Why the sick man Germany is paying up to curb sick days
While they’re still known internationally for their work ethic, Germans aren’t shy about calling in sick
WITH staff absences soaring in Germany, employers such as Tesla are reaching for an eye-catching tool to motivate workers to show up: a bonus for taking fewer sick days.
Attendance incentives are problematic – not least because they incentivise presenteeism, which could spread infection – but the fact that companies are considering such extreme measures speaks to the severity of the workforce crisis engulfing Europe’s biggest economy.
A combination of increased respiratory infections in the wake of Covid and deteriorating mental health have propelled sickness absences to the highest in Germany’s post-reunification history, impairing economic growth and exacerbating labour shortages, while heaping extra burdens onto businesses and the roughly one-third of workers who consistently show up.
Suspicions are growing that some employees are staying home even when they’re not ill, enabled by generous sickness-pay arrangements and pandemic-era rules that make it easier to phone in sick.
The situation is far removed from what’s happening in the US, which shamefully still doesn’t guarantee paid sick leave and where workers on average take a couple of days off a year due to illness. (UK workers are absent around eight days on average.)
Highest rates
In Germany, that figure has increased to at least 15 days per employee, and some estimates put the total nearer 20. This is one of highest rates in Europe; if attendance was better, Germany could have avoided a recession last year, economists say.
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Weighing German plant closures and compulsory redundancies for the first time, managers at Volkswagen have warned that around 10 per cent of production line workers are now absent, according to German tabloid Bild.
This is more than double the expected level and is costing the automaker one billion euros (S$1.44 billion) per year.
Facing similar staffing problems at its factory near Berlin, Tesla is experimenting with an unusual solution: a bonus of up to 1,000 euros for consistently showing up.
For now, the pilot programme is limited to just 100 employees, plant manager Andre Thierig told German newspaper Handelsblatt in June, adding that to get the full amount, workers need an attendance rate of at least 95 per cent.
Tesla isn’t alone: The city of Kiel’s transport company, KVG, is paying bus drivers up to 250 euros extra per quarter for good attendance: a 100 per cent attendance record guarantees the full amount, while employees taking three or four days off get half.
(Mercedes-Benz Group began offering a 50-euro-per-quarter attendance bonus for German workers in 2017, but the programme was discontinued two years later.)
These incentives make me uncomfortable for several reasons: Managers should first examine whether there are other reasons why staff aren’t coming to work.
The last thing Germany needs is employees in poor health spreading germs just to earn some extra cash; such policies also penalise workers with serious or chronic conditions who have no chance of getting a bonus.
Paying people extra to fulfil their contractual obligations also risks devaluing employment, poisoning workplace harmony and triggering unintended consequences – when apprentices at a German supermarket chain were offered attendance incentives, absenteeism increased by around 50 per cent, because monetary incentives made shirking seem acceptable, according to a 2023 study.
No easy options
But employers lack easy options to combat absenteeism: Until now a relatively strong job market, combined with labour shortages in key sectors, has given employees the upper hand.
While they’re still known internationally for their work ethic, Germans aren’t shy about calling in sick: almost 60 per cent admitted to having done so when in reality they were fit to work, according to survey conducted in November by health insurer Pronova BKK.
(The same survey found employees have become far more reluctant to go to work when they’re feeling unwell – a positive development.)
It isn’t easy for managers to broach such a sensitive topic and there’s little besides guilt to dissuade staff from staying home. Germans are entitled to up to six weeks of sickness leave on full pay; the costs are shouldered by companies and amount to around 70 billion euros annually.
(Thereafter, workers can get up to 70 per cent of gross wages covered by their health insurer for up to 72 weeks.)
Sickness benefits don’t end there: burned-out workers can ask their doctor to send them to a health retreat or “kur” for up to three weeks, with most of the costs picked up by their insurer.
Nicolas Ziebarth, an expert on the economics of sick leave at the ZEW-Leibniz Center for European Economic Research, told me: “Americans are flabbergasted when they hear about the German system; if you guarantee workers 100 per cent of their salary for several weeks, then of course people will call in sick at the margins. Germans simply don’t accept that you would punish them for being ill.”
Political obstacles
Reforming the system looks politically impossible: when former chancellor Helmut Kohl’s centre-right government cut sickness benefits to 80 per cent of gross income in the 1990s, protests were so fierce the policy was soon reversed.
Today’s coalition government has at least promised to review regulations allowing doctors to excuse patients from work for up to five days by telephone – without seeing them in person.
The rules were established during the pandemic to prevent patients crowding doctor’s surgeries and spreading infection, and hence I wouldn’t expect much to change.
Still, the status quo is untenable and risks creating a vicious circle: Germany’s workforce is ageing and will therefore become increasingly prone to illness.
As the working age population shrinks, the pressure on employees at short-staffed companies and institutions will increase, meaning they tend to get sick more frequently.
(Sickness rates are particularly high among daycare workers; if short-staffed facilities are forced to close then parents may be forced to miss work.)
And if companies are forced to pay workers extra to ensure they show up, next time they may decide to hire or invest elsewhere.
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