Over the last years, absenteeism due to poor mental health has increased steadily, costing organizations billions every year. The following article will help you understand the relationship between mental health and absenteeism and how your company can take action to save costs.
How Mental Health Affects Absenteeism
Mental health plays a crucial role in an employee's ability to perform effectively at work. When employees struggle with mental health issues, they may find it harder to concentrate, collaborate with colleagues, and stay engaged in their tasks.
Research consistently shows that poor mental health negatively impacts workplace productivity. In some cases, it can even prevent employees from feeling capable of working at all, leading to increased sick leave (absenteeism).
It's important to recognize that many mental health challenges stem from work-related stress. One study found that one-third of all burnout cases were caused solely by professional factors, while another third cited work as a contributing factor.
How Absenteeism Affects Companies
Mental health-related absenteeism costs businesses substantial amounts of money every year. In Germany, for example, companies lose an average of €288 per employee for each day of absence. With employees taking an average of 11.2 sick days annually, and 17.5% of those due to mental health, this results in an estimated loss of €56,448 per 100 employees each year.
However, the problem goes beyond just the financial loss. Absences due to mental health conditions tend to be significantly longer than other types of sick leave, averaging 43.3 days per case.
Beyond absenteeism, many employees continue to work despite struggling with mental health issues—often referred to as "presenteeism." These employees may not be fully productive, leading to hidden costs for organizations.
The Role of Mental Health Support in Reducing Absenteeism
Studies show that providing employees with mental health resources—such as Employee Assistance Programs (EAPs) or digital platforms like nilo—can significantly reduce absenteeism and improve workplace productivity.
Employees who access mental health support through an EAP or similar service tend to recover and return to full productivity more quickly than those who do not. Additionally, mental health programs have been shown to deliver a strong return on investment (ROI), generating between $5.00 and $6.00 for every dollar spent.
How to Prevent an Increase in Mental Health-Related Absenteeism
One of the most effective ways to reduce mental health-related absenteeism is to foster a workplace culture that normalizes mental health discussions. When employees feel safe discussing their mental health, they are more likely to seek support early—preventing issues from escalating to the point where extended sick leave is required.
Creating a supportive environment can also help employees recover faster, as they can identify the right resources and solutions before their mental health deteriorates further.
Three Key Steps Organizations Can Take
Step 1: Raise Awareness and Educate
Employers, leaders, and HR professionals can start by openly discussing mental health within the organization. Providing access to educational resources—such as articles, workshops, or expert-led webinars—can help build awareness and encourage employees to prioritize their mental well-being.
Step 2: Training and Upskilling
Organizations can equip employees and managers with the skills to recognize early signs of mental health struggles. Offering psychological first-aid training or specialized upskilling programs—such as workshops for HR teams and leadership—can empower teams to provide appropriate support.
Step 3: Implement Mental Health Programs
Finally, businesses should actively invest in accessible mental health support for employees. This can include:
- One-on-one sessions with psychologists or coaches
- Group support sessions
- Self-guided mental health tools
While some companies choose to hire in-house psychologists or use traditional EAPs, digital platforms like nilo offer flexible, scalable, and easily accessible support solutions.
Ready to create a healthier, more engaged workforce today? Let's talk.
