Rising sickness rates and higher employment have pushed German employers' spending on ill employees to around €82 billion ($96 billion) in 2024, up €10 billion in three years, according to the Cologne-based German Economic Institute (IW).
Jochen Pimpertz, a tax and social policy expert at the employer-affiliated IW, highlighted proposals to limit these costs. One option would be "waiting days," during which salary payments are suspended for the first few days of illness.
Alternatively, pay could continue at a reduced level for an initial period. Another suggestion involves shortening the duration of continued salary payments.
Currently, employers pay wages for up to six weeks per year, with extensions allowed if a new illness arises. Under proposed changes, this limit could apply across different diagnoses, effectively capping annual payments at six weeks.
Since 2010, total employer spending on sick employees has more than doubled, the study found. The IW combined direct wage continuation, estimated at €69.1 billion for 2024, with employer social security contributions of €13 billion. Payments during maternity leave were not included.
Under current law, employers must continue paying wages when workers are sick before statutory health insurance takes over with sickness benefits.
Long-term sick employees can receive 70% of gross pay up to the 72nd week. Last year, employer costs exceeded sickness benefit payouts by a factor of four, the IW noted.
The increase is attributed to rising wages, higher employment, and steadily growing sickness rates over the past two decades. Pimpertz added that these absences are likely linked to the ageing workforce.
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