Keeping disabled employees at work boosts group benefit schemes

24 February 2011 Anton Engelbrecht, Business Development and Strategic Consultant, Alexander Forbes Health

People with disabilities experience high unemployment and often remain in low status jobs. Yet there is a lot that companies can do to accommodate disabled employees, benefit from their skills and abilities and meet legislative targets. What is not so widely known, however, is how much money organisations can save on their group benefit schemes by retraining or redeploying disabled staff instead of boarding them.

The numbers speak for themselves.

Boarding a 43 year old male with a monthly salary of R8494 costs the company’s group benefit scheme R1.3 million. So, “successfully retraining the same employee, and others like him, into a suitable alternative occupation will save the company scheme approximately R1.3 million per case” says Anton Engelbrecht, Business Development and Strategic Consultant, Alexander Forbes Health.

Yet, instead of effectively managing the disability process, employers rush to settle cases within the legislated period, handing disabled employees over to their insurers for income replacement benefits or the payment of a lump sum.

While this reduces red tape and simplifies the processes for employers, in the long run it costs more. It is also, in many cases, a violation of Schedule 8 of the Labour Relations Act (LRA) which requires an employer to investigate an employees’ medical incapacity prior to termination of employment - with the express intention of “retaining the employee in his or her occupation, or even a different occupation, as far as reasonably possible” says Engelbrecht.

In fact the Code of Best Practice of Key Aspects of Disability in the Workplace issued by the Department of Labour provides a guideline for employers, employees and their representatives to develop, implement and refine disability equity policies and programmes to suit the needs of their respective workplaces.

While the intention of the legislation is that such practice becomes internalised within organisations, “the truth is that human resources skill, practice and capacity in many South African organisations is insufficient to manage this process within the tight deadlines imposed by legislation” says Engelbrecht.

An alternative is to outsource the design of an organisation’s disability management strategy. This will not only enable the strategy to meet legislative requirements while assisting employers become an employer of choice, it will also retain skills while saving the group benefit scheme millions.

At minimum, such a strategy should:

  • Ensure that all human resources policies comply with relevant legislation, i.e. the Employment Equity Act. The Labour Relations Act and the Code of Best Practice.
  • Provide a disabled-friendly environment that is both physically accessible and socially and professionally accommodative.
  • Drive to recruit and select suitable disabled candidates for all vacancies while rehabilitating and re-training employees who become disabled while in the employ of an organization.
  • Ensure the provision of further training and career advancement opportunities for persons with disabilities.

Apart from being the right thing to do, getting this process right “sees a reduction in the costs of disability claims on group benefit schemes and ensures legislative compliance while retaining skills within the business” concludes Engelbrecht.

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