Can compulsory dialogues nudge sick-listed workers back to work? (Markussen et al. 2015)
Markussen, S., Røed, K., & Schreiner, R. C. (2015). Can compulsory dialogues nudge sick-listed workers back to work? (IZA Discussion Paper No. 9090). Bonn, Germany: Institute for the Study of Labor (IZA).
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- The study’s objective was to examine the impact of a compulsory dialogue meeting (DM) on the return to partial or full-time employment for long-term sick-listed workers in Norway.
- The authors compared differences in outcomes between long-term sick-listed workers whose absence started in July 2004 through June 2006 and those whose absence started in January 2009 through December 2010, during which time the DM program became compulsory. The authors used salary and social insurance data from the Norwegian Social Security Administration (SSA) to measure program impacts.
- The study found that increasing the probability of a sick-listed worker attending a DM resulted in a significant increase in base salary, for those who returned to full-time employment, of $1,436. It also resulted in a significantly lower probability of receiving temporary disability benefits two years later for those who returned to full-time employment (1.4 percent) and those who returned to either part- or full-time employment (2.3 percent).
- The quality of causal evidence presented in this report is low because the authors did not establish the comparability of the treatment and comparison groups. This means we are not confident that the estimated effects are attributable to compulsory DMs; other factors are likely to have contributed.
Features of Dialogue Meeting (DM)
Workers in Norway who go on long-term sick leave are paid their base salary for the first year of their absence. The employer covers the salary for the first 16 days, and the Norwegian SSA provides coverage for the remainder of the year. Approximately 6 months (26 weeks) into the absence, the SSA organizes a compulsory DM between the worker, the employer, and if necessary, the physician who authorized the sick leave. During this meeting, the parties discuss whether arrangements can be made at the workplace to facilitate the worker’s full or partial return to work.
Features of the Study
Because of differences in the operations of local SSA offices, the timing of the DMs and issuing of exemptions from them varied across counties, such that some sick-listed workers were not invited to a DM during the first 52 weeks of their absence. The authors incorporated this local variation into their design to estimate the probability that a sick-listed worker attended a DM. Specifically, the authors modeled the effect of a change in the probability of attending a DM on earnings and insurance receipt, moving from the lowest to highest average probabilities observed across counties.
Long-term earnings and social insurance receipt were measured two years after the beginning of an individual’s spell of absence. Long-term sick-listed workers who began a spell of full-time absence in July 2004 through June 2006 were compared to those beginning spells in January 2009 through December 2010, during which time DMs became compulsory. In both periods, workers with absence spells lasting long enough to lead to an invitation to a DM were compared to those with shorter spells who were not likely to experience a DM. The impacts that the authors estimated can be interpreted as a comparison of the difference in outcomes before and after the introduction of compulsory DMs for those with long spells (and likely to be affected by the policy) relative to those with short spells (and not likely to be affected by the policy) across counties with varying probabilities of inviting sick-listed workers to a DM.
The study included 129,656 and 151,911 individuals from the non-compulsory and compulsory DM periods, respectively, across all 19 counties in Norway. Approximately 60 percent of long-term sick-listed workers were women, with an average age of 44 and a base salary of $29,000. On average, workers were absent for a period of 40 weeks.
- The study found that an increase in the probability of a sick-listed worker attending a DM, from the lowest county-level probability to the highest county-level probability, resulted in a significant increase ($1,436) in base salary for those who returned to full-time employment.
- An increase in the probability of attending a DM from the lowest county-level probability to the highest county-level probability resulted in a significant decrease in the probability of receiving temporary disability benefits two years later by 1.4 percent for those who returned to full-time employment, and 2.3 percent for those who returned to either part-time or full-time employment.
Considerations for Interpreting the Findings
The authors controlled for differences between the treatment and comparison groups in many individual demographic and employment characteristics. However, they did not show equivalent trends in baseline earnings or benefit receipt outcomes between groups before the compulsory DMs came into effect. This is important because, among other things, the introduction of compulsory DMs could have led workers to change the timing and length of their absences from work, introducing systematic differences in earnings or benefit receipt between the treatment and comparison groups. Workers might have extended their absences to receive the treatment, making them systematically different from those in the comparison group with short spells. This means that the estimated impacts may reflect differences between the groups in addition to the effect of compulsory DMs.
Causal Evidence Rating
The quality of causal evidence presented in this report is low because the authors did not establish the comparability of the treatment and comparison groups. This means we are not confident that the estimated effects are attributable to compulsory DMs; other factors are likely to have contributed.