Is sick leave sinking South Africa’s SMEs?

SMALL and medium-sized enterprises (SMEs) are the backbone of South Africa's economy; employing millions and driving growth.

- NEIL KINSLEY

However, they are facing a silent crisis: the disease burden on their workforce is significantly greater than previously thought, due in large part to the average age of workers increasing. This is leading to absenteeism, declining productivity and financial strain.

According to the Human Capital Review, absenteeism costs the South African economy approximately R19.1 billion annually, with around 15% of employees absent on any given day.

For SMEs, where every employee plays a critical role, even one worker being off sick can disrupt operations and lead to revenue losses.

The reality is that SMEs cannot afford a high burden of disease in their workforce. Unlike large corporations that have the resources to absorb productivity losses, small businesses operate with lean teams where each absence is felt more acutely.

From the moment an employee commences his/her employment, the sick leave cycle starts. In South Africa, a "sick leave cycle" is a period of 36 months of employment. During every sick leave cycle, an employee is entitled to an amount of paid sick leave equal to the number of days the employee would normally work during a period of six weeks. An employee who works five days per week is entitled to 30 days every 36 months.

Disease burden