Absence, benefits ROI and employee financial resilience: The missing link
Employee absence is now an operational and financial challenge for employers, according to WTW’s Absence Management survey 2026.
Mental health remains a big driver, living costs are still rising and long-term absence is increasing. Yet many organisations still can’t reliably quantify its true cost.
That lack of clarity exposes a deeper issue: many employers aren’t sure their employee benefits are delivering the value they expect. Absence is forcing a fresh look at the benefits already in place and often, the benefits aren’t the problem. The problem is the value employers, and their employees, are actually getting from them.
The ROI problem in employee benefits
Historically, benefits were a “nice to have” but the economic environment has changed. Rising employment costs, tighter budgets and cost-of-living pressure mean HR teams are under far more scrutiny on benefits spend, and many can’t clearly demonstrate a return on investment (ROI).
Common signs of ROI issues: modest engagement, employees not truly appreciating what they have (in the context of their lives), low employee pension contributions, protection benefits like life assurance and income protection being barely recognised, and financial stress still driving absence and distraction at work.
What links absence and financial resilience
Financial wellbeing initiatives have helped get “money at work” on the agenda. Financial resilience is more practical: how employees cope when something goes wrong. Can they manage unexpected costs? Can they cope with a loss of income? Can they recover from a shock without their wellbeing or work performance suffering?
When employees lack resilience, employers feel it: more mental-health absence, more stress and presenteeism, more pay pressure, and higher turnover. Financial resilience isn’t just a wellbeing issue - it’s now a business risk and should be treated accordingly.
The opportunity hiding in plain sight
Many employers already pay for benefits that support resilience: group income protection, life assurance, pensions and healthcare. Yet employees often don’t understand how these protect them - some don’t even realise they have income protection.
The industry has sometimes focused too much on adding new benefits instead of unlocking value from the ones already available.
Why broker conversations have stalled
Budgets are tighter and new spend is hard to justify, so “new benefits” conversations have slowed over the last 12 months. That makes this the wrong time to buy more, however, it may be the perfect time to improve the ROI of what you already have.
Three key things employers can do without spending more:
- Communicate protection benefits properly: Most employees don’t understand life assurance or income protection. Start with the “why” in the context of their personal lives, not product features. Teach family financial protection and what “enough cover” looks like. When people understand the purpose, the benefit becomes meaningful.
- Improve pension engagement: Auto-enrolment solved participation, but not contribution levels. If most employees (80%+ is common) are only saving the scheme minimum, your communication isn’t working. Make pensions about employees’ future retirement income and lifestyle, not jargon.
- Build shock-absorbers: emergency savings and credit worthiness: Employees who can cope with unexpected costs are less likely to spiral into stress-related absence or distraction. Encourage emergency fund savings and explain why easy access to credit matters. This costs nothing, it’s education and motivation.
From wellbeing initiative to business strategy
Financial resilience is moving from a “nice to do” initiative to a business performance issue. When employees are financially fragile, stress rises, absence rises and productivity falls. When resilience improves, employers get a workforce that can cope with shocks without it spilling over into their work.
It starts with a different question: not “what new benefits should we add?”, but “are we getting the full value from the ones we already have?”
The case for a benefits diagnostic audit
A practical next step is a simple diagnostic audit of existing benefits (not a tender). Ask yourself the following:
- Do employees properly engage with and appreciate what they have?
- Do the benefits package actually support financial resilience?
- Is it reducing risk indicators like absence, stress and retention issues?
In many cases, that audit reveals the ROI gaps and shows employers that they already have most of the tools they need to strengthen resilience and take better control of absence. Some employee benefits experts will conduct this type of audit free of charge.
Supplied by REBA Associate Member, Secondsight
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