Should We Let Employers Decide Who Can Return to Work After Being Sick? Lessons from Belgium’s Reintegration Trajectories

Presenter

Marina Ligato (Université libre de Bruxelles)

Coauthors

Sébastien Fontenay and Ilan Tojerow

Abstract

This paper evaluates the impact of employer discretion in selecting participants for Reintegration Trajectories (RTs) among Disability Insurance (DI) recipients. These programs aim at promoting work-resumption through workplace adaptations and active employer involvement. Exploiting a 2018 policy change in Belgium that allowed employers to freely select participants, we use a Regression Discontinu ity Design (RDD) to estimate the causal effects of this discretion on employment outcomes. Employer-selected participants are 13.1 percentage points less likely to resume work and 19.7 percentage points more likely to remain in DI. We find that employers tend to select participants who are older and have longer durations of dis ability, resulting in reintegration trajectories that are often not initiated due to the inability of these individuals to start work adaptations. In contrast, an event study reveals that reintegration trajectories initiated by doctors significantly accelerate the work resumption process among disability insurance (DI) recipients