How can poor employee wellbeing cause a ripple effect in the workplace?

Healthy employees are the lifeblood of successful organisations. Other factors contribute, such as a workplace culture that is physically and psychologically safe, employment policies that are positive and progressive, jobs that are designed to match employee skills and needs, and processes that are clearly defined and empowering. But ultimately, an organisation cannot thrive in the long term if its people are not healthy and well.

Sadly, many employees in Australia are not well. This is costing organisations billions of dollars in combined absenteeism, presenteeism, workers’ compensation, and employee turnover - and threatening their long-term resilience.

But, these figures only tell a fraction of the story.

Poor wellbeing can affect not only an employee’s workforce participation and productivity, but that of their colleagues, managers, family members, and close friends - which represents a substantial hidden cost to organisations - on top of the direct costs of absenteeism, presenteeism, and workers’ compensation for the impacted worker.

This hidden cost is called the ripple effect and it’s the untold story of lost productivity that reveals the true workplace cost of poor employee wellbeing.

What is a ripple effect?

A ripple effect is where one single action or event causes a spreading effect or series of consequences. It is a common metaphor in social science literature “to describe how our actions (or non-actions) reverberate throughout the physical and social world”.

Its most common analogy is the dropping of a pebble into a pond, which triggers concentric ripples across the surface as it disturbs an increasingly larger portion of the ecosystem.

COVID-19 pandemic: an example of a ripple effect

Short-term ripple effects

• • >13.3 billion vaccinations

• • >649 million infections

• • >6.65 million deaths

• • Exhausted healthcare workforce, who have been “feeling [overworked and] pressured not to take sick leave or mental health days”

• • Unprecedented economic and psychological stress, due to border lockdowns, mandatory isolations, worker shortages, business closures, plane groundings, stretched healthcare funding, and catastrophic supply chain shortages. (Sources: Australian Bureau of Statistics, World Health Organization, United Nations, BMJ Open, Frontiers in Psychology)

Long-term ripple effects

• • >11 million girls may not go back to school after the COVID-19 crisis

• • Climate change investment redirected to pandemic causes

• • Cancer referral delays have reversed up to 8 years of improvements in survival rates

• • New risks have been created from exacerbations to inequality, mental health issues, age discrimination, lack of societal cohesion, a widening of the wealth gap, and rapid rollouts of new technologies (Sources: World Economic Forum, United Nations, Cancer Research UK, The British Medical Journal)

How can poor wellbeing cause a ripple effect in the workplace?

When an employee is healthy and happy, they are more likely to be motivated, collaborative, and productive at work. (Sources: Centers for Disease Control and Prevention, Society for Human Resource Management, The Wall Street Journal.)

Wellbeing “encompasses the health of the whole person - physical, mental, social and emotional” and “is most likely to flourish in a supportive and inclusive environment”. It is unique to each individual and the factors that cause one person to feel (and/or be) well or unwell might not have the same impact on another person - or at least not at that same point in time.

When an employee is not well, their poor wellbeing typically presents in the workplace as absenteeism, presenteeism, emotional contagion, and/or resignation.

What is emotional contagion?

According to researchers at Yale University, emotional contagion is the phenomenon where one group member’s mood can ripple out to affect other group members’ emotions, group dynamics, and individual thinking, attitudes, and behaviours.

Poor wellbeing could be due to a medical, mental health, social, emotional, safety, financial, and/or other concern. It is often due to a complex set of multiple intertwined concerns that can make a person feel down, sad, tired, ill, distracted, disconnected, unmotivated, negative, and unable to work to their full capacity - or worse, unable to work at all.

Poor employee wellbeing can cause a ripple effect in the workplace because it can reduce not only the productivity of one employee but many employees.

Why does poor employee wellbeing affect multiple workplaces?

This article is the first in a series of four articles related to the ripple effect of poor employee wellbeing.

Our second article will address the question of why poor employee wellbeing can affect multiple workplaces. That article will cover:

• • Primary workplace

    • • Direct colleagues
    • • Indirect colleagues
    • • Managers
    • • The organisation

• • Secondary workplace

    • • Direct colleagues
    • • Indirect colleagues
    • • Managers
    • • The organisation

• • Case study: Luke

What is the ripple effect costing organisations?

The third article in the series will be an in-depth dive into what the ripple effect is costing organisations. That article will cover:

• • Direct costs

• • Indirect costs

• • Wage multipliers

• • Case study: Nadira

How can organisations minimise the ripple effect of poor employee wellbeing?

The final article in the series will suggest some next steps for organisational leaders. That article will cover:

• • Improving the wellbeing of employees

    • • Cultivating a culture of wellbeing
    • • Creating a safe and healthy workplace
    • • Implementing meaningful support systems

• • Improving the wellbeing of family and close friends

    • • Broadening social initiatives
    • • Extending meaningful support

Download our new report

If you’d like access to all of this content faster, we invite you to download our new evidence-backed report. It aims to help you:

• • Understand the ripple effect of poor employee wellbeing

• • See the ripple effect in action

• • Calculate the hidden cost of lost productivity

• • Minimise the impact on your organisation

Want to learn more?

For more information about how Sonder can help you rethink your employee and/or student support, we invite you to contact us here.