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Calculation Details and References
1. Absenteeism Cost
Absenteeism refers to employees missing work due to health issues, including mental health. The cost of absenteeism per person is $825.
Source: Safe Work NSW (2017). Mentally healthy workplaces in NSW: A return on investment study.
Calculation: Total Absenteeism Cost = Absenteeism Cost Per Person * Number of Employees
2. Presenteeism Cost
Presenteeism is when employees are physically present at work but are not fully productive due to health issues. The cost of presenteeism per person is $1,680.
Source: Safe Work NSW (2017). Mentally healthy workplaces in NSW: A return on investment study.
Calculation: Total Presenteeism Cost = Presenteeism Cost Per Person * Number of Employees
3. Turnover Cost Due to Mental Health Issues
Turnover rate due to mental health issues is 9.5%, with 40% of turnover being directly related to mental health issues. The direct and indirect costs of turnover are estimated to be 33% of the annual salary.
Source: ABS Job Mobility June 2023; Hoel, H., Sparks, K., & Cooper, C. (2001), L Carter and J Stanford May 2021, Investing in Better Mental Health in Australian Workplaces; Victoria State Government 2023.
Calculation: Total Turnover Cost = Average Annual Income * Number of Employees * Turnover Rate Due to MH * Turnover Cost Percentage of Annual Salary
4. Total Cost to Organization
This is the sum of absenteeism, presenteeism, and turnover costs due to mental health issues.
Calculation: Total Cost to Organization = Total Absenteeism Cost + Total Presenteeism Cost + Total Turnover Cost
5. Organisation Savings
This represents the potential savings an organization could achieve by improving mental health policies. It's based on a given percentage improvement, with research suggesting businesses with proactive mental health policies experience 70% fewer safety incidents.
Source: Gallup 2016 Q12 Meta Analysis.
Calculation: Organisation Savings = Total Cost to Organization * Percentage Improvement
6. Number of Employees Affected by Mental Health Issues
It is estimated that 41% of employees experience poor mental health caused by work.
Source: BITC, Mental Health at Work, 2020.
Calculation: Employees Affected by MH Issues = Number of Employees * Percentage of Employees Experiencing Poor MH Due to Work
Additional References:
- Average annual income including superannuation = $1,838 per week plus Superannuation. Source: ABS May 2023.
- Mental health claims are set to double by 2030. Source: CEDA - Mental health and the workplace 2022.
- Key work health and safety statistics Australia 2022. Source: Safe Work Australia 2022.
