People in the UK are living and working longer than ever before. However, the Covid-19 pandemic and its aftermath have exposed serious physical and mental health issues facing our workforce. Declining population health is a long-term trend that is forecast to get worse in coming years.

Over the last century, rights and access to time off work have steadily increased. However, our ageing workforce today has more complex health needs and evolving responsibilities outside of paid work. Currently, 2.83 million people are economically inactive due to long-term health issues, and the Health Foundation predicts a significant rise in working-age adults with major illnesses by 2040. Meanwhile, the International Longevity Centre has warned that the retirement age may rise to 71 by 2050, indicating workers will continue to be expected to work longer.

Employers are facing worker shortages in key sectors as the economy recovers after the pandemic and global economic shocks. Ahead of the General Election in July 2024, policymakers are under pressure to grow the working population and the economy over the coming Parliament.

Our latest report investigates whether current time off policies are sufficient to support an older and sicker workforce stay-in or return to work and challenges the next UK Government and employers on how they can use existing time-off policies and new models to enable workers to live healthier lives.

Key findings:

· 3.5% of the UK workforce (1.15 million) are not eligible for Statutory Sick Pay (SSP) as they do not meet the earnings threshold of £123 per week

· Ineligibility disproportionately impacts groups already facing structural inequalities in the labour market – nearly two thirds are women (69.2%), a third are disabled workers (33%) and over half are young workers aged 16-24 (52.4%)

· Even when a worker is eligible, SSP currently replaces just 17% of average weekly earnings and its value has halved relative to earnings since its introduction in the 1980s

· Over a quarter of employers (29%) have reported a rise in sickness absence of their employees in the last four years, nearly half of employers (47%) do not go beyond the statutory minimum level of sick pay provision

· Employees with earnings below the UK average income (£32,882 per annum) have on average two fewer days of annual leave entitlement per year than those with earnings above the UK average

· Almost a third (32%) of those earning above the average income have an entitlement to annual leave that exceeds 30 days, while only a quarter of those who earn lower than the average income do so (25.4%). This makes above average earners 1.26 times more likely than lower paid workers to have over 30 days annual leave.

Recommendations

To help boost and sustain levels of labour market participation in the future, the Work Foundation calls on the next UK Government to:

1.Strengthen statutory leave policies through a comprehensive Employment Bill within the first 100 days in office

2.Commission an Independent Review on Statutory Leave and Pay to establish the fairness, flexibility, and suitability of leave for the future labour market

Read the full briefing here.

Related Reports

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  Shifting Priorities? Employer responsibility in the third year of the cost of living crisis

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  The Disability Gap: Insecure work in the UK

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  Employer briefing: Financial wellbeing during the cost of living crisis