference to the wellbeing of individuals, businesses, and the UK as a whole.

  The Health & Safety Executive and Commission should have a duty to encourage and promote the growth of vocational rehabilitation in all sizes of business in the UK. They should also actively promote other occupational health interventions, ensuring that both preventative and reactive approaches to good health are taken.


  The Association of British Insurers (ABI) represents nearly 400 member companies, which between them provide 94% of the UK's domestic insurance. It works on behalf of the UK insurance industry to keep standards high and to make its voice heard.


  1.  There is a great deal of evidence from around the world about the benefits of vocational rehabilitation (VR) in returning people to work quickly and cost effectively. While these results cannot always be directly translated to the UK, due to the difference in systems of employer liability and workers' compensation, it is clearly the case that VR could make a very significant contribution to improving health, productivity, economic performance, and lessening the burden on the State of ill health and workplace absence.

  2.  At present too many people leave the workplace permanently due to ill health or injury. There are a number of reasons for this. The NHS does not recognise work as a contributor to good health, as identified by Waddell & Burton in their 2006 report, Is work good for your health and wellbeing? [61]And GPs are often unaware of the importance of work.[62] Employees are too often repeatedly signed off, and end up "convalescing" at home while either waiting for further treatment or recovering from an injury. This can lead to isolation, decline in self-confidence and worsening of mental or physical conditions. Often they will never return to work, and instead move onto benefits, leading in part to the 2.64million people now on Incapacity Benefit.

  3.  A further reason for the UK's sub-optimal performance is the lack of understanding and engagement from the employer. Few employers make provision for preventative healthcare, nor provide those interventions that could get employees back to work quickly. There are a number of causes of this, including lack of understanding of the costs of ill health to their business, lack of knowledge of the interventions that are available, and the belief that such provision would be too expensive.

  4.  VR encompasses a series of measures that can help a person get back into work after an injury or illness. Among these are health advice, career counselling, workplace adjustments, goal setting, assessment and appraisal, support for self management of conditions, case management, information about and access to rehabilitation technology, among others.[63] VR differs from medical rehabilitation as it focuses on the individual and their work, rather than the individual and their condition. VR can enable individuals to go back to work while they are undergoing medical treatments, and it encourages them to get back to a form of normality, rather than slowly withdrawing from day to day life as many who stop working through illness or injury do now.

  5.  VR is often provided by insurers as part of the Employers Liability insurance, or other policies, such as Group Income Protection. This can cover employees for injuries or illness suffered as part of their job. Insurers report that this can result in speeding up of notification of claims under Employers Liability insurance, and can accelerate return to work.

  6.  There are currently a number of barriers to the extension of the availability of VR. SMEs are less likely to show interest in, or have knowledge of, the potential of VR, and often believe that it won't make any difference to them, due to their size. Furthermore, the current tax system means that offering VR to people who suffer illness or an injury away from the workplace will be taxed as a benefit in kind. 175 million days per year are lost as a result of ill health in total, with HSE figures showing that 30 million of these are illnesses or injuries suffered at or caused by work. HSE figures show that 1.3 days per worker were lost in 2005-06 as a result of work-related ill health and workplace injuries.[64] However, the total days lost per worker (for all types of absence) was found to be 8.4 days in 2006, in the Chartered Institute of Personnel Development study,[65] and seven days per employee in the CBI/Axa survey.[66] These figures illustrate the importance of not just concentrating on the injuries and illnesses that happen at work.


  7.  Occupational Health (OH) is a term generally used to cover those interventions that are largely preventative in nature. Among the measures that fall under OH are: the provision of OH doctors and/or nurses; health and safety professionals; occupational hygienists; OH technicians; ergonomics; physiotherapy; Employee Assistance Programmes (EAPs); health surveillance.[67] Comprehensive absence management systems also fall into OH, and these can provide extremely positive impacts on levels of absence, and improved rates of return to work.

  8.  Insurers can provide occupational health services as part of Private Medical Insurance packages, as well as other insurance products, recognising that the preventative elements of good OH can lead to a reduction in incidences of ill health, both caused by work, and that in society at large.

  9.  The importance of OH services are their preventative character. By carrying out screenings, checks, conversations, and practical contributions to the day to day business activity, OH makes it easier to avoid the accidents, the injuries and the illnesses that can arise in the workplace. The outsourcing of many human resources functions to remote locations by many businesses has contributed to the difficulty in having an active OH presence in more companies.


  10.  Given the pressures on the NHS to provide a large range of universal services, it is unrealistic to expect it to prioritise all that we may wish for, and even more unrealistic to believe that it can know and understand the needs of all the UK's 29 million employees. The most effective way to improve employee health would be to encourage and incentivise businesses to make more provision for the health of their own employees, regardless of their sector or the size. An individual relationship between an employer and its VR or OH provider is an extremely effective way of ensuring that the exact nature of the work undertaken by the employee can be understood, and vocational rehabilitation can take place.

  11.  Most healthcare professionals are understandably focused on the medical needs of their patients. It would need major reforms to the training of GPs, nurses and other healthcare professionals to change this. VR and OH professionals are focused on the interaction between the individual and their work, whether that be in ensuring that the workplace is properly adapted to the individual, that good procedures are in place, that the wellbeing of the employee is being monitored, or that screening is in place for any typical conditions that may arise.

  12.  The common goal, to reduce the frequency and length of absences, improving employee health and wellbeing, improving business performance, reducing the burden on the state of ill health, is most likely to be achieved through encouraging employers to understand the costs and causes of absence in their own business, and take appropriate steps.

  13.  The ABI is a member of the Vocational Rehabilitation Task Group, set up by the DWP in 2007 to address a number of factors obstructing better provision of VR.[68] The ABI is currently looking at the incentives and disincentives existing in the VR market, and will make recommendations in the first quarter of 2008. The task group is also looking at good practice in VR, and how the benefits can be communicated to employers through advice and guidance.


  14.  The ABI supports the amendment of the Health and Safety at Work Act to give the HSE a statutory duty to promote rehabilitation, and to promote good practice when illness and injuries occur, including producing return to work plans by employers. HSE is well placed to encourage employers to make such provision, interacting as it does with many businesses which are prone to higher risks in the workplace. The ABI finds that many employers are not knowledgeable about the impact that VR can make, and HSE could reinforce the messages coming from elsewhere.

  15.  The HSE should work more closely with the NHS to ensure that its services are better aligned with the needs of UK employers. HSE PSA targets to reduce the number of days lost due to injuries and illness could be shared with the NHS.

  16.  The HSE produces some very valuable and useful guidance on managing specific types of illness in the workplace, especially mental health, and these should be promoted more vigorously.

  17.  Delays in reporting claims to insurers can impair the operation of the Employers' Liability (EL) insurance market. On average, it takes 400 days to report a claim to an insurer. This increases costs significantly, makes it more difficult to provide effective rehabilitation, and can contribute to higher costs for EL insurance itself. The HSE should examine the RIDDOR system of reporting injuries to see if it can be used to accelerate the notification of claims, flag up potential claims, and speed up VR, and potentially speed up the return to work, improving outcomes for all involved.

Association of British Insurers

January 2008

61   Is Work Good for your health and wellbeing? Waddell & Burton, TSO, 2006. Back

62 Back

63   Occupational Health 2008, making the business case. Thornbury/Workplace Law. Back

64   Self-reported work-related illness and workplace injuries in 2005-06: results from the Labour Force Survey. HSE/National Statistics. July 2007. Back

65   Absence Management, CIPD, 2007. Back

66   Attending to Absence, CBI/Axa, May 2007. Back

67   Thornbury/Workplace Law. Back

68 Back

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