Absence Management – Outsourcing Trend

There is an increasing trend among Australian organisations implementing an outsourced absence management program. This trend is due to the high levels of absenteeism in Australia, the effort and time it takes to minimize its impact, and limitations in internal capabilities and systems.

Recent organisational surveys in Canada and the US reveal that close to 15% of organisations have outsourced absence management, and a further 7% intend to do so in the next 12 months. It is trend that is likely to continue to accelerate in the coming years.

Rather than see it as outsourcing a problem, HR see it as implementing a better approach to managing an important human resource issue. Absence management is complex and hard to deal with, and specialist providers have developed unique and powerful capabilities to simplify management and get control of absence fast.

Business leaders are acutely aware of the cost of absenteeism. You can download a free cost calculator here.  It is important to run the ruler over true underlying cost of absenteeism –both direct sick pay and indirect costs such as excess headcount to cover leave, overtime, labour hire and management distraction.

Absenteeism also has a significant impact on employees, impacting morale, workload, stress and mental health, not to mention lost wages and financial burdens. In workplaces that need to replace labour, the risk of health, safety and quality issues increase and management workload is increased, diverting leaders from their core functions.

Outsourcing can deliver many benefits to different stakeholders. When deciding to outsource absence recording it is important to clearly articulate the program benefits to senior stakeholders, front line leaders and employees.

For managers, it will free up time, reduce admin, and provide a simplified system to manage employee absence. For employees, it can deliver 24×7 medical advice and referral to other health services you provide – like an EAP for health. For HR, developing a centralised reporting process provides a consistent process across the organisastion, and real-time absence analytics across the organisation.

DHS introduced Day 1 absence program s to Australia 12 years ago, and is the leader in this space. DHS is the only provider to offer a Nurse led, 24×7 Absence Program underpinned by leading edge technology. The program can be broken down into the following key areas:


  1. DHS handle initial absence calls from employees who are ringing in sick or for Carers Leave. These calls are handled by trained nurses skilled in providing health advice over the phone for employees and their family members.
  2. Managers receive real-time alerts through the system, and trigger alerts if employees are exceeding levels of absence, or have an absence pattern.
  3. When employees return to work, the program ensures that managers have back to work discussions with the employees, and HR have reporting to monitor that this is occurring…. or not.
  4. HR and executive leaders receive management level reporting which identify hotspots, trends and causes to take action.


One of the common things holding companies back from outsourcing absence management is concern that it is outsourcing a problem which is really a manager’s job. Executives will want to understand what impact outsourcing the initial Absence Notification may have on the employee-manager relationship, and how the system will actually improve manager-employee communication.

“I hear this concern quite frequently from HR & Operations managers. By centralising the initial notification of absence, employee calls are handled with care and consistency, and absence information is recorded in a management system in real-time. What our platform ensures is that managers have a conversation with employees when they have returned to work, and address absence issues, rather than ignore them. The program increases management accountability and we help them develop the skills to do so.”

Companies who partner with DHS do not outsource their problem…. they leverage our unique capabilities to support their managers to manage absence better and more efficiently.

“On one hand, Triage Nurses support employees who are unwell with the highest quality health advice, and deter illegitimate absence…. On the other hand, managers finally have access to great absence management information in real-time, with easy to follow workflows.”


Direct Health Solutions is Australia’s Leading Nurse Led Absence Management Provider, with clients across all industry sectors. We enable our clients to reduce absence by 25%- 40%. Contact us for a brochure or no obligation discussion and to learn what industry specific programs we have developed.