The true cost of stress

Stress in the workplace can have devastating effects on employees. Sam Barrett finds out what adviser solutions can and can’t do to help

In today’s tough economic climate, employees are coming under increasing pressure. Employers must take steps to manage stress in the workplace to safeguard their employees and their businesses.

“Companies are putting employees under more and more pressure,” says Colin Bullen, head of health and risk benefits at Hewitt Associates. “If the company’s downsized, employees might be struggling with a heavier workload. There could also be financial worries and fears about job security. It can all lead to more stress in the workplace.”

In some instances this increased pressure can have particularly unpleasant consequences. This was the case at France Telecom earlier this year when it hit the headlines as the suicide rate among its employees soared.

The firm, which had made 22,000 people redundant between 2006 and 2008, has experienced 24 suicides in the last 20 months. Although it claims this isn’t an unusual suicide rate for a company of its size, it has put further restructuring on hold and introduced a suicide hotline and psychological counselling.

No one is suggesting that introducing a range of products would have stopped this happening. But providers do offer a range of solutions from employee assistance programmes (EAPs) to cash plans and medical insurance that claim to help an employer combat stress in the workplace.

Success isn’t guaranteed though. In work carried out by the Health & Safety Executive in the late 1990s on stress in the workplace, it categorised the types of stress intervention as primary, secondary and tertiary. While primary and secondary interventions are proactive and include reducing exposure to stress and training employees in stress management, employee benefits are classed as tertiary interventions.

“When it comes to managing stress in the workplace, employee benefits are much more of a reactive mechanism,” says Ann McCracken, chair of the International Stress Management Association (ISMA). “By the time you use them it’s often too late as someone is already suffering from stress. You need to be more proactive and look at preventative steps too.”

This is particularly the case with a benefit such as medical insurance. Although some policies include stress helplines, the cover for psychiatric treatment would only really kick in once someone is unable to work as a result of a mental health problem. At this stage, the chances of their returning to work can be greatly reduced.

Even the benefits that are specifically designed for reducing stress can be ineffectual if they’re not used correctly. As an example, Dr Doug Wright, principal clinical consultant at Aviva UK Health, points to an EAP. “You can’t just make an EAP available and expect staff to get on with it. Low usage isn’t necessarily a sign you don’t have a problem. It might be an indication that employees don’t know it’s there or are worried it’s not confidential. It’s essential to communicate it as a benefit,” he explains. This situation can be exacerbated further when EAPs are priced on usage. Then, there is a real danger that any promotion is kept to a minimum to keep costs down.

But, while these products do have a place in managing employee stress, forward thinking consultants are looking to a broader strategy. James Kenrick, leader of corporate healthcare consulting at Hewitt Associates, explains: “It’s not just about the healthcare products. You need a health management approach that ensures if someone is beginning to feel stressed they receive the support they need quickly whether this is referral to the EAP or stress vocational rehabilitation services. This reduces the likelihood of them needing to take time off and can have a major impact on long term absence.”

This more integrated approach does deliver results. As an example, Hewitt Associates has a health management initiative for its own employees. This has reduced stress related absence from between 10 and 11 per cent of absence to just 6 per cent. “We’ve calculated that where you use this approach you get a return of £4 for every £1 you spend,” says Bullen.

At the heart of this type of strategy are the legal requirements, namely a stress policy and a stress audit. These help to show that stress istaken seriously within the organisation and are a valuable way to communicate an employer’s intent.

While it’s possible to buy in stress audits, free tools are also available. Dave Middleton, client relationship director at Portus Consulting, explains: “The Health & Safety Executive has a toolkit that accompanies its management standards for work-related stress. These are good tools that can help an employer identify issues in the workplace and find ways to resolve them.”

Because early identification of stress is a key part of this strategy a sickness absence management system can also be a sensible component of a stress management strategy. “These can help identify potential problems,” says Geoff Taylor, consultant for specialist services department at Axa Icas. “The data can be used to identify patterns that might be an indication of something more serious.”

For example, if an employee is taking a lot of short term absence it may be worth further investigation to see if there is an underlying problem, such as stress, that is behind it. But, while this can help, Taylor adds that it should be part of a broader strategy. “Identifying the problem isn’t enough,” he says. “You need to be able to refer people on to other support such as counselling if necessary.”

To improve the success of a stress management strategy, Middleton believes that greater awareness of stress is essential. “Throwing an EAP into the mix isn’t going to solve stress in the workplace. Line managers need to be trained so they can recognise the signs of stress and support employees. This will help them deal with stress effectively and before it becomes a major issue.”

The ISMA’s McCracken agrees. She believes that line managers are often promoted because they are good at their job rather than because they’re good at managing people. “Employers need to help line managers develop these competencies. This will give them greater confidence to deal with stress in the workplace,” she explains.

Within this more receptive framework, products can work more effectively. For example, where line managers are trained to identify signs of stress they can refer employees to the EAP. Similarly, as many EAPs can also be used as a support mechanism for managers, they can turn to it themselves if they are unsure how to deal with a workplace situation.

While all these steps will help employees to feel more supported and able to ask for help if they start to suffer from stress, some organisations can find that their culture is so macho, stress is still seen as a weakness that employees can’t admit to suffering from it. “You need to get buy in from the top of the organisation,” says Bullen. “If the CEO believes in the strategy it will be easier to get employees to use it.”

As well as getting buy-in from the top, there are other strategies that can be used to change the culture in a workplace. Middleton suggests raising the profile of health and wellbeing through wellness days. “We are seeing more companies focus on wellbeing,” he explains. “A wellness day can show employees that their health is taken seriously and it’s also a good way to promote health benefits you might have in place.”

In focus

Stress: An employer’s legal responsibility

Ann McCracken, chair, International Stress Management Asociation

“Employers must safeguard both physical and mental health in the workplace”

Under the Health and Safety at Work Act 1974 employers have a legal responsibility to ensure, as far as is practical, the health, safety and welfare at work of their employees. “Employers must safeguard their employee’s mental as well as physical health in the workplace,” says Ann McCracken, chair of the International Stress Management Association.

In terms of the practicalities, this means having a formal policy on stress, often as part of the health and safety policy, and carrying out regular stress risk assessments. “The Health and Safety Executive has an audit tool that relates to its management standards but other audits can be used instead,” says McCracken. “This is totally confidential but can identify any problems.”

Although there are no reporting requirements, the HSE can take action by serving an improvement order if it identifies any issues. This gives the employer six months to make changes.

No specific products are recommended as part of an employer’s arsenal to beat stress. Employee assistance programmes (EAPs) were seen as the answer to stress in the workplace following the Court of Appeal ruling in the case of Sutherland v Hatton in 2002, but this was subsequently overruled. “Some employers did interpret this ruling as meaning that having an EAP was sufficient to protect them from a stress claim but this was overruled quite clearly. An EAP can help but the employer must be more proactive in safeguarding employees from stress.”
More details of the Health & Safety Executive’s management standards and stress tools can be found at: