Does part-time sick leave help individuals with mental disorders recover lost work capacity?

This paper aims to answer the question whether combining sick leave with some hours of work can help employees diagnosed with a mental disorder (MD) increase their probability of returning to work. Given the available data, this paper analyzes the impact of part-time sick leave (PTSL) on the probability of fully recovering lost work capacity for employees diagnosed with an MD.

The effects of PTSL on the probability of fully recovering lost work capacity are estimated by a discrete choice one-factor model using data on a nationally representative sample extracted from the register of the National Agency of Social Insurance in Sweden and supplemented with information from questionnaires. All individuals in the sample were 20-64 years old and started a sickness spell of at least 15 days between 1 and 16 February 2001. We selected all employed individuals diagnosed with an MD, with a final sample of 629 individuals.

The results show that PTSL is associated with a low likelihood of full recovery, yet the timing of the assignment is important. PTSL's effect is relatively low (0.015) when it is assigned in the beginning of the spell but relatively high (0.387), and statistically significant, when assigned after 60 days of full-time sick leave (FTSL). This suggests efficiency improvements from assigning employees with an MD diagnosis, when possible, to PTSL.

The employment gains will be enhanced if employees with an MD diagnosis are encouraged to return to work part-time after 60 days or more of FTSL.