https://www.dhs.net.au/news/absenteeism-is-costing-your-business-more-than-you-think#:~:text='Chucking%20a%20sickie'%20is%20costing,%243%2C500%20per%20employee%20per%20annum.
"research shows that every dollar spent on identifying, supporting and case managing employees with mental health issues yields close to a 500% return in improved productivity through increased work output and reduced absenteeism."
a2 isn't the only company that does this.
Nike gives a week. apple gives 12. They all do it, but let's cry about a2 doing it.
"Every $1 spent on improving mental health in the workplace can result in a $2.30 return on investment" improves employee loyalty and can attract and retain talent.
https://www.beyondblue.org.au/mental-health/work
Healthier employees take fewer sick days - Unplanned absenteeism’s real employer cost has been rising since the pandemic and can account for 8% of total payroll costs when direct wages and indirect costs are factored in.
If we assume that each of A2 Milk’s 490 employees takes a single paid day off annually for mental health, the cost to the company would be based on the average salary and daily wage for each employee. For simplicity assume the following:
1. Average Salary: If the average annual salary for A2 Milk employees is around $75,000 (assuming a mix of different roles across the company).
2. Daily Wage: The daily wage would be approximately $75,000 ÷ 260 workdays = $288.46.
Total Annual Cost of the Mental Health Day Off:
The initiative would cost A2 Milk approximately $141,345 annually.
Given the potential benefits in employee productivity, morale, and retention, the investment of around $141,345 is relatively modest and can be justified by the positive impact on workforce well-being and overall company culture.
With every $1 spent on improving mental health in the workplace potentially giving a $2.30 return on investment – A2 Milk’s mental health day policy is a financially sound decision in the long run. Applying this multiplier to A2 Milk’s estimated annual cost for the initiative provides a clear perspective on its value:
If A2 Milk spends around $141,345 annually on giving employees a mental health day, they could expect a potential long-term benefit of approximately $325,000 per year in terms of improved productivity, reduced absenteeism, and lower turnover costs.
1.Financial Justification: With the estimated return, A2 Milk would see substantial benefits over time, effectively “earning back” the cost of the initiative.
2.Enhanced Workplace Culture and Retention: A policy supporting mental health can improve employee loyalty, helping the company attract and retain talent.
3.Reduction in Associated Costs: Healthier employees take fewer sick days and have fewer mental health-related claims, potentially saving on healthcare premiums and other related expenses.
The investment of around $141,345 annually is financially sound, especially considering the potential return of $325,000 min, alongside the positive impact on workforce well-being and retention which enhances A2 Milk’s reputation as a forward-thinking employer.
(20min delay)