Occupational health is the focus of two new consultations from the UK Department for Work and Pensions (DWP) and from HM Treasury (the Treasury) and HMRC. The consultations should, according to their authors, be read together. Both consultations close to responses on 12 October 2023.

According to the World Health Organisation, Occupational Health (OH) is "an area of work in public health to promote and maintain the highest degree of physical, mental and social well-being of workers in all occupations". OH teams seek to address and mitigate against potential risks in the workplace that could lead to work-related ill-health.

Occupational health: working better

The DWP's consultation on OH provision (the DWP Consultation) notes that only 45% of workers in Great Britain have access to OH services. By focusing on the role of government, OH providers and employers, it is hoped that there will be an increase in OH coverage. This, in turn, would enable better support in the workplace to improve productivity and prevent ill-health-related job loss.

As part of its voluntary proposals (covered in Chapter One), the DWP Consultation proposes a national "health at work" standard. It is suggested that this standard, together with other proposals such as consolidating the available guidance for employers, offering accreditation and sharing of best practices, will help to create an embedded, simple and clear baseline for quality OH provision. 

Chapter 2 looks at practical examples of where OH provision is already effective. This includes steps taken by other countries in the form of legislation, as well as case studies from UK-based employers.

The final chapter of the DWP Consultation, which relates only to England, seeks views on proposals to enhance current OH offering capabilities and to develop a multi-disciplinary OH workforce in collaboration with the private sector. It notes that, in order to fulfil the proposals set out in the consultation, the workforce and delivery models "need to evolve to meet increased demand".

Joint Treasury/HMRC consultation on tax incentives for occupational health

On 20 July 2023 (the same day as the launch of the DWP Consultation), HMRC and the Treasury launched a consultation on using the tax system to encourage and support employers to increase their OH provision (the Treasury/HMRC Consultation). 

The proposals would involve expanding the Benefit in Kind Exemption (the Exemption) for income tax and National Insurance Contributions. The Treasury/HMRC Consultation also seeks views on whether other tax incentives would be more effective. 

In particular, the Treasury/HMRC Consultation proposes that the following treatments should remain in scope of the Exemption:

• recommended medical treatment funded by an employer to help employees return to work;
• cost of annual health screening and medical check-ups;
• welfare counselling; and 
• eye tests and glasses or contact lenses.

The scope of the Exemption would be extended to include:

• health screenings for employees, within a specific pre-defined limit;
• medical check-ups for employees, within a specific pre-defined limit;
• treatments that aim to reduce workplace absence or enable employees to perform better, including preventative treatments; and
• flu vaccinations, where paid for by the employee and later reimbursed by the employer.

However, there is no proposal to extend the Exemption to other provisions such as private medical insurance for employees, non-clinical treatments (e.g. wellness retreats, fitness classes or gym memberships), wages of OH staff, consulting costs or costs relating to non-employees such as family members of employees.

A third, separate consultation was also launched on 18 July 2023 by the Disability Unit and Equality Hub on the proposed 2023 to 2024 Disability Action Plan. This refers to both of the consultations mentioned above.

According to the Office of National Statistics, the sickness absence rate – the percentage of working hours lost because of sickness or injury – rose to 2.6% in 2022, an increase of 0.4% from 2021 and the highest it has been since 2004, when it was 2.7%. One can only hope that improved OH provision will assist in stemming this tide. Employers may wish to consider proactively reviewing whether they can use OH services to improve employee health and productivity, regardless of the outcomes of the consultations. Preventative measures can prove more cost-effective in the long run, with a healthy workforce contributing to a healthy bottom line.

If you have any questions on the points raised in the consultations or other points related to OH provision, please do not hesitate to get in touch with a member of the Dentons team.