Nine Ways to Reduce Absenteeism

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Nine ways to reduce absenteeismArticles

Does your business suffer from absenteeism? Absenteeism weakens businesses and reduces profits.

The cost of absenteeism is difficult to quantify. In the US, has been calculated the direct wage losses totalledmore than $30 billion per year. However, there are many other losses which are incurred directly as a result ofabsenteeism.

Some of these losses include:

o

Regular wages, overtime wages, and company benefits.o Administration of recruitment, selection, induction, and training.

o The potential loss of customers because of delays in delivery.

The less tangible costs are just as damaging to the business. When a team member is absent the discretionaryeffort of the remainder of the team is diminished. In turn, productivity falls, job stress rises, team spirit is reducedand there is additional administration and overheads. All these contribute to the erosion of profits.

Two tactics that are commonly used and don't work.

1. Shouting. There is no point of shouting at a member of staff to change their attendance record. This is like trying tosteer your car using the horn!

2. Punishment. There are many ways of applying punishment to work. Giving people unpopular jobs, reducing

overtime, constant criticism, restricting the employee from doing popular jobs, ignoring them and giving them the lastpick of weeks for holidays. None of these work.

The silver bullet for dealing with the absenteeism problem.

There is no silver bullet! In other words, there isn't one method of dealing with absenteeism and it works best forall businesses. Strategies and tactics that work well for medical workers, may be totally ineffective for carassemblers.

Give Your Leaders the Right Tools for the Job.

There are some basic rules for designing your own effective absentee program. It is all to do with giving peoplein leadership positions the right tools. If they don't have the right tools they will have very little influence.

Basic Rules

1. Let your staff know what level attendance is expected of them and what the consequences are if they meet theexpectations and the consequences if they fail to meet the expectations.

2. Measure and track absenteeism and record the performance in graph form which is posted in a public area.

3. Give feedback on attendance by discussing absenteeism with the staff on a regular basis.

4. Helpemployees maintain or improve their attendance records by discussing their reasons for not attending work andoffering some solutions.

5. Carefully match people to jobs. Motivated members of staff normally have good attendance records.

6. Recognise good attendance performance by having regular meetings with your staff and making sure that attendance isa regular agenda item.

7. Let them know straight away when they are not meeting the agreed on attendance performance levels.

8. Train supervisors to support the absentee program and contribute to it.

9. Make sure that there is a clear objective that is shared among all staff and that they agree it is achievable.
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10. Fine-tune the absentee program to meet operational needs so that it will evolve into a more valuable program thatgives you watch you want.

Creating better attendance performance.

Here are some of the things that you can do to improve attendance records. I have put them in the form of 9questions which you can tick off if you are consistently applying them.

o When staff call in absent, do they talk to you personally?

o Do you counsel staff if their attendance record starts to worsen?

o Do you make a note of every absence and graph it?

o Do you have an attendance policy and do your staff sign it when they start work with you?

o Do you apply your absenteeism strategies consistently?

o Do you have a limit in your attendance policy after which you will ask for medical certificates for every subsequentabsence?

o Do you discuss attendance records and absences during your team talks with your staff?

o Do you interview your staff after every single absence?

o Do you give positive feedback for good attendance records?

How to Reduce AbsenteeismAuthor: Jeff Durham - Updated: 25 June 2010| Comment

Whilst most workers are only absent from work for genuine reasons such as injury or sickness,

every company has problems with people who take time off work for no particular valid reason,

although theyll almost always come up with a legitimate valid excuse (even if theyre lying).

A high level of absenteeism is not only extremely costly to employers but it can add to the burden

of the rest of the staff and lower morale. A vast amount of research has been undertaken over

the years looking into the reasons for absenteeism and, when researchers have scratched

beneath the surface a little more, the predominant reason that people tend to take time off work

is because ofHigh Stress Levels. That said, its rare for an employee to state stress as the

reason theyre unable to work. And, although genuine stress is very real in its severest forms,
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many people would possibly perceive it as a weakness if they were to own up to feeling stressed,

so they simply cover that up with an often less convincing excuse.

Stress

The reasons people get stressed out because of work can be many and varied. However, the

more common reasons cited have tended to be related to employers and supervisors who are

very authoritarian and inflexible. They often dont listen to the workers, do not communicate very

well, adopt a blame culture when things go wrong, speak down to workers and generally want

things done their way or no way at all. This can all result in a high staff turnover, increased

absenteeism, Low Staff Morale, employee burnout and genuine illnesses such as headaches

and backaches brought on by the stress so, even though workers will usually give another

reason for their absence, some kind of stress-related problem will usually be at the root of it.

Related on Safe Work ers...

Job Interview: Questions That Should Not Be Asked

Team building and Employee Wellbeing

Fitting in With the Team

Changing the Working Environment and CultureOne of the best ways of reducing staff absenteeism is by changing the environment in which the

company operates. This can be done at a very basic level in terms of improving the conditions

within offices and buildings. Modern equipment, climate controlled buildings and good work

facilities are all beneficial as nobody likes to come to work to be sat or standing in a ramshackle

office or factory. It goes far deeper than that though.

Employers should be encouraged to get rid of any them and us culture within the workplace andadopt open communication policies where both workers and supervisors (or the boss) can meet

regularly to discuss any issues and to consider any suggestions for improvement.

Its not only relationships with superiors that cause a problem. Often, a person will take time off

work because ofProblems With a Colleague. This might not be something where they could

seek action by addressing it as a work legislation issue so they might not know who to turn to

and simply go absent for a while. Employers should adopt policies which apply to all their staff

which foster mutual respect between all workers and between workers and management. In

addressing all of the above issues firstly, its most likely that a company will experience less

absenteeism as a result.

Offering IncentivesIn offering incentives to employees in an effort to reduce absenteeism, its crucial that theyre

structured in such a way so as not to be seen as an additional reward for coming to work as

theyre paid to be there after all. However, things like cashing in unused sick days or allowing an

employee to leave work at lunchtime on the last Friday of the month if theyve had a perfect

attendance over the preceding month are a couple of ways which can help to reduce

absenteeism.

An Attendance Policy

What is certain is that a company cant adopt a haphazard approach to the areas of attendanceand absenteeism and there should be a firm policy in place describing how absenteeism is dealt
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with and this should be incorporated into the staff handbook or employment contract of each and

every worker. Things like return to work interviews with a manager after X amount of days

absence or after so many occurrences of absence within a fixed period should be made

mandatory. This strategy should not be in place to punish people but should be viewed as an

opportunity for both worker and employer to hold an open discussion about the workers absence

and to establish if there is anything an employer can do to improve the situation.

Of course, there will be some people who are just simply work-shy and so a well-managed

attendance policy will weed out those who do not have a genuine reason for repeated

absenteeism. In these cases, the policy should also state any disciplinary measures the

company will take in the case of illegitimate absence from work including firing the employee if

the situation doesnt improve. However, employers need to be very careful with regard to taking

radical action like this and should consult all of the relevant laws regarding the legitimate

dismissal of an employee first of all. However, as long as they comply with the relevant

legislation, the last resort of getting rid of an employee can be the ultimate outcome.

Tips to Reduce Absenteeism into Minimum94

Byfianita

Practical Guideline for Controlling Unauthorized Absence

There are many theories to explain of absence causes. And it make us realize, we can not solve

causal absence problem and control absenteeism as minimum as we could, with simply method.

We need comprehensive approach to reducing absenteeism issue. Here some practical method

explained :

1. Make your absences policy work out. You have to apply other system to make sure your

absenteeism rule and regulation implemented well to all employee. Such as :
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Put absenteeism rate as a standard objective to work towards. Its not enough if you just

make a statement such as, "reducing absence into minimum". Put them as part of the

performance appraisal system and give a target with number. Of course, you still have to

give tolerance for them for getting sick, having babies or in crisis situation. With those

consideration, you can give absence rate such as 3.5%

Train managers about cost of absenteeism, how to control it and how to conductingcounseling session with their subordinate.

Make additional regulation to reduce pay on their absence day and communicate to them

how much that they have lost money. It will prevent them to extend their absence any

longer that necessary. But you have to check the local legal regulation and policy before

apply this method.

Make system to records the employee absence. Someday you will need it to find absence

pattern, unreasonable absence excuse or anything else as strong facts for give

consequences or legal actions.

Give appreciation to the attendance. You can make simple celebration just to pronouncewho the best employee in attendance. Let all member of the team to choose the winner.

Create social punishment to the absenteeism. You can make it by giving reward for team

who has excellent member attendance. It will make other member give pressure to

employee who has bad attendance record.

Make absence policy align with other policy, especially for policy related to the employee

benefit. Such as you can make regulation to do not give loan for anyone with poor

attendance.

2. Make sure your recruitment and selection procedure consider absence issue, such as :

The recruiter should put medical and health condition of candidate as one of priority.

Make sure that candidate has positive attitude about attendance importance

Its very important to count not only competency fit, but you have to consider job fit. Its

include the compatibility of candidate interest and personality with nature of the job. If there

is no chemistry, there is no motivation also. Employee with low motivation to work tend to

high in absenteeism rate.

3. Since some absenteeism are related to the job problem, you can use some method to identify

the core problem as I describe in my former writing about How to Handle Poor Performer, before

you apply some solutions. But here some additional guideline to be considered :

Make flexible working time arrangement. Such as, if employee can not go on Monday for

domestic demands, they can replace them with Saturday. Or if he/she attend half day,

he/she can substitute it with additional working hours tomorrow

Make job interesting. You can enlarge responsibility, enhance the nature of job or make it

challenging to your subordinate. Don't forget to give additional support such as training and

coaching.


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The Causes of Absenteeism

The causes of absenteeism may include:

serious accidents and illnesslow moralepoor working conditionsboredom on the joblack of job satisfactioninadequate leadership and poor supervisionpersonal problems (financial, marital, substance abuse, child care etc.)poor physical fitnesstransportation problemsthe existence of income protection plans (collective agreement )benefits which continue income during periods of illness or accident.)stressworkloademployee discontent with the work environment

Most if not all of these causes can be prevented by taking a positive approach to things. By

showing the employees that you care, you can help lower absenteeism in the work place.

Preventing

You can use these training materials to help teach your supervisors:

What you can do to prevent absenteeism-related problems:

Adopting a systematic approach.Creating and coordinating project team.Administering clear tasks and responsibilities.Ensuring the support of senior and line management.Involving employees actively.Involving thepersonnel department, company medical service or externalguidance.

There are many cost associated wit absenteeism thatemployees would notexpect.

Cost to the Employer


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Administrative costs associated with rescheduling staff or hiring staff.

Payroll costs for temporary staff.

Training costs associated with introducing temporary staff to theorganisation.

Reduced productivity - managers may have to shut down departments orreduce operations to compensate for a reduction in staffing levels.

Overtime may have to be scheduled to fill positions left by absent staff.

Added cost of training supervisors in the cost of absenteeism.

Many organization average the total number of absent days and scheduleextra staff to cover - overstaffing to compensate for the lost productivity.

Insurance claims and legal fees associated with absent employees as aresult of an accident at work.

Cost of time - how much does it cost the company every time an employeeis away from their desk due to dentist / doctor appointments.

Costs associated with statutory sick pay and the increasing administrative

work faced by payroll drive up costs.What is absenteeism?

Absenteeism, as the term suggests, simply means failing to show up for work when you arescheduled to be there. The effects of absenteeism are directly proportional to decreasedproductivity. The company, eventually, is at a loss trying to cover up the indirect cost involved tohire temporary staff, and pay employees for overtime.

As absenteeism is a fast emerging problem across the globe, it's a challenge to come up withsolutions on how to reduce it. Before we discuss the solutions to this problem, let us delve into itscauses.

Causes

Personal Factors

1. Personal Attitude: The attitude one carries to work says a lot about the person. Employees

with strong ethics will respect their work and appreciate the contribution they make to

their companies. Such employees will not engage themselves in taking unscheduled off.

On the other hand, employees with very low or no work ethics are undisciplined and have

a lot of integrity and behavioral issues. Since, they feel no obligation towards the

company, absenteeism comes easily to them.

2. Age: The younger employees are often restless. They want to spend time with their friends

and have fun, rather than being tied down with work responsibility. This lack of ownershipoften leads them to take unauthorized time off. With age, people gain experience and


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maturity, which makes them focused and responsible. Their approach is rather professional

and they prefer to stick to their chairs to get the work done. If ever they are found absent,

then it could be due to sickness.

3. Seniority: Employees, who have been with the company for a long time are well-adjusted

with the working culture and the job, therefore, they find no reason to be absent without

permission. On the other hand, new hires are more prone to taking ad hoc breaks tounwind themselves.

4. Gender: Women generally do a balancing act by shuffling their time between home and

work. Family, being their foremost priority, they don't think twice before taking a step day

off.

Workplace Factors

1. Stress: The pressure at work sometimes takes a toll on the employees. This results in

increased levels of stress. The employees then resort to excuses that can help them stay

away from work.

2. Work Routine: Doing the same job over a period of time can get monotonous. Theemployees find the job functions boring. They choose to do something interesting rather

than come to work.

3. Job Satisfaction: If employees do not find their job challenging, dissatisfaction creeps in.

That leads to more absenteeism.

It is essential to measure absenteeism, as it is important to identify the trends and trace thepatterns in an employee's attendance. There are two methods to measure absenteeism. Careshould be taken to see that the data collected for measuring absenteeism is accurate. The mostpopular method is the "lost time rate" formula.

Lost Time Rate = (Number of Working Days Lost/Total Number of Working Days)*100

The other formula is the "individual frequency" formula.

Individual Frequency = (Number of Absent Employees/Average Number of Employees)*100

Dealing with Absenteeism in the Workplace

1. Design a comprehensive leave policy that is in alignment with the company's values and

objectives.

2. The workplace communication, while dealing with sensitive issues like absenteeism should

be clear and transparent. Employees should be made aware of the adverse effects of

unauthorized time off.

3. Monitor the attendance of all employees. The departmental heads should maintain an

attendance sheet on a regular basis.

4. Acknowledge regularity and punctuality, and reward appropriately.

5. Try to know the reason behind an employee's leave of absence. Face to face conversation

might help.

6. Conduct regular health check ups to curb absenteeism due to illness.

7. Introduce employee engagement programs to involve employees to participate actively in

the welfare of the organization.

8. Supervisors and managers should be trained to understand the psyche behind

absenteeism, and eventually decrease it.

9. Introducing counseling sessions could prove beneficial in curbing absenteeism due to

stress.

10.Keep your staff motivated by creating a favorable environment.


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Absenteeism in the workplace can be controlled, if adequate measures are taken. To attain zero

absenteeism is next to impossible. But with the controls in place, decrease in absenteeism is

guaranteed.

How to Control Employee Absenteeism in the Workplace

Written by: N. Plowman Edited by:Michele McDonough

Updated Jun 20, 2010

Many employers attempt to reduce absenteeism but find it difficult to successfully do

so because of a lack of understanding relating to employees and attendance. This

article identifies why employees tend to miss work and how employers can

effectively control absenteeism throughout the workplace.

Effects of Absenteeism on Businesses

After turnover, absenteeism can be one of the most critical human resource issues

for businesses. Observing, evaluating, and attempting to improve absenteeism can

be extremely difficult, but with the proper understanding of what causes absenteeism

and how to reduce it, businesses can limit the negative side effects of employee

attendance issues.

In addition to lowered workplace morale, less team cohesion, and decreased

organizational commitment, employee absenteeism is detrimental to businesses in

respect to the increased costs associated with high instances of absenteeism. When

employees do not come to work, employers are financially burdened due to the lost

productivity and increased costs associated with finding and paying for temporary

replacements. Additionally, absenteeism is positively correlated with turnover, which

means that the more an employee misses work, the more likely he or she is to

eventually leave the company. This resulting turnover also financially impacts a

business because of the costs associated with finding andtraininga permanent

replacement.

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Reasons for Heightened Absenteeism

Many studies suggest that most of employee absenteeism, roughly between 60%

and 70%, is due to reasons other than employee illness. The following are the most

common reasons employees tend to miss work.

Employees are stressed or preoccupied by personal matters, such as parental concerns,

marital problems, community involvement, family well-being, care for elderly relatives,

care for severely ill immediate family members, and so on.

Employees are overwhelmed with their current working situation, or they are overworked

due to workforce reductions and voluntary turnover.

Employees are dissatisfied with their current working conditions, position,team

performance, supervisor, or overall organization.

Employees are not committed to their team, department, or organization.

Employees are not challenged by their position and have increased feelings of burnout.

Ways to Reduce Absenteeism

Since most absenteeism is a result of non-illness related events, employers can

control approximately 60% of employee absenteeism. Obviously, an employercannot improve absenteeism due to personal reasons, but an employer can directly

influence the other four main causes of absenteeism through the following initiatives.

1. Increase employee motivation.

This is easier said than done, but it can be accomplished by

enhancing the intrinsic motivation employees receive from their job by making

production goals more realistic, increasing desirable job responsibilities, and

improving working conditions. An employer can also increase extrinsic motivation by

implementing a type of recognition or reward program.

2. Enhance job satisfaction.
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Job satisfaction is influenced by many employment factors. However, the best way to

improveemployee satisfactionis to reduce workplace stressors to make working

conditions more enjoyable and consistently provide honest and meaningful feedback

and praise.

3. Implement a job rotation or job enlargement strategy.

One of the reasons employees are frequently absent is lack of challenging work due

to repetition, boredom, and burnout. A way that employers can improve an

employees perspective of his or her position is to provide opportunities torotate

among jobsand to gain more skills and knowledge in an area of personal and

professional interest.

4. Reward and discipline employees for increased or decreased absenteeism.

Although this may seem elementary, the reward/punishment motive is still an

effective way to influence absenteeism rates in organizations. If a financial or

recognition-based reward is attached to instances of decreased absenteeism,

employees that are motivated to receive the reward will have fewer instances of

absenteeism and strive to achieve attendance goals. Furthermore, employees that

are motivated to avoid consequences positively react to this type of strategy.

5. Allow employees to utilize a modified work schedule.

Since some absenteeism is a result of personal-related matters, providing

employees the opportunity to be flexible in their schedules, occasionally or

permanently, helps employees feel more able to balance their work and personal life.

Flex time, or modified work schedules, can range in degrees of formality and type, so

the flexibility can be easily controlled by an employer.

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Home >Business >Entrepreneurship >Human Resources

Advantages of Job Rotation: Reduce Turnover by Influencing

Employee Burnout, Satisfaction, and Motivation

Written by: N. Plowman Edited by:Michele McDonough

Updated Jun 12, 2010
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A growing trend in business management is to implement a job rotation strategy. Strategies

can differ drastically, but business owners can be certain that implementing a job rotation

strategy will enhance organizational success thanks to more satisfied, motivated, skilled, and

committed employees.

Job Rotation Advantages

Many businesses, small and large, are attempting to improve work design systems by

incorporating a job rotation strategy. Job rotation exists when employees rotate across many

positions, in varying intervals and durations, in order to gain exposure to different roles and

functions. When implementing a job rotation program, companies can have employees rotate

only within their home department or across positions in many departments. Although job

rotation strategies may not be practical for all businesses, strategies that are implementedacross lower-level and less specialized positions provide many advantages to businesses and

employees.

The first advantage of job rotation isburnoutreduction. When employees perform the same

job functions each day without variation, they are likely to experience greater feelings of

fatigue, apathy, boredom, and carelessness. Burnout is d etrimental to

businesses because it tends to promote decreased productivity, increased absenteeism, and

increased likelihood of turnover, which all lead to organizational dysfunction. However,

when employees rotate across different positions regularly, they experience less boredom,

greater task variety, and decreased feelings of needless repetition.

The second advantage of job rotation isincreased employee satisfaction. Business owners

know that when employees are not satisfied with professional endeavors, they feel

demotivated, unhappy, and irritated, which are detrimental to productivity. However, by

allowing employees to engage in job rotation, employees are likely to experience greater

satisfaction by identifying strengths and weaknesses. Furthermore, employees are able to test

many positions and subsequently focus on rotating between positions that enhance

performance capacity, which increases their sense of worth and importance within the

company.

Process Com Formation
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The third advantage of job rotation is increasedemployee motivation. It is important for

business owners to provide opportunities to increase employee motivation because greater

motivation promotes higher levels of organizational commitment and desire to grow within

the company. When employees are given the opportunity to rotate between different

positions, they enhance and improve their skills, abilities, and competencies, which leads to

better job performance and greater likelihood of promotional advancement. Furthermore,

employees that are engaged with a number of different positions throughout a company

experience increased appreciation for coworkers and the interrelation between positions,which decreases animosity and enhances organizational commitment.

The last benefit is twofold, and it is an indirect benefit of job rotation. This article has already

established that job rotation strategies reduce employee burnout, increase employee

satisfaction, and increase employee motivation and organizational commitment. These three

benefits cumulatively influence a business's turnover rate and workplace injuries. Turnover is

greatly reduced because employees do not experience the fatigue, boredom, and

dissatisfaction associated with performing the same job every day. This, in turn, greatly

increases an employee's level of awareness and attention to detail, which decreases the

likelihood of workplace injury or stress.

See the complete Bright Hub Guide to Motivating Your Employees

Job rotation presents many unique opportunities for businesses and employees. The rationale

for implementing a job rotation design system may vary depending on business goals

andhuman resource strategies. However, whatever the reason, one thing is certain -

businesses that implement a job rotation strategy unquestionably reap the benefits of added

organizational success and more satisfied, motivated, and committed employees.

Absenteeism An d The Bot tom Line

IntroductionFacts and Figures
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Factors in Absenteeism-Morale: A Direct Correlation-Work Schedule Flexibility-Presenteeism: Another Face Of The Problem-Stress: The "Stress Cost Formula"-Shift Work

Solutions and Ideas

Introduction

Latest surv ey resul ts highl ight absenteeism issues.

The issue of absenteeism and unscheduled leave has always been of importance to businessesinterested in their bottom line.

Recently there has been more awareness of the costs of absenteeism and employers are beginningto assess its true impact on every aspect of their business. As they do a better job of tracking

absenteeism employers are beginning to realize how much they are actually spending on it, and areoften surprised at the actual figures when they are all added up.

One of the factors in the issue of absenteeism that has triggered a lot of press lately is the release ofthe "2003 CCH Unscheduled Absence Survey".

The results of the survey, which was conducted June 16, 2003 through July 9, 2003, appear in theOctober 22, 2003, issue ofCCH Human Resources Management Ideas & Trends, a newsletter for HRprofessionals.

Subsequently many articles have followed presenting the results of this survey and its possiblemeaning for employers nationwide.

In this article we will quote some of the findings from this important survey, but will round out the issuewith a wide variety of information on the deeper causes and possible solutions to this problem.

While scheduled time off for employee vacations is an inevitable cost of doing business, costs relatedto unscheduled absences can be reduced through wellness programs, disability management andflexible time-off options. Employers can't escape the salary costs of time off the job, but when theyplan ahead they can often eliminate indirect costs such as hiring a temp, paying someone else towork overtime or lost productivity.

The results of the CCH survey point to lower absenteeism rates recently, and lower costs peremployee because of this drop. On the surface this appears to be good news.

However, we will explore some of the deeper issues surrounding these figures and point out how thefigures on a superficial level don't tell the whole story. This is not meant to be a negative thing, but asa spur to the astute employer to try to understand the situation in a more detailed manner, and makebetter judgments in the long run because of this.

As an example of how the figures may not be what they seem, it is probable that the current economymay be among the factors in the overall reduced rate and cost of absenteeism.

"Employees may be more fearful of taking off time given the tight job market,"said CCH workplaceanalyst Lori Rosen, JD. "It's also worth noting that costs are down significantly, which is in part aresult of the fact that employers have been aggressive over the past year at finding different ways tocontrol wages. For example, many employees who are now coming back into the workforce are doing

so at a lower salary."
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Among the results of the survey is the fact that while more companies are tracking their costs, 83percent of companies surveyed by CCH believe that unscheduled absenteeism is likely to stay thesame or get worse in the next two years.

And significantly, the study finds that regardless of the absence-management programs availablecosts won't go down until employers make greater efforts to manage their impact, which they don't

appear to be doing.

In some ways absenteeism may be an indicator of a whole array of related factors that are crucial tomaking today's workplace more productive. It may be viewed as an important element in motivatingthe improvement of working conditions for employees and the bottom line for employers.

Facts and Figures

Sources:- 2003 CCH Unscheduled Absence- Business Insurance, July 2000

- U.S. Bureau of Labor Statistics

In 2003 the absenteeism rate declined to 1.9 percent, down from 2.1 percent in 2002, and 2.2percent in 2001.

In 2003 the average annual per-employee cost of absenteeism dropped to $645 from $789 in2002, $755 in 2001, and $610 in 2000.

Nearly two-thirds (64 percent) of unscheduled absences are due to Family Issues (22percent), Personal Needs (18 percent), Entitlement Mentality (13 percent) and Stress (11percent).

In 2003 full-time employees were offered the same number of sick days as in 2002, but tookfewer of them. On average, companies granted 7.6 sick days to employees in 2003 andemployees used 5.6 days, down from 6.2 days taken in 2002.

In 2003 an average of 48 percent of employees took zero to two paid unscheduled absence

days (up from 42 percent in 2002). Also, 40 percent used three to eight days and 12 percenttook nine or more days.

Extended hours employees account for 17.6 percent of the U.S. workforce, but 41 percent ofthe total U.S. cost of absenteeism.

In a survey of eleven U.S.-based telecommunications organizations, 72 cents of every dollarof costs related to employee absence stems from lost productivity, rather than hard costs,such as health care and disability benefits.(Business Insurance, July 2000)

Of all the expenses related to absence, unscheduled time off has the biggest impact onproductivity, profitability and morale. Companies lose approximately 2.8 million workdayseach year because of employee injuries and illnesses, according to the U.S. Bureau of LaborStatistics.(Reported 09/03)

Factors in Absenteeism

-Morale: A Direct Correlation-Work Schedule Flexibility-Presenteeism: Another Face Of The Problem-Stress: The "Stress Cost Formula"-Shift Work

- Morale: A Direct Correlat ion

At Braun Consulting Group we attempt to understand the issues at each workplace associated withMorale.
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For purposes of this article "Morale"is defined as "the pervasive emotional or mental condition ofemployees with respect to cheerfulness, confidence, zeal, etc. in their relationship with their employerand their work".

Regarding absenteeism, there is evidence that there is a direct correlation between the morale of aworkforce and the degree of absenteeism present.

Though this is common sense, it is borne out in some recent surveys.

Measuring morale has always been a difficult issue because the costs associated with poor moraleare not hard costs, and are often hard to track and quantify. But in the case of unscheduledabsenteeism the costs can be more clearly defined.

According to the latest 2003 CCH survey employers overall set aside an average of 4.4 percent oftheir budgets for absenteeism. However, when morale is factored in the results vary significantly.

The surveyors found that organizations with Poorto Fairmorale set aside 5.3 percent of their budgetsto cover the costs of absent workers compared to 3.7 percent in organizations with Goodto Very

Goodmorale.

That's a difference of almost 1.5%... and that can amount to a significant amount of money.

Morale also influences the reasons people call in sick at the last minute.

Organizations reporting Poorto Fairmorale were more likely to experience unscheduled absenteeismdue to Stress (14 percent) and Entitlement Mentality (16 percent) than organizations reporting moraleas Goodto Very Good(9 and 11 percent, respectively).

The effects of low morale are reflected across the board in the CCH survey. For example, while only20 percent of organizations reporting Goodto Very Goodmorale believe that unscheduled

absenteeism is a serious problem for them, 41 percent of organizations reporting low morale find it aserious issue.

It is clear that absenteeism is linked to morale. So employers attempting to deal with the costs andissues of absenteeism to their organizations have an area that they can approach head on that willdirectly influence the bottom line results - employee morale issues.

- Work Sch edule Flexibi l i ty

One of the factors that cropped up in the CCH survey is the fact that employers' commitment to work-life programs may be tapering off just as companies are starting to see the long-term payoff inreduced absenteeism and associated costs.

In past years, employers have introduced greater flexibility into the workplace with an array of work-life programs - employer-sponsored benefit programs or initiatives to help employees balance thedual demands of their professional and personal lives.

Some experts feel that there is a good likelihood that the fact that the last four years has seen anabsenteeism rate hovering around 2 percent is in part because employers are now realizing resultsfrom the absence control and work-life programs they put in place over the last several years.

The programs found to rank highest in curbing unscheduled absences are these:

1. Alternative Work Arrangements

2. Compressed Work Week3. Job Sharing, and4. Telecommuting


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These programs all provide employees with greater control over when and where they work.

While Alternative Work Arrangements showed a 6-percent increase in use over 2002, the otherprograms experienced declines in use by organizations:Compressed Work Week, down 18percent; Job Sharing, down 19 percent; and Telecommuting, down 4 percent.

Many indicators point to the fact that policies that address employees' needs can benefit employers inthe long run by raising morale and decreasing unscheduled absences.

If there is not a consistent commitment to empowering employees and raising employee morale thebacklash will most likely be increased costs due to higher rates of unscheduled absenteeism.

Lets hope that the declining absenteeism rates that we are currently seeing are not sabotaged byreactions of some employers who react by pulling the very programs that may have brought thoserates down to begin with.

Employers with an eye to long-term results will always be the ones who are careful to not make short-term decisions based upon the latest numbers. The correlation of flexibility in the workplace to

absenteeism rates is one that astute employers will keep watching closely.

- Presenteeism: A noth er Face Of The Problem

An interesting aspect of the absenteeism issue is something known as "Presenteeism".

Presenteeism is a term used by human resource professionals to describe circumstances in whichemployees come to work even though they are ill, posing potential problems of contagion and lowerproductivity.

When employees go to work sick they risk infecting their co-workers and will most likely not be aseffective or productive in their work. The drag on the bottom line and overall productivity of the

workplace can be subtle and hard to track effectively, but has now been acknowledged as a legitimatefactor in assessing costs relating to morale and absenteeism.

More employers and HR professionals are now realizing that "presenteeism" is another face to theissue of absenteeism that is a very important one, and one that has been largely ignored until now.The CCH survey found that nearly half of the employers surveyed this year felt that presenteeism wasa problem in their organizations.

It may seem contradictory at first to find a negative spin on an increased number of employees beingat work and having less scheduled absenteeism, but a closer look at this situation reveals thatpresenteeism is actually the result of lower morale and more pressure on workers. The cost is notdirectly in lost workdays, but indirectly in paying for more inefficient workdays and a potential forexponential multiplication of this cost by greater numbers of employees being affected by ill healthand lost productivity.

Strangely, it seems that workers at companies with low morale are more likely to show up for worksick, according to the CCH survey. Employers with low morale reported that 33 percent ofunscheduled absences were due to Personal Illness, compared to 39 percent at companieswith Goodto Very Goodmorale.

And yet again the study found that morale had an impact: Despite higher rates of unscheduledabsenteeism overall, companies with low morale have more ill workers showing up for work. Bothhigher rates of unscheduled absenteeism, and higher rates of sick workers at work are the result ofpoor morale at the jobsite.


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In fact, 52 percent of organizations with Poorto Fairmorale reported presenteeism was a problem,while just 38 percent of organizations reporting Goodto Very Goodmorale saw presenteeism as anissue.

Lower morale and more pressure to be at work seem to result in sick people being at work, andothers taking unscheduled leave for personal reasons.

- Stress: The " Stress Cos t Formula"

One source that studied stress and the workplace calculates that stress is linked to nearly 20 percentof absenteeism costs.

The latest CCH study puts the numbers of absenteeism due to stress as 11 percent of allunscheduled leave taken according to their respondents.

So, depending on your sources stress can account for anywhere from 10 to 20 percent or more ofabsenteeism costs.

Stress is difficult to measure, especially in terms of economic impact. However, this "stress costformula"that we are reporting in this segment gives us an idea of the results found by one source thatstudied this issue extensively.

In March of 2003 an article by Ravi Tangri, who is CEO and CCO ofChrysalis PerformanceStrategies, presented this "Stress Costs Formula"to measure the cost of stress on organizationsand individuals.

According to Mr. Tangri, the formula was derived from a comprehensive study of all the availableresearch available on the effects of stress, basing the percentages on the suspected impact stresshas on each of those factors. He states that it only includes calculations with solid research findingsbehind them and, when several figures are available, it usually includes the low end of the range (to

be conservative).

To calculate what stress costs your organization, plug in your own numbers. Use a one-year periodfor all numbers, and include everyone in the organization.

Calculate using the following numbers:

* 19 per cent of absenteeism costs(salary and benefit costs for days absent plus any additional expenses)

* 40 per cent of total turnover costs

* 55 per cent of employee-assistance programs(consult your provider for a more accurate number-it may be higher)

* 30 per cent of short- and long-term disability costs

* 10 per cent of drug-plan costs to cover psychotherapeutic drug costs

* 60 per cent of the total cost of workplace accidents

* The total cost of workers' compensation claims and lawsuits due to stress

This is the cost to your organization due to the effects of stress in the workplace.

To calculate the cost of absenteeism for an individual employee, add up the total salary and benefitcosts of the days that employee missed in the last year.


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For the total cost of absenteeism, add up these numbers for all employees, along with any othercosts, such as overtime required to fill their positions.

Multiply the total for all employees by 19 per centand that's the minimum cost of absenteeism due tostress.

These calculations provide a conservative estimate of what stress costs your organization.

There is no solid research giving accurate costs for the following factors, so the formula excludesthem:

* Productivity lost while employees are at work but distracted by stress;* Violence in the workplace including bullying, sexual harassment

and ethnic or racial harassment;* Disability and drug plan costs due to illnesses caused by stress.

In this article we don't have the answers about how to lower stress in the workplace, but only want tocall attention to how significant the factor of stress is in relation to absenteeism.

Ignoring stress in the workplace and its effects on your bottom line will cost you money, and one ofthe ways the impact of stress can be seen is in the rate of absenteeism.

An important way to combat absenteeism is to work with programs and ideas that reduce stress in theworkplace. There are no easy answers, but the effort will be worth it when you run the numbers andsee the bottom line impact of stress on your jobsite.

- Shift Wo rk

Circadian Technologies Inc. (http://www.circadian.com) released a study this year that reports theunintended and largely unrecognized costs associated with irregular schedules, night shifts and

extended hours.

They report that these factors are eroding the profits of American businesses by $206 billion annually,or approximately $8,600 per extended hours employee.

Around 24 million Americans, half of whom are in professional or white-collar occupations, workirregular schedules, night shifts or extended hours positions.

Extended hours employees only account for 17.6 percent of the U.S. workforce, but a whopping 41percent of the total U.S. cost of absenteeism.

This is clearly a significant number, and indicates a serious problem.

"Difficult economic times have resulted in understaffed and inefficiently staffed conditions in manyextended hours facilities. This, in turn, leads to excess and imbalanced overtime, high absenteeismand turnover rates, increased costs of recruitment, and excessive employee health and accidentcosts,"said Circadian's Alex Kerin, Ph.D., a report co-author.

The costs and risks of extended hours operations generally are unrecognized, the report states,because most employee data is not segmented by shift and because senior executives are generallynot present when the majority of problems related to extended hours operations occur.

According to the Circadian study some of the essential costs and risks preventing U.S. companiesfrom achieving the full potential benefits of extended hours operations are:


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* Lost product iv i ty- Measured as output per employee hour, productivity is 5 percent lowerbetween the hours of midnight and 7:00 a.m. than during the day.

* Absenteeism- Average absenteeism among companies with extended hours operations ismore than twice the national average, at 4.9 percent versus 2.1 percent.

* Turnover- Average turnover is nearly three times higher among extended hours workers,with a turnover rate of 9 percent in 2002 compared with a national average of 3.4 percent.

* Health care cos ts- Employees staffing extended hours operations suffer from significantlyhigher rates of obesity, gastrointestinal disorders, cancer, sleep disorders, and fatigue-relatedcar accidents.

Shif t Work and A bsenteeism Case Study

Another related study by Circadian Technologies involved the following scenario:

The company in this case study employed a five-day (Monday to Friday), three-crew schedule.

Following an upturn in business, in which the production capacity of five days was exceeded, thecompany asked workers to work on the weekends. As demand increased even more, the companysplit each of its day, evening, and night shifts into two sub crews. One sub crew worked both daysone weekend and the other crew worked the next weekend, allowing for 50 percent capacity forSaturday and Sunday. This resulted in employees working twelve straight days once a month.Overtime costs were high and the demand continued to increase to the point that 100 percentcapacity was required at all times.

However, even with the seven-day schedule, productivity levels were low due to the high level ofabsenteeism. Weekend absenteeism was especially high, as some employees rejected the extrascheduled hours and refused to come to work. Other employees, taking advantage of double-time payon Sundays, worked every Sunday and then called in absent for one day during the week. Employeesrealized they could receive the same compensation per week for fewer hours. From the employer'sperspective, the five-day schedule with "bolt-on" overtime for the weekends limited the ability tomaximize weekend capacity and also decreased efficiency during the week.

To resolve the situation, the company decided to move to a true 24/7 schedule that was selected bythe employees. More employees were hired to ensure 100 percent coverage, resulting in decreasedovertime. Absenteeism dropped dramatically and the plant reached 100 percent capacity and metdemand.(See http://www.circadian.com/clients/absent.html)

Solutions and Ideas

Here are some tips on how to manage unscheduled absenteeism abuse cases:

Promote a high performance work culture and emphasize the importance of the employeefitting into this culture

Provide flexible work practices that meet the needs of your business and your employees Introduce a reward system for any improvement to sick leave rates Try to eliminate or decrease "boring" or repetitive jobs Widen job responsibilities Increase promotional opportunities Recognize and reward your employees' contribution Improve the skills of supervisors

Provide training and development Work with employees to develop strategies to reduce absenteeism


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Implement preventative occupational health and safety strategies in order to minimizeworker's compensation absence

Monitor annual leave and long service leave data to ensure your employees are takingadequate recreational breaks.

Recognize a problem developing and intervene early before it escalates. Talk to employees who are abusing leave and see if their behavior stems from a personal

problem. Help them referrals if this is the case. Learn to say "no." Don't let employees get away with abusing leave policies. If you hear a

ridiculous request to misuse leave, politely decline.

Documents

Nine Ways to Reduce Absenteeism