How to Calculate (and Prove) the ROI of Employee Wellness Programmes
- Canute Fernandes
- May 6
- 2 min read
Introduction
In an era of tight budgets and higher C-suite scrutiny, wellness initiatives must prove their business value, not just their good intentions. Fortunately, robust data shows wellness investments do deliver hard ROI — if measured correctly. Here's your step-by-step guide to calculating the financial return, impressing your CFO, and securing next year’s budget.
The Business Case for Employee Wellness ROI
📊 A Harvard meta-analysis reveals that every $1 invested in workplace wellness yields $3.27 in reduced healthcare costs and $2.73 in reduced absenteeism.(Source: PubMed, meta-analysis of corporate wellness outcomes.)
When framed in dollars and cents — not just softer benefits — wellness becomes a bottom-line asset.
Step-by-Step Worksheet: Calculate Your Wellness ROI
1. Identify Cost Buckets
Start by categorizing all direct and indirect costs:
Programme costs (platform fees, health screenings, events)
Communication and incentives
Administrative overhead
Action Tip: Include both internal labour and external vendor costs for full transparency.
2. Gather Baseline Claims and Absenteeism Data
You’ll need 12–24 months of historical data for:
Health insurance claims
Sick-leave days
Short-term disability claims
Action Tip: Work with your insurance broker or TPA (Third Party Administrator) to pull de-identified data.
3. Apply the Absenteeism Multiplier
According to SHRM, each day of unplanned absence costs employers 1.2x to 1.4x the employee's daily salary due to lost productivity and coverage gaps.
Formula:
Total Absenteeism Cost = (Average Daily Salary) x (1.3 Multiplier) x (Total Sick Days)
4. Build Your ROI Dashboard
Combine the data into a simple dashboard to show pre/post differences:
Metric | Baseline | 6 Months Post-Wellness Launch | % Change |
Health Claims per Employee | ₹12,000 | ₹10,300 | ↓14.2% |
Sick Days per Employee | 4.2 | 3.6 | ↓14.3% |
Programme Cost per Employee | ₹2,000 | ₹2,000 | No Change |
Example Insight: For every ₹2,000 invested, ₹4,000+ in healthcare and absenteeism costs were avoided.
Case Study Spotlight: Anonymous LifeUno Client
After launching a LifeUno wellness programme, one mid-sized tech firm saw:
14% reduction in average sick days within six months.
8% decrease in insurance premium negotiations at annual renewal.
"Wellness became a line item that paid for itself — and then some." — HR Director, Anonymous Client.
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