Disability Costs

Disability brings with it sizable human and financial costs to the employee, family, work group, organization and society in general. One widely-received estimate is that disability-related costs are 1% to 3% of payroll for the direct costs of short term disability, and 0.5% to 1.5% for the direct costs of long term disability. The indirect costs (worker replacement, re-training, etc.) are estimated to be one to five times that amount.



K. Nagel, "Total Organizational Health Costs: What Are They? What Can Organizations Do About Them?" (Presented at the Strategic Leadership Forum '99, Toronto, Ontario, 20 October 1999). B. Anderson, "Disability Management" (Seminar presented in Calgary, Alberta, 1990).