How Do You Measure Workplace Wellness?

It should come as no surprise that healthy employees boost a company’s bottom line. They experience less sick time, take fewer disability days and suffer lesser risk of premature deaths.

It is good business for companies to help provide employees with the information and tools that will empower them to adopt healthy behaviours.

Despite a growing understanding that happy and healthy employees equal a happy and healthy workplace, wellness programs are still often viewed as a nice extra, not a strategic imperative, and certainly not one that delivers ROI!

First, let me share with you some studies that were conducted on the return on investment (ROI) in wellness programs:

• Phase 1 findings from The Canadian Return on Investment Study determined that between 1.5 to 1.7 days per employee per year of absenteeism were saved with wellness programs, which translated into an estimated savings of $251 per employee per year (Statistics Canada stated that absenteeism rates ranged from 4.7 days to 11.2 days per employee per year.)
• Companies such as Canada Life, DuPont, Prudential Insurance and Citibank report a savings of $2 to $6.85 for each $1 invested
• Returns on healthy workplaces reported by large private sector organizations range from $1.81 to $6.15 for every $1 invested
• These findings were consistent with those found in a similar Harvard Business Review study:
  • The percentage of Johnson and Johnson employees who smoke has dropped by more than two-thirds.
  • High blood pressure declined by more than half.
  • The pay-off for Johnson and Johnson estimated by their leaders was a cumulative savings of $250 million on health-care costs over the past decade.
  • From 2002 to 2008, the return was $2.71 for every dollar spent. Based on the Harvard study, wellness initiatives save an employer an average of $394 per employee per year, while the programs only cost an average of $159 per employee per year — creating an ROI of $3.36 for every $1 spent.

As a result of Canadian studies with comparable tangible results, many insurance companies are offering percentage reductions in their group premiums for organizations that are committed to forge the world of wellness.

To create your own workplace wellness program with proven ROI, but without investing in a large-scale study, I have outlined below a few simple steps to follow for more effective measurement of your wellness programs:

1. Gather baseline information about the current status of your employees’ health. This can be done using a health risk assessment (HRA) which focuses on assessing health status, estimating the level of health risk and informing and providing feedback to participants to motivate behaviour change to reduce health risks.

1. Ensure you work with and incorporate an EAP Wellness Program with measureable services into your workplace wellness plans (seminars, programs, etc.) Identify desired outcomes for the program, based on the health information collected about employees.
2. Determine a realistic timeline for assessing whether desired outcomes have been achieved, including benchmark progress measurements. In other words, has your baseline data improved after one or two years?

There is no question healthy employees cost employers less in benefits, workers’ compensations claims and lost work days, and improve worker engagement. Armed with this, and strong new evidence that workplace wellness programs can indeed provide a significant return on investment, I hope you’ll be inspired to get involved in workplace wellness!

How important is having a measurable wellness program in your organization? Can you get “buy-in” without ROI? I look forward to an active discussion.