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A study on

With reference to
A project report
submitted in partial fulfillment
the requirements for the award of degree



In almost all organizations, management is

confronted with the day-to-day problem of employee absenteeism.
Employee absenteeism, scheduled or unscheduled, for short or long
periods, legitimate or without acceptable reasons, remains a
problem in most organizations. Approximately one third of
organizations keep proper records of absenteeism. The impact of
absenteeism on an organization (the cost, measurement, managing
and control, as well as benchmarking absenteeism against other
similar organizations) is not always considered or established. Many
organizations do not have adequate absenteeism policies.
Management are not always aware of the impact of absenteeism on
their organizations, despite the fact that absenteeism can have a
major impact on an organization’s productivity, profits and
employee morale.
Absenteeism can have many reasons but
has only one result. It destroys the family income and the
company’s Economy. It is suicidal for the worker in the long run.

Every industrial organization strives hard to

maintainable and willing labour force. Modern industrial worker
expects a meaningful, satisfying and challenging job and job
environment. In this regard, industries should aim at creating a
conductive and congenial working environment, which would go a
long way in attracting, recruiting, developing, utilizing and retaining
competent workforce to achieve three vital objectives-improving
productivity and worker efficiency, improving quality of goods and
services and reducing and controlling costs of operations.

By absence we mean failure of a worker to report for a work

when he is scheduled to work i.e when the employer Authorised

absence is also treated as absence, while presence even a part of a

day or shift is non-considered absence. Absence on account of

strikes, lockout or lay-off is not taken into account. Weekly and

scheduled holidays are not included. A worker is taken to be a

person who is “regular” employee and is not a “badly” or a “casual”.

It will be appropriate to maintain that it makes little difference

whether we speak of term “absence of works”, “absenteeism” or

“non-attendance”. All these can be used as if they are


We may define absenteeism to be the manifestation of a

decision by an employee not to present himself at his place of work

at a time when it is planned by management that he should be in

attendance, and when he has been notified of such expectation.

Absenteeism has been defined by different authors and agencies.

Some of the definitions ate give below:-


1) U.S. Department of Labour defines “absenteeism” as the

failure of worker to report on the job, when they are

scheduled to work.

2) Mr. K. C. Fenelong has defined – “ Absenteeism is absence

from work, when work is available.”

3) Absenteeism refers to workers absence from his regular task

when he is normally Absenteeism.

A general definition of absenteeism includes

time lost, because of illness and accident and time away from

the job due to personal reasons whether authorized or

unauthorized. Authorized absence on leave with pay is also

treated as absence.

The aim of this study is to undertake a theoretical

study on absenteeism and to conduct an empirical investigation into
the cause of absenteeism and identify job factors that may have an
influence on absenteeism in organizations.

The study on the “ABSENTEEISM” at ITC

key to the organization & are heterogeneous in natures
Absenteeism has great importance on the performance of the
organization . Increased in absenteeism results decrease in
productivity through a loss of man hours .Management of ITC Ltd –
ABD-ILTD felt the need to investigate the case of absenteeism.

• To study the rate of absenteeism & the factors influencing


• To study the economic benefits of the employee in the


• To study various causes of absenteeism in ITC LTD - AGRI


• To find out the external factors for absenteeism.

• To suggest feasible measure to reduce the rate of


To study the absenteeism of employee in ITC LTD

- AGRI BUSINESS DIVISION-ILTD the following methodology is
used the data collection. The study is confined to ILTD is based on
both primary data & secondary data.


The main sources of primary data are collected

through structured questionnaires followed by personnel interview
from employee at various levels.


The sources of secondary data pertaining to the study are:

• Attendance registers of ITC LTD - AGRI BUSINESS DIVISION-


• Synopsis from various sections of personnel department.

• Annual\monthly report of ILTD.

• Journals, books, internet website.

A population of 132 technicians is taken for
administering random questionnaire. Out of it 90 were the data
responded. The sample size is 90 employees.


• The researcher could collect only 90 employee responses to

the questionnaire.

• The sample does not cover all the workers in the organization
due to logistical constraints.

• The accurate of the information is not granted although care

has been taken to cross check information through separate

• Some employee were not able to share their options &

feelings freely while interviewing them. so it was the
disadvantages to gather correct information.

• The study is limited to period of 30 days.

Industry &
company profiles


ITC is one of India’s foremost private sector

companies that has a diversified presence in cigarettes, hotels,
paper boards & specially papers, packaging, Agri- business, branded
apparel, packaged foods and confectionary, greeting cards and
other FMCG products.

ITC’s Agri Business Division is one of the India’s

largest exporters of agricultural products. ILTD Division, part of Agri
business, is the largest buyer, processor and exporter of cigarette
tobacco’s in India. The efforts of ILTD in tobacco development and
export marketing have enable India to become the fifth largest
producer and eighth largest exporter of cigarette tobaccos in the
world. The division has successfully leveraged technology up
gradation at the farm and processing ends to meet the
requirements of customers for quality and grades.

The Chirala Green leaf threshing factory has

state of the art processing lines that have reached optimum
productivity levels in through put and yields. Besides ensuring
superior product quality. These processing lines represent the global
benchmark for green leaf threshing plants.
Looking back in history British American
Tobacco Company had set up Indian leaf tobacco Development
Company to handle the procurement of tobacco in India and
actively encourage its growth by farmers. ILTD had discovered a
promising tobacco growing area in Andhra Pradesh called the south
India leaf area (SILA). Having established growing and buying
points, the important mile stone in ILTD history was establishment
of the processing facility at Chirala in 1922. From hand stemming
operations during 1922-80, today the GLT has grown into a state of
the art green leaf threshing factory with a capacity of 430 tones of
green leaf per a day. From an subsidiary to cigarette factories of
ITC, The division has grown with targets set to exports 50% of its
processed Tobacco in year, due to its continually improving
processing capabilities And expanding customer base.


Tobacco grown in India for over centuries, contributes

significantly to the well being of the country. From the marginal
farmer growing tobacco on unirrigated, small land holdings to
retailers in remote corners of India, over 26 million people benefit
from their direct or indirect association with the tobacco industry.

Grown on a commercial scale in over 100 countries

world wide, tobacco forn1s a major part of the socio-economic
lifeline of over ,15 developing countries. Besides creating economic
prosperity for rural populations, it generates substantial revenues
for those governments and boosts agro-exports.

The global production and consumption of tobacco

continue to grow at an estimated rate of 1.95 and the total market
in tobacco products is valued at US $275 billion-about 78%of
India's GDP. Tobacco and export of tobacco products are a major
source of income of developing countries- over 70% of Malawi's and
40% of Zimbabwe's exports earnings come from tobacco. Brazil and
china also depend on tobacco export incomes, which are in the
region of US $1.5 billion.

In India, tobacco is a major contributor to agrarian

economy, the exchequer and to agro-exports. Six million farm
laborers find gainful employment in tobacco farming. The tobacco
industry provides almost 10% of governments excise collections
and 4% 0f all agro-exports. While 85% of tobacco consumption
worldwide is in the form of cigarettes, in India it is less than 20%. A
skewered taxation policy has restricted cigarette volumes but
ensured that cigarettes account for 87% of revenue generated by
the tobacco sector. So, modest volumes have limited the
tremendous revenue potential of cigarettes and cigarette tobacco.
The global import-export trade in tobacco was worth $30 billion in
1994 of which 25% billion was genet\rated by cigarettes. With 78%
of Indian tobacco being non-cigarette types, exports have been
correspondingly modest-less than 1 % of the global trade. What
emerges clearly is the opportunity that cigarettes and cigarette
tobaccos offer in tem1S of revenue, improving quality of
employment, developing the rural economy and increasing foreign


Among commercial crops, tobacco occupies a unique

and distinct positsm. Tobacco uses just 0.3% of arable land to yield
it of agricultural value nearly 4o/t of India's agro-exports. No other
crop provides such value to the farmer under similar conditions in
India. It is grown in a large number of states with Andhra Pradesh,
Karnataka, west Bengal, TamilNadu, Bihar, Utter Pradesh, Orissa
and Maharashtra being the major tobacco providing areas. Andhra
Pradesh and Karnataka are the two states growing the cured
Virginia tobacco used in making cigarettes and also the exportable

Tobacco is drought resistant crop grown

substantially on non-irrigated soils. More than 50% of tobacco
cultivation takes place in areas without irrigation. This is significant
in a country like India where 70_ of arable land lacks irrigation. At
the same time it is the only hardly crop that withstood the residual
moisture and organic matter during three consecutive cyclones in
Andhra Pradesh and gave the farmer well yields.

It is short-term cash crop compared to other main

crops of the region and takes between four to six months to grow.
The tobacco farmer to cultivate other crops for the rest of the year
can use the land. Growing tobacco improves soil fertility there by
increasing the yield of other crops on the same soil.

The cigarette tobacco grower receives regular

scientific inputs on improving yield and quality, and developing new
varieties from the private sector as well as the b\government. The
central tobacco research institute in Rajahmundry, Andhra Pradesh,
has played an important part in agricultural research project that
spans six state agricultural universities and six centers under the
Indian council for agricultural research.


Though tobacco is a significant contribute to the

Indian exchequer, revenue generation from the segments restricted
by the nature of tobacco consumption. Despite being only 19% of
tobacco consumption, Rs 3500 crores out if the Rs 4036 crores
(nearly 87%) that accounted at tobacco excise in 1996 was x-
accounted by the cigarettes. If all tobacco consumption was in the
form of cigarettes, excise collections would theoretically have been
in the range of Rs 18000crores and would account fit 30% of the
government excise revenues instead of 10% if provides now. More
cigarettes b\generation mean a giant leap in revenue generation.

Cigarette excise is determines by length and type.

Therefore, the Kingsize segment (cigarettes longer than 75mm)
pays the highest excise Rs 1100 per 1000 cigarettes-and also has
the smallest market share only about 15% Excise rates in India
have increased annually. Volumes in the conventional length
segment of cigarettes has shown a small growth of 2.7% since
1993-94 while in sharp contrast the excise revenues have grown at
compound a\rate if 10.7%. This volume and revenue growth must
be seen in contrast with the impressive performance of the micro
segment (non-filter cigarettes not exceeding 60mm in length) after
duly reduction in March 1994, even though this reduction was
sustained for a brief period of two years. But in India, only 5% of all
types of smoked tobacco products are in the form of filter
cigarettes. This share is likely to shrink further with the budget
proposals of a 16% hike in the 70mm filter cigarette segment,
which accounts for 44% of the cigarette industry,

The golden leaf in India yields tremendous

promise. It is capable of not only making a much larger socio-
economic contribution at home, but had the ability to make India
emerge as a major player in the world tobacco market. India has
the infrastructural facilities, trained and experienced workforce
spanning all stages of tobacco production, and favorable agro-
climate conditions-factors, which undoubtedly augur well. It needs a
progressive tobacco policy to harness these advantages.

In order to attain the stated objectives, the

government needs to focus on these fundamentals.
 The specific duty structure in 1987 should be retained in view
of enhanced revenues it provides and in order to achieve
litigation free tax collections.
 The rate of duty of micro segment should be restored to Rs 60
per 1000 cigarettes, which has not affected the existing level
of industry and fetches major benefits to excise revenue.
 Retain single point taxation for cigarettes and discourage levy
of luxury and entry tax by state governments, which
contravene the Act of 1957.
 Excise duty should be reduced by 5%, the weighted average
impact of sales taxes on cigarettes, till the Supreme Court
pronounces a judgment on pending cases.
 Give due consideration to premium segment which provide
impetus to the high quality, exportable tobacco. This will also
protect excise erosion on account of increased smuggling of
foreign brands.
 The cigarette industry should be allowed the benefits of
bringing back damaged or defective goods for reprocessing.
Denial of this benefit has caused substantial loses to the
 If it is not possible to bring down rates, current rates should
be maintained for at least two or three years to stabilize the
market and encourage cigarette volume expansion.

Today's world increasingly relies on a. common

agenda, particularly in the context of commerce. In globalize
environment, all nations flow with the main stream of internal
trends. India is no exception. It has to convert its threats into
competitive advantage to emerge as a dominant player. Tobacco
offers this opportunity to India.

Variety Areas

FCV - Traditional – Guntur - Prakasam - Nellore-

Krishna –

Khammam Dist.

FCV - NLS-East & West Godavari Dist.

FCV - Mysore-Assam-Chick Mangalore- Shimoga.

VAC - Yeleswaram Burely- East Godavari Dist.

VAC - Vinukonda Burely-Guntur Dist.

VAC - Light Soil Burely-Orissa State-North Coastal


Areas in A.P.

FAC - WAF-Kurnool Dist (White Ash frill)

LAC - EAC- West Godavari

Rustic - Gujarat

Lalchapadia- Gujarat

Laljudy - Gujarat


a. Traditional Black Cotton : Andhra

b. Northern light soil tobaccos : Andhra

c. Southern light soil tobaccos : Andhra

d. Monsoon crop : Mysore

e. Monsoon crop : Orissa-Development


a. Monsoon Burely : Andhra

b. HDGRB : Andhra

c. SCN : Andhra

d. Rustica : Gujarat

e. Cigar tobacco : Madras

f. Bidi tobacco : Gujarat, Maharashtra and Madhya


1) Altria Group, Inc.(MO)

2) British American Tobacco p.l.c.(BAT)

3) Japan Tobacco Inc.

4) R.J.Reynolds Tobacco Holdings, Inc.(RJR)

5) Altadis, S.A.

6) Gallaher Group Plc(GLH)

7) Carolina Group (CG)

8) Reemtsma Cigarettenfabriken GmbH

9) Imperial Tobacco Group PLC (ITY)

10) UST Inc. (UST)

1) Altria Group, Inc. (MO): The house the Marlboro

Man built, Altria Group ( formerly Philip Morris
Companies ),is the world’s largest tobacco firm . Altria
operates its cigarette business through subsidiaries
Philip Morris USA and Philip Morris International, borh of
which sell Marlboro – the world’s largest-selleing
cigarette brand since 1972 .The company controls about
half of the US tobacco market. However, tobacco is only
part of the story. The company owns 84% of Kragt
Foods, the world’s #2 food company (after Nestle),
which makes Jell-O,Kool-Aid, Maxwell House, Oscar
Mayer, and Post cereals. The tobacco giant bought
Nabisco in late 2000, folding it into Kraft’s food
portfolio. Altria owns 36% of SAB Miller plc.

2) British American Tobacco p.l.c.(BAT): When

people pick up smoking, British American Tobacco (BAT)
picks up steam. Spun off in the reorganization of B.A.T.
Industries, BAT is the world’s #2 tobacco firm ( behind
Altria Group ) with about 15% of the market. It sells
nearly 780 billion cigarettes in about 180 countries.
BAT’s international cigarettee brands include Dunhill,
Kent, Lucky Strike, and Pall Mall; it also makes loose
tobacco and regional cigarette brands. Its US unit,
Brown & Williamson (Kool and GPC cigarettes), is
merging with the US tobacco business of R.J.Reynolds
Tobacco (RJRT).Companies controlled by South African
billionaire Anton Rupert own about 28% of BAT.

3) Japan Tobacco Inc.: Japan Tobacco has plenty to

puff about. It controls more than 70% of the cigarette
market in a country where half the men smoke and
warning labels suggest,” there’s a risk of damage to
your health , so let’s be careful not to smoke too
much.”A state monopoly until 1985 , Japan Tobacco
company, after Altria and British American Tobacco. Its
JT International unit (acquired from R.J.Reynolds )sells
Camel, Salem,and Winston brands outside the US . The
company also operates in foods, pharmaceuticals,
agribusiness, engineering, and real estate.

4) R.J.Reynolds Tobacco Holdings, Inc.(RJR): Give it

up? R.J. Reynolds Tobacco Holdings (RJR)has been
smoking for more than 120 years , but increasing taxes
and court costs have encouraged competition from
cheaper discount brands. Although RJR has been forced
to cut costs to maintain profits, the firm’s R.J.Reynolds
Tobacco company subsidiary (RJRT)continues to be the
#2 US cigarette maker , with a market share of about
23% --compared with the 49% share of the Altria Group
(formerly Philip Morris).RJRT’s Camel, Doral, Salem, and
Winston brands are among the best-selling cigarettes in
the US . RJR is merging its US tobacco business with
Brown & Williamson, the third largest US tobacco

5) Altadis, S.A.: When the smoke finally settles over

London , Gallaher Group helps kick it up again .The #2
UK cigarette company, Gallaher makes tobacco products
and sells them in Asia, continental
Europe,Ireland,Russia and other former Soviet
republics, and K. Its premium cigarettes include top UK
brands Benson & Hedges and Silk Cut;mid-priced
brands include Berkeley; and low-priced brands include
Dorchester and Mayfair. Gallaher also makes Hamlet
cigars, Amber Leaf hand-rolled tobacco, and Condor
pipe tobacco.

6) Gallaher Group Plc (GLH): When the smoke finally

settles over London , Gallaher Group helps kick it up
again. The #2 UK cigarette company, Gallaher makes
tobacco products and sells them in Asia, cintinintal
Europe, Ireland, Russia and other Soviet republics, and
the UK. Its premium cigarettes include top UK brands
Binsom & Hedges and Silk Cut; mid-priced brands
include Berkeley; and low-priced brands include
Dorchester and Mayfair. Gallaher also makes Hamlet
cigars, Amber Leaf hand-rolled tobacco, and Condor
pipe tobacco.

7) Carolina Group (CG): Newport news provides the

best read on Carolina Group’s Lorillard Tobacco, the #4
cigarette maker in the US. Lorillard accounts for about
25% of parent company Loews’ sales, but more than
85% of the profits. Newport, Lorillard’s top brand, is the
#2 cigarette brand in the US and brings in nearly 90%
of Lorillard’s sales; its other brands include Kint,
Maverick, Old Gold, and True . The company has joined
the rest of the tobacco industry in reaching legal
settlements with all 50 states. A Florida appeals court
overturned a $16 billion verdict against the company in
May 2003.Loews established Carolina Group in 2002 as
a tracking stock for its tobacco holdings.
8) Reentsma Cigarettenfabriken GmbH: Cigarette
maker Reemtsma Cigaretten fabriken has rolled tobacco
since 1910. The German company controls about 29%
of its home market and is one of the largest tobacco
companies in Europe. The company produces more than
60 brands, including Davidoff, Peter Stuyvesant, R1,
West. It sells its cigarettes through affiliated operations
in about 100 countries in Asia, Europe, and the
Americas. The UK’s Imperial Tobacco owns Reemtsma.

9) Imperial Tobacco Group PLC (ITY): The UK’s #1

cigarette maker (ahead of Gallaher Group), Imperial
Tobacco Group has traded up to an even bigger throne.
The company’s purchase of German tobacco firm
Reemtsma (Davidoff and West cigarettes ) nearly
doubled its size and made it the world’s #4 tobacco
company. Imperial’s brands include Lambert & Butler,
the UK’s #1 cigarette, as well as Castella cigars, and
Amphora and St Brunopipe tobacco. Its Drum brand is
the #1 hand- rolling tobacco worldwide, and Rizla is a
top cigarette paper. Acquisitions in Australia and New
Zealand have assured Imperial’s presence in emerging

10) UST Inc.(UST): for UST, the best part of a

baseball game is watching the players spit.A holding
company primarily for U.S. Smokeless Tobacco
Company, UST is the US’s largest manufacturer and
distributor of snuff and chewing tobacco. Its brands
include Copenhagen, Skoal, Red Seal, and Rooster. The
company’s International Wine & Spirits unit brings in
12% of sales by producing California wines under the
Conn Creek and Villa Mt. Eden labels and premium and
sparkling wines grom Washington under the Chateau
Ste. Michelle and Columbia Crest brands. UST also
produces premium cigars (Dom Tomas, Asteal and
Helix). Subsidiary UST International sells the firm’s
products outside the US, primarily in Canada.


ITC is the market leader in cigarettes in India. Its

India Tobacco Division (ITD) Pioneers the marketing of
cigarettes in India way back in 1910. ITC. Today is one of the
world's finest cigarettes manufacturing and marketing companies.
Backed by state-of- the-art technology and a portfolio of valuable
brands, ITC produces over 65 billion cigarettes a year.

ITC also pioneered the cultivation and

development of cigarette leaf tobaccos in India. With a 90 years
history of working closely with tobacco farmers, its Indian Leaf
Tobacco Development (ILTD) Division is the country's largest
buyer, processor and exporter of cigarette tobaccos. ILTD is
credited with bringing about the economic transformation of the
tobacco farmer in Andhra Pradesh where it is fondly referred to as
the "Talli Company" (Mother Company in Telugu).


ITC was incorporated on August 24, 1910 under

the name of 'Imperial Tobacco Company of India Limited'. Its
beginnings were humble. A leased office on Radha Bazaar Lane,
Kolkata, was the center of the company's existence. The company
celebrated its 16the birthday on August 24, 1926, by purchasing the
plot of land situated at 37, Chowringhee, (now renames J.L. Nehru
Road) Kolkata, for the Sum of Rs 310,000. This decision of the
company was historic in more ways than one. It was to mark the
beginning of a long and eventful journey into India's future. The
company's headquarter building, 'Virginia House', which came up on
that plot of land two years later, would go on, to become one of
Kolkata’s most venerated landmarks. The company's ownership
progressively indianised, and the name of the company was
changed to I.T.C Limited in 1974. In recognition of the company's
multi-business portfolio encompassing a wide rage of business -
Cigarettes & Tobacco, Hotels, Information Technology, Packing,
Special1y papers, Paperboards, Agri-Exports and Lifestyle Retailing
- the full stops in the company's name were removed effective
September 18, 2001. The company now. Stands rechristened 'ITC

Though the first six decades of the company's

existence were primarily devoted to the growth and consolidation of
the cigarettes and Leaf Tobacco businesses, the Seventies
witnessed the beginnings of a corporate transformation that would
usher in momentous changes in the life of the company.

In 1975 the company launched its Hotels

business with the acquisition of a hotel in Chennai, which was
rechristened ITC-Welcome group Hotel Cho1a'. The objective of
lTC's entry into the hotels business was rooted in the concept of
creating value for the nation ITC chose the hotels business for it's
potential to earn high levels of foreign exchange, create tourism
infrastructure and generate large-scale direct and indirect
employment. Since then lTC's Hotels business has grown to occupy
a position of leadership, with 44 owned and managed properties
spread across India. It also has a marketing and reservation
arrangement with the Sheraton Corporation, the reputed
international hotel chain.
In 1979, ITC entered the Paperboards business
by promoting ITC Bhadrachalam Paperboards Limited, which today
has become the market leader in India. Bhadrachalam Paperboards
amalgamated with the company effective March 13, 2002 and
became a Division of the Company, Bhadrachalam Paperboards
Division. In November, 2002, this division merged with the
company's Tribeni Tissues Division to form the Paperboards &
Specialty Papers Division. ITC's paperboards' technology,
productivity, quality and manufacturing processes are comparable
to the best in the world. IT has also made an immense contribution
to the development of Sarapaka, an economically backward area in
the state of Andhra Pradesh. It is directly involved in education,
environmental protection and community development.

In 1985, ITC set up Surya Tobacco Co. in Nepal

as a joint venture with the reputed Soaltee group. In August 2002,
Surya Tobacco became a subsidiary of ITC Limited. Its name was
changed to Surya Nepal Private Limited (Surya Nepal).

In 1990, ITC acquired Tribeni Tissues Limited, a

specialty paper manufacturing company and a major supplier of
tissue paper to the cigarette industry. The merged entity was
nan1ed the Tribeni Tissues Division (TTD). To harness strategic and
operational synergies, TTD was merged with the Bhadrachalam
Paperboards Division to form the Paperboards & Specialty

Papers Division in November 2002.

Also in 1990, leveraging its Agri-sourcing

competency, ITC set up the international Business Division (IBD) for
export of Agri-commodities. The Division is today one of India's
largest exporters.
Recently, ITC's Packaging & Printing business
has launched a line of high quality greeting cards under the brand
name "Expression". ITC has also entered the Lifestyle Retailing
business with the Wills Sport range of international quality relaxed
wears for men and women. ITC has spun off its information
technology business into a wholly owned subsidy. ITC InfoTech
India Limited, to more aggressively pursue emerging opportunities
in this area.


ITC is a board-managed professional company,

committed to creating enduring value for the shareholder and for
the nation. It has rich organizational culture rooted in its core value
pf respect for people and belief in empowerment. Strong corporate
governance policies and systems back its philosophy of all-round
value creation.

ITC's corporate strategies are aimed at

matching its core capabilities with market opportunities to produce
superior shareholder value.
The key corporate strategies are:

 Continue to focus on the core businesses of Cigarettes &

Tobacco, Hotels, and Packaging & Paperboard.
 Ensure that each of its businesses meets the three
criteria of sustainability, namely Market Standing,
Profitability and Internal Vitality. Exit from businesses,
which do not meet these criteria within an agreed time
 Ensure that each business is internationally competitive
in the Indian global market,
 Create distributed leadership within the organization by
nurturing talented and focused top management teams
for each of the businesses.
 Institute and practice a system of corporate governance
appropriate to ITC's character and constitution. Such a
system of governance must achieve a wholesome
balance between the need for executive freedom for
management and the requirement of a framework for
effective accountability.
 Secure the future growth of the company by creating
new businesses, which leverage the strength of its core
competencies, residing in various businesses.


• No stops to our commitment beyond the market

• No stops to our vision of contributing to the nation
• No stops to our endeavor to become world-class
• No stops to our creation of sustained shareholder value
• We have pulled out all the stops.


The main products from the green leaf threshing

factory at Chirala are Un- manufactured tobaccos…

 Lamina
 Stem
 AVR/export scrap
The services that are assured with the product

 Improved shelf life

 Elimination of non tobacco related material (NTRM)
 Pest and mould free
 Storage and handling/cool stores


Export and users

GLT at Unmanufactur ILTD
ed tobaccos
Chirala Other
Merchants and


ITC’s core values are aimed at developing a

customer- focused high performance organization which creates
values for all its stake holders.

As professional managers, we are conscious that ITC

has been given us in “Trust” by all our stake holders. We will
redeem the trust reposed in us by continuously adding value to ITC.


We will always be customer focused. We will deliver

what the customer needs in terms of value, quality and satisfaction.


We will respect and value people and uphold humanness

and human dignity. We will value difference in individual
perspectives. We want individuals to dream, create, experiment in
pursuit of opportunities and achieve leader ship through teamwork.


We will strive for excellence in whatever we do. We will

do what is right, do it well and win.


We will constantly innovate and strive to better our

processes, products, services and management practices.

We will pursue exemplary standard of ethical behavior.

We will at all times comply with the laws of the land.


Build and sustain ILTD as a world class business



Achieve international competitiveness in cost, quality

and services.


To continuously enhance product and process quality

through contemporary technology and operational excellence. The
factory management efforts are to harness the loyalty and sense of
belonging of the employees for alignment with the vision, mission
and objectives leading to a culture of stretch and innovation, there
by enhancing contribution.


There are many proprietary green leaf processing

units who are their main competitors in India.
Company Exports-Mkgs

(in 2002-03)

ILTD 24 (total 76)



ML 4

MA 4



The volumes of the competitors are smaller than ILTD

volume. Although they are competitors to ILTD,( Considering a
larger perspective) they are partners in promotion of exports from
India. ILTD shares information and provides them a part of their
volumes for processing for both developing their capabilities and
having alternate capacity for contingencies.

In the changing market scenario, some of them are in

the process of establishing cigarettes factories and entering into a
tie up with international merchants.

Strength off ILTD is the largest state of the art

processing facility, professional management and world wide
network apart from established internal communication system and
corporate monitoring systems.
Factors Chirala Average competition

Manpower 1.13 0.47

Power 1.04 1.52

Coal 0.22 0.60

Maintenance 0.53 0.78

Total 2.92 3.37

Productivity 200 116


The labour costs and standards of safety at Chirala are

much higher than competition and this is more than offset by higher
productivity and lower energy, maintenance costs. The advantage
of Chirala factory has over competition are long term strategy and
goals, implementation of systems such as ISO 9000 for product
quality, external audits and caliber of professionals engaged and
close association with end users.


• Large number of illiterate employees

• Growing percentage of young employees who have greater
aspirations & requirements
• To align new employee aspirations with the organization goals
and vision.
• Greater requirement for social responsibility initiatives
• Product traceability and integrity and value chain integration
• Demand for higher yields
• More stringent product quality tolerances

ITC's Packaging business has won numerous awards for

its quality, environmental management systems and product

 First in India to be assessed at Level 6 on the International

Quality Rating Systems (IQRS).

 Both the Chennai and Munger factories have obtained ISO

9002 certification. The Tinivottiyur and Munger factories have
also received the ISO 14001 Environment Management
Systems certification.

 Quality Improvement Benchmark Awards for 1997 and 1998.

 British Safety Council Swords of Ron or in 1999 for both the

Chennai and Munger factories.

 CAPEXIL Special Export Award for 1999 and Top Export Award
for 2000/01.
 The World Star award for Aashirvaad Select 2-kg pack in the
Consumer Pack category in 2002, Wills Natural Lights in 1999,
Royal Velvet & Passport whisky cartons in1998 and Nargis
lined tea cartons and Vacupack bulk packaging for tea in
 Asia star awards for packaging excellence in 1999, 2000 and
in 2001 we have received 3 Asia star awards for Surya lOs,
Royal Stag 750ml and No.1 Gift Pack.
 India Star Awards for unique, innovative and visually
appealing packaging in 2002 for the Aashirvaad Select 2-kg
pack and for Bagpiper Gold, Royal Challenge and Sara lee
Celebration packs in 2000.


Y. C. Deveshwar

Executive Directors
S. S. H. Lehman

Non-executive Directors
C.R. Green

Y.P. Gupta

P.B. Ramanujam

B. Sen

J.B. Stevens

Ram S. Tameja

T.M. Nagarajan

B. Vijayaraghavan




Plant was also considered as "The largest tobacco

threshing in Asian continent". In ITC Limited, ILTD Division has a
history of 85years of partnership with formers and leadership in the
cultivation of Cigarette Tobacco. ITC introduced natured and
developed Virginia and purely Tobacco in India. There are Six
Chronological events in ILTD starting from 1980- 1990.

In ILTD Division there are Two Factories in A.P. one is at

Anaparthi and another is at Chirala. Guntur is the Head Office for
these two factories. Chirala is located at distance of 350K.M. from
Chennai and south east of Hyderabad.

The first activity in Chirala was in the year 1918, started

with leaf buying, redrying factory was setup in the year 1926 at
Chirala over the period with changes in the environment and
business needs, green leaf threshing plant was setup in the year
1985 with increase in customer demands. Second line was added in
the year 1990 - 91 to enhance the production capacity. The plant is
with state of art and technology and was considered as one of the
best plants in India in turns of products quality and this division is
located in Perala village outskirts of Chirala, which is providing
agricultural commodity, as it deals with agricultural commodity, the
operational phase in each and every year, varies with seasonal and
non-seasonal periods.

Modernization has been a continuous process at Chirala

factory keeping customer needs as the guiding post. In 1984 the
factory switched over from hand stripping to mechanize threshing
with an initial installed capacity of 4 Tons per hour. Today the
factory has 2 threshing lines capable of threshing 13 Tones per
hour. Both the threshing lines are designed for soft threshing with
abundant classification area to achieve a high product quality.

The factory has a quality control laboratory of

international standards with facilities for online monitoring and infra
analyzer to analyze chemistry of Tobacco. The factory has also a 33
KV sub-station of 5MVA capacity from the State Electricity Board
and have a standby captive generation power plant for 100% power
requirement of the factory. The leaf storage capacity is of 7.5
million Kgs. With facilities for mechanized unloading and loading
operation. The quality of the product supplied to the domestic and
overseas customers is a true reflection of the morale and
commitment of the employees of the factory continuous
improvement in various aspects of the quality of the Product.



“To enhance the wealth generating capacity of the enterprise

in globalizing environment, delivering superior and sustainable
stake holder value"


1. To be dominating player in every field in which, we choose to

2. To attain and maintain the leadership position in exports
among private sector companies in India.
3. To become one of the foremost institutions in the world for
plant material based formulation/ products commercial scale
to make this world safer place to live.
4. To reestablished and strength in over image as a friend of the
farmer as an institution contributing. Significantly to rural
prosperity through improving the economics of the farming
community and tribal population.


Quality: Chirala green leaf-threshing facility is the world’s first ISO

9002 certified tobacco-processing plant

Safety: The factory is the one of the safest factories, a fast

confirmed by the awards of the British Safety council for the years
1993 & 1994 and sword of honor for 1994.


ILTD’s Green leaf threshing plant at Chirala

has been awarded the BS 7550 certification, a British environmental
system standard, by the Bureau Verities Quality International
(BVQI). Chirala becomes the first ITC unit to get the Environment
Management System (EMS) certification and joins a select brand of
companies in India to have this distinction.


1. Feeding
2. Conditioning
3. Band reeling
4. Dividing
5. Picking
6. Threshing
7. Classification
8. Redrying
9. Processing packing
10. Prizing Marking

The first activity in Chirala was in the year 1918,

started with leaf buying, redrying factory was setup in the year
1926 at Chirala over the period with changes in the environment
and business needs, green leaf threshing plant was setup in the
year 1985 with increase in customer demands. Second line was
added in the year 1990/91 to enhance the production capacity. The
plant is with state-of-art- and technology and was considered as
one of the best plants in India in terms of product quality and this
plant was also considered as "The largest tobacco threshing plant in
Asian continent". This division is located in Perala village outskirts of
Chira1a adjacent of industry in Chirala, which is providing
agricultural commodity, as it deals with agricultural commodity; the
operational phase in each and every year varies with seasonal and
non-seasonal periods.

Seasonal Period: - It starts from November and ends with July

with a gap of one or two months.

Non-seasonal period: - It starts from august and ends in October.

During seasonal period, the plant is engaged with threshing green

leaf tobacco with full utilization. On the contrary during the seasonal
periods spread over four months in the year i.e., during monsoon
period in the area of plant shutdown. During the above period the
seasonal workers are discharged. The engineering and essential
service personnel will be carrying out the maintenance and of the



The unionized employees are of three distinct

categories viz.,

1. Clerical/class' A'

2. Technicians

3. Class 'B' workers

1. Clerical/class' A':

This category comprises of all

 Clerical staff members,

 Watch & ward,
 Compounders,
 Pharmacists,
 Male nurse and
 Quality inspectors

In the scale of S-1, S-2, S-3.

There are both Non-seasonal and seasonal employees with in

this category. All clerical class 'A' employees are monthly
rated/monthly paid employees.
Except those working in the watch & ward all other clerical
staff are under the functional control of the Factory Accountant and
therefore the matters pertaining to their transfer, allocation of
duties department wise etc., are required to be dealt with by the
Factory Accountant/ Management accountant.


This category consists only Non-seasonal employees in the

following scales VIZ.,




T-4 &


Technicians don't consist of seasonal employees. This is

because the machines that are to be used while threshing the
tobacco must be maintained for the' good quality of output. So this
work will be there for the entire year.

This category is a pool of technically qualified employees

catering to the needs of production and Engineering Departments.
By virtue of their allocation to different Departments, they perform
the duties in respective departments but are interchangeable from
one Department to another depending upon the need. Technicians
are monthly rated/monthly paid employees.
Class 'B' workers:

This category of employees consists of both Non-seasonal

and seasonal components. The scales in this category are as


1. Monthly Rated (MRB-I)

2. Monthly Rated (MRB-2)
3. Monthly Rated (MRB-3)

1. Daily Rated (DR-I)

2. Daily Rated (DR-2)
3. Daily Rated (DR-3) se of the study.

The Non-seasonal class 'B' workers are monthly

rated/monthly paid and the seasonal class 'B' workers are daily
rated/weekly paid.

All class 'B' employees posted in the plant are in scale

2 either daily rated or monthly rated. Identified jobs specified below
are in scale3 either daily rated or monthly rated:

A. Maistry
B. Cylinder operator
C. FL truck Driver
D. Quality control laboratory
E. Boiler Home
F. Markers
G. BOPT operators
The remaining employees posted in Departments other than
the plant or the jobs specified above shall be in scale 1.


These employees are not members of any union but for the
purpose of working out the establishment, they shall be counted
against the vacancies of unionized staff of clerical/class' A' or
tec1micians as the case may be.

The terms of appointment and other service conditions to the

senior grade are specific and differ from other members of
unionized cadre.

Non unionized
Category Numbers

Managers 31

Staff y 11

Sr. Grade 12

Managers are qualified degree/diploma holders in

different fields of specialization as required for their role. Staff Y is
junior managers and Sr Grade is Supervisors who have grown from
unionized cadre.

Unionized Seasonal Non- Total

Technicians Nil 158 158

Class A 140 34 174

Class B 1516 125 1641

Badli 313

Technicians category are a pool of technically qualified

employees who cadre to the needs of production and engineering
departments. Clerical are primarily those who maintain the accounts
and capture data at different locations in the factory. Class B are
those engaged for mostly manual tasks in the factory and the
majority are illiterates.

Each of the unionized categories of employees has their

own democratically elected union and the elections are held once in
two years. These office bearers are elected by their category of
employees across the ILTD Division with representatives for the
division for the operating units.


Employees in different categories are entitled to

different types of leaves. The details are as follows:


Annual leave

Sick leave

Casual leave

Seasonal clerical/ class ' A':

1. Annual leave:-

The actual working days of the season are taken and

the annual leave is calculated at the rate of one day for every 20
days, if the actual leave thus calculated is less than 7 days. 7 days
minimum is credited to the account of the employee where the
number is excess of 7 days, actual number of days is credited.

All the other rules as per non-seasonal clerical/class' A'

where the employee report for the duty again during the year, the 7
days leave shall be adjusted against the yearly entitlement based
on actual working days during the year.

There is no provision for accumulation. Annual leave as

due is en cashed at the closure of any seasonal paid along with
the .season's final payments.

2. Sick leave:

As per non-seasonal clerical/class' A' with full wages. No


3. Casual leave:

14 days wages on a flat rate. The rates applicable at

any given tome are communicated by DHQ.

Non-seasonal clerical/class ' A':

1. Annual leave:

All clerical class' A' employees are entitled to annual

leave at the rate of one day for ever 20 immediately preceding

Leave shall be credited on the 1st January every year

considering the working days of the previous year. For the purpose
of calculating the working days of the previous 'year, only days on
which the employee is physically present shall be taken.
In other words, leave availed during the-previous year
shall not be counted as working days.

The leave calculated as above should be subject to a

minimum of26 working days for those who have put in 240 days or
more working days, for others shall be in proportion to the actual
working days.

While calculating the actual working days any fraction

of20 in excess of 10; days shall be treated as 20 days.


Working days leave

20 1 Day

29 1 Day

31 2 Days

40 2 Days

49 2 Days

51 3 Days

60 3 Days

69 3 Days

71 4 Days

Annual leave shall be allowed to be accumulated up to a

maximum of 90 days.

2. Sick leave:

On 1st January of every year 14 days sick leave is

credited to the leave account of the employee. Sick leave can be
accumulation up to a maximum of 90 days.

Sick leave shall be sanctioned only on the

recommendation of the company medical retainer.

3. Casual leave:

On 1st January every year, 10 days casual leave shall be

credited to the account of the employee. No accumulation of casual
leave is permitted. Unused leave at the end of the year shall lapse.

In case an employee is confirmed in the middle of the

year, annual leave shall be. Calculated as per details given in the
class of Non-seasonal employees. Leave shall however be credited
to his account on the first of January of the next year along with
other non-seasonal employee. For the period he has worked as a
seasonal and no leave pay shall be payable to him since he would
'not be discharged from service along with other seasonal due to
confirmation. Similar treatment shall be given to sick leave also.


1. Annual leave:

All rules pertaining to Non-seasonal clerical/class 'A' are

applicable to technicians except the accumulation limit.
Accumulation limit in the case of technicians is 180 days.

2. Sick leave:

On 1st January of each year 14 days leave is credited to

the leave account of the employee. Sick leave can be accumulated
up to a maximum of 90 days.

Sick leave shall be sanctioned only on the

recommendation of the company medical retainer.

3. Casual leave:

On l5th January each year, 10 days casual leave shall

be credited to the account of the employee. No accumulation of
casual leave is permitted. Unused leave at the end of the year shall

Non-seasonal class 'B':

1. Annual leave:

All rules pertaining to non-seasonal clerical/class 'A' are

applicable to non- seasonal class 'B' except the accumulation limit.
Accumulation limit is 60 days.

2. Sick leave:

In 1st January of each year 14 days sick leave is credited

to the 'leave account of the employee. Sick leave can be
accumulated up to a maximum of 90 days. Sick leave shall be
sanctioned only on the recommendation of the company medical

3. Casual leave:

On 1st January of each year, 10 days of casual leave

shall be credited to the account of the employee. No accumulation
of casual leave is permitted. Unused leave at the end of the year
shall lapse.

Seasonal class 'B':

1. Annual leave:

Annual leave is calculated at the rate of one day for

every 20 of work put in. There is no maximum in case of seasonal
class 'B'. The actual days arrived at; as per the above calculation is
the annual leave. Annual leave is encashed at the time of closure of
season. No accumulation is permitted.

2. Sick leave:

14 days with full wages for a calendar year. No


3. Casual leave:

14 days with wages at a flat rate. No accumulation.

4. Extra-ordinary sick leave:

In certain cases where employees suffer from prolonged

sickness. Extra ordinary sick leave is granted depending upon the
length of service of the employee whenever such case is come up
the application along with the details of the sickness and necessary
recommendation of the company's medical officers are required to
be sent to Guntur. Employee Relations Manager only is authorizes
to sanction extra-ordinary leave.

5. Quarantine leave:

Quarantine leave is a special kind of leave granted to

the employee in the event of one of his family member confronting
communicable disease. The intention of Quarantine leave is to see
that the employee in the factory do no (confront such
communicable disease through the employee in whose family one of
the members is suffering from communicable disease. The treating
doctor certifies that the employee who is otherwise healthy is
capable of passing on this disease to the employers in the Factory.
Such leave that is permissible is 14 days quarantine leave is in
addition to all other types of leave that the employee is entitled to
this 14 days shall not be dedicated only leave.

6. Half day leave:

If an employee is required to leave the work spot due to

personal emergency is entitled to apply for half-day casual leave.
Literature review

Absenteeism has been variously defined by different

authorities .

According to Webster’s dictionary:-

,”Absenteeism is the practice or habit of being an

‘absentee’, and an ‘absantee’is one who habitually stays away.”

According to labour bureau, simla ,

’ Absenteeism is the total manshifts lost because of

absences as a percentage of the total number of manshifts
schedules to work .”

In other words,it signifies the absence of an employee

from work when he is scheduled to be at work ;it is unauthorized
,unexpected , avoidable, and willful absence from work . For
calculating the rate of absenteeism, two facts are taken into
consideration -----the number of persons scheduled to work and the
number actually present. A worker who reports for any part of a
shift is to considered present. An employee is to be considered
scheduled to work when the employer has work available and the
employee is aware of it, and when the employer has no reason to
expect, well in advance, that the employee will not be available for
work at the specialized time. Any employee may stay away from
work if he has taken leave to which he is entitled, or on the ground
of sickness or some accident, or without any previous sanction of
leave. Thus, absence may be authorized or unauthorized, willful or
caused by circumstances beyond one’s control.

Management of absenteeism has been observed that

the phenomenon of absenteeism does not exist only in Indian
industry; it is a universal fact. The difference is only in terms of
magnitude. the rate of absenteeism from 7 percent to 30 percent .
In some occupations, it has risen to abnormal level of 40 per cent in
some seasons. The extent of absenteeism may differ from industry
to industry ,place to place and occupation to occupation, it may also
differ according to the make-up of the work force.

There have been many systematic studies of

absenteeism in Western industrialized countries. For example, it has
been observed that absenteeism among the younger workmen is
extensive on Mondays after the week end , particularly among
unmarried men who, after a late night on Sunday perhaps with their
girl friends , find it difficult to get up and come on time and
concentrate on work; and it is the lowest on pay day.

In the USA, I have been observed that curiously

enough, the extent of absenteeism is greater among youngsters
than among the older employees, greater among women than men.
Young men general found to be absent for a variety of reasons,
including restlessness and a sense irresponsibility. In some cases,
absenteeism of particular workers is due to reasons connected with
the job; a worker, for example, may be absent because he does not
like his job for some reason, or because he has unsatisfactory
relations with his supervisor with other employees. Absenteeism
may also be due to sickness, real or feigned.

There has been a phenomenal rise in absenteeism in

some industries. In the cotton textile industry in madras, it shot up
from 8.9 % in 1951 to 16.0% in 1980. Increased from 12.7% to
22.0% in Bombay, 8.3% to 14.9% in Ahmadabad; and 12% to
24.8% in Kanpur. In the engineering industry, it increased from
13.9% to 19.1% in Maharashtra; in west Bengal from 10.1% to
17.3%; and in Karnataka from 9.7% to 15.7% during the same
period. A similar trend was noticed in woolen industry, where in the
same period, the percentage of absenteeism went up from 10.6 to
18.8 in Dhariwal; in gold mining in Karnataka from 10.2 to 18.0; in
the plantations industries in Karnataka from 18.3 to 20.7. In the
coal mines, the increase ranged between 13.5 to 20.4 per cent.

These figures are of unauthorized absenteeism. If to

these are added the liberal provisions in awards and settlements
for privilege leave, casual leave, sick leave and maternity leave, it
would be found that the number of non-working days in the year in
the industries in India is very large.

Absenteeism in Indian industry is not new phenomenon.

The royal commission on labour reported that “high absenteeism
prevails among industrial labor mainly due to their rural
orientation.”since then , a number of individual researchers have
investigated the problem, and have pointed out that absenteeism in
our industries varies from 7 per cent to 15 per cent .its incidence is
high in plantations and in mines; and it is higher in northern India
than in southern India.


On the basis of micro studies undertaken in different

parts of the country, certain observations may be made.
a) The rate of absenteeism is the lowest on pay day; it
increases considerably on the days following the
payment of wages and bonus.

“The level of absenteeism is comparatively high

immediately after pay day, when workers either feel like
having good time, or in some other cases return home to
their village to make purchases for the family and to
meet them.”The incident of absenteeism, both before
and after a holiday, has also been found to be higher
than that on normal days.

b) Absenteeism is generally high among the workers below

15 years of age and those above 40. “The younger

employees are not regular and punctual,”presumably
because of the employment of a large number of new
comers among the younger age groups; while the other
people are not able to with stand the strenuous nature of
the work.

c) The rate of absenteeism varies from department to

department with in the unit .for example ,in mixing and
blow room ,and in the bundling and the baling jobs in
which only a few workers are employed and the physical
condition are better than in other departments ,the rate
of absenteeism is comparatively low .as the size of a
group increase, the rate absenteeism goes up .this
difference in the rate of absenteeism is believed to be
due to the peculiar style and practices of management ,
the composition of the labor force and the culture of the
organization .

d) The percentage of absenteeism is generally higher in

night shifts than in the day shift s. This is so because

workers in the night shifts experiences greater
discomfort and uneasiness in the course of their work
than they do during day time .

e) The percentage of absenteeism is much higher in the

coal and mica mining industries than in organized
industries . this high percentage of absenteeism is due
to the engagement of labourers in the fields,marriagies
and festivals ,which together are estimated to account
for about 75 percent of the cases of withdrawals
,drunkenness, relaxation or sickness .

f) Absenteeism in India is seasonal character .it is the

highest during March–April-may ,when land has to ready
to monsoon sowing ,and also in harvest season ,when
the rate goes as high as 40 percent .


The phenomenon of absenteeism has been explained in

various ways. According to one line of thought ,absenteeism is due
to lack of “commitment” on the part of the opinion that since “the
degree of commitment varies with the degree of a country’s
industrial growth or maturity ,absenteeism is inversely related to
industrial development …. The worker in progress of the early
stages on industrialization is more prone to absenteeism, prolonged
and sporadic withdrawal from industrial work. Wild cat stoppages,
naked violence, and destructions of machines and property.
Absenteeism is due to the factors that influence a worker’s

Hone the other hand ,refutes this contention ,and is of

view that “absenteeism is related to new values and norms which
are developing among the work force as a result of technological
developments .work and leisure are now cherished by the worker
,and these he wants to enjoy along with the monetary benefits he
gets to his services. The economic condition, therefore, decides
whether one would like to be absent form work.”

The royal commission on labor observed that “high

absenteeism among Indian labor is due to its rural orientation and
its frequent urge for rural exodus. “According to Acharya:”in
modern industrial establishments, expect, perhaps, in very small
ones, the individual personality is more or less irretrievably
submerged in the general mass through the sheer incidence of
being throw together with other individuals for a certain purpose ,
during a good bit of each day’s life .the individual has no elbow-
room and is hammered into a set pattern, while the human sprit
clamours for open spaces and unfettered air so that it may kick its
legs about for a change .” The incidence of industrial fatigue, trying
climate, universal malnutrition and appallingly bad working
conditions aggravate the feeling for change among industrial
workers and sometimes impel them to visit their village homes
frequently for rest and relaxation.

American authors hold the view that absenteeism due to

the “internal administration of an organization.”According to
them,”the work milieu is very important since a large part of the
worker’s daily life is spent there.” The atmosphere obtaining in a
plant, therefore, affects his attitude to his work, and either
persuades him top attend regularly or keep him away .Irritating
uncertainty, irregularly, and confusion in the factory are likely to be
important causes of absenteeism .

The attitude and practice of the management also

contribute to absenteeism. A traditional management treat workers
as hirelings, while an enlightened management treats them as
human beings. This difference is behavior leads, in the former
situation, to high absenteeism, and in the later situation to a close
affinity in the organization, the result being lower absenteeism.

Various empirical studies on the micro level in the India

have been undertaken to find out the cause which have contribute
to a high percentage of absenteeism. A few of these illustrative
studies may be quoted here .

 Unsuitable working conditions.

 Unfavorable mental attitude arising out of boredom,

disconnect with wages, resentment against supervisor;

 Lack of provision for general welfare.

 Inadequate medical facility for minor injuries.

 Increase distance between management and workers.

Sinha analysis twenty variables in relation to absenteeism under the

three heads

• In_plant causes

• Personal causes and

• Community and social causes.

The general causes of absenteeism may be discussed:


As a worker continues to live in the city, urban life

becomes distasteful to him because of his insanitary conditions
prevailing there. He finds himself caught with in great factory walls;
he is bewildered by heavy traffic, by jostling, by stringer speaking in
different languages; he confusion by different religions and tastes;
and he is weary of the misery of slums and of toiling for long hours.
He is subject to strict discipline and is ordered by complete stringers
to the things which he cannot understand. As a result, he under
constant strain, which causes him serious distress and impairs his
efficiency. All these factors tends to persuade him to maintain his
contacts with his village.


Social and religious functions divert workers from work

to social activities. In large number of cases, the proportion of
absenteeism due to sickness, accident or maternity is not as it is
due to other causes, including social and religious causes. For
example, the absenteeism in the textile industry due to sickness,
accident or maternity amounted to an average of 4.9 percent; due
to social or religious and other cause, it was 5.1 percent. The report
of the study group on iron and steel industry points out:”some
religious considerations account for absenteeism to a certain extent.


The workers who comes to towns usually find that they

are not wanted and they swell the number of unemployed and
casual workers. They also experience housing difficulties. Not less
than 95 percent of the houses occupied by industrial workers in
India are unsatisfactory for healthful habitation. A room of about
10’x10’ accommodates a large family and occasionally two families;
often ten to fifteen persons sleep in one room. The housing of
migrants combines the worst characteristics of both rural and urban
slums. Not only are the sites most insanitary but the material used
for erecting huts are also very filthy. Forsaken places like the slopes
along the railway lines, banks of open drainages streams, waste
land adjoining dirty locations in towns, open space earmarked for
dumping the town refuse are chosen by them. Health conditions are
naturally bad, leading to high morbidity and consequent ill_health.
They, therefore, make frequent visits to their village homes to get
relief from such insanitary and unhealthy surroundings.


Low wages compel a worker to seek some part-time job

to earn some side income. But this often results in constant fatigue,
which compels him to remain absent for the next day; and if fatigue
affects him seriously, his absence may continue for quite some


Irritating and intolerable working conditions exit in

factories. Heat and moisture, noise and vibrations in the factory,
bad lighting conditions, dust, fumes and over_crowding---all of
these affect the worker’s health, causing him to remain absent for a
long time.


It has been observed that most of the absentees are

alcoholics. Also, the present system of disbursing wages for
employees at the end of week is also enhancing the absenteeism
percentage. These employees, after receiving their wage either an
Saturday or Monday, going to cheap liquor shops and spending their
money. It is taking a day or two to recover from that effect, Hence
absenting from duty.


As the employees are depending upon additional

sources of income like, agriculture, business daily labor etc. Some
of the employees are giving more importance to these jobs than
employment in industries.

Company is also offering various types of loans to the

employees, which are mostly misused by the workers these loans
are given to be workers without proper verification of reasons
stated. Taking this as an advantage, workers, mostly alcoholics, are
quoting silly and not genuine reasons for sanctioning loan .
Amounts drawn from these loans are mostly used for alcohol, only
in few cases: the actual purpose of the loan is served.


Most of the employees are of the opinion that absence

can be changed as leave by obtaining the respective supervisor / in-
charge, even without prior intimation to them.

Having this opinion and the practice of sanctioning

leaves, employees are absenting without prior permission. This is
affecting planning of work. Supervisors with work oriented rather
than man oriented approach are also a factor which compels
workers to absent themselves on an E.S.I certificate rather than
avail of leave on bonafide grounds.


“Absenteeism is a serious problem for a management

because it involves heavy additional expenses. Reserves and
understudies are kept in readiness to take the place of the
absentees, failing which the overhead cost of idle equipment has to
be faced .Industrial employees do not usually ask for leave of
absence in advance or even give notice during their the probable
duration of an employee’s absence and cannot take appropriate
measures to fill the gap”.
As regards measures to be adopted to remedy the
situation, the labour investigation committee, 1946, was of the
opinion that “proper conditions of work in the factory, adequate
wages, protection from accidents and sickness, and facilities for
obtaining leave for rest and recreation constitute the most effective
means of reducing absenteeism.”

The Encyclopedia of social sciences suggests the

measures to reduce the rate of absenteeism:

 The personnel management should encourage notification,

especially in cases of sickness when the duration of absences
is likely to be long.

 The case of personal and family circumstances, e.g., illness of

children in the case of married women employees which make
absence unavoidable, leave should be grant liberally.

 To reduce unavoidable absence due to sickness and industrial

and industrial accidents, programmes of industrial hygiene
and safety should be strengthened.

It should be noted no single measure can be effective in

controlling absenteeism; but a skilful combination of various
measures would measures would definitely lead to the desired
results. These measures are:


The selection of employees on the basis of communal,

linguistic and family consideration should be discouraged or
avoided. The management should look for aptitude and ability in the
prospective employees and no easily yield to pressure or personal
likes and dislikes. Application blanks should invariably be used for a
preliminary selection and as tools for interviews. The personnel
officer should play a more effective role as a coordinator of
information, provided that he has acquired job knowledge in the
function of selection. Employers also should take into account the
fact that selection should be for employees’ development; their
reliance, therefore, on intermediaries for the recruitment of
employees should be entirely done away with. They should, as far
as possible, rely on employment exchanges.



In India, where the climate is warm and most of the

work involves manual labor, it is essential that workers should be
provided with proper and healthy working conditions. The facilities
of drinking water, canteen, lavatories, rest rooms, lighting and
ventilation, need to be improved. Where any one of these facilities
is not available, it should be provided. All these help in keeping the
employee cheerful and increase productivity and the efficiency of
operations throughout the plant.



Some of the wages of an employee determine his as

well as his family’s standard of living, this single factor is important
for him than any other. The management should, therefore, pay
reasonable wages and allowances, taking into account the capacity
of the industry to pay, the level of wages prevailing in different
units of the same industry in the same area in neighboring
industries. The allowances that may be paid to workers should
include old age allowances, length_of_service allowances, position
allowances, special job allowances, good attendance allowances,
transportation allowances, position allowances and housing
allowances, so that the worker may have and know security of

The management should recognize the needs of workers

and offer them adequate and cheap housing facilities, free or
subsidized food, free medical aid and transportation facilities to and
from their residence, free educational facilities for their children,
and other monetary and nonmonetary benefit.



Since a majority of workers are illiterate, bulletins and

written notices, journals and booklets are not understood by them.
Therefore, timely illustrations and instructions, meetings and
counseling, are called for. Written communication becomes
meaningful only when workers can read and understand. As regards
notice boards, too many notices should be avoided; only the
essential one should be put on the board, which should be placed
near the entrance, inside the canteen and in areas which are
frequently visited.

As for the grievances settlement, the management

should recognize that a delayed grievances may become a
complicated case. A procedure for fair and prompt redressal of
grievances is, therefore, essential. It would be better if the various
units adopt the model grievances procedure. Supervisors should be
trained to handle a worker’s grievance in an informal and humane


The management’s strict attitude in granting leave and

holidays, even when the need for them is genuine, tempts workers
to go on E.S.I. leave for under the scheme, they can have 56 days
in a year on half pay. An effective way of dealing with absenteeism
is to liberalize leave rules.


The system of workers’ education should be so designed

as to take into account their educational needs as individuals for
their personal evaluation: as operatives for their efficiency and
advancement; as citizens for a happy integrated life in the
community; as members of a trade union for the protection of their
interests. This educational programme, according to the national
commission on labor, should be to make a worker:

A responsible, committed and disciplined operative;

 Understand the basic economic and technical aspects of the

industry and the plant where he is employed so that he may
take an intelligent interest in its affairs;

 Aware of his rights and obligations;

 A responsible and alert citizen;


 There should be clear and definite rules and regulation on

authorized and unauthorized leave.

 The rules and regulations relating to attendance must be

explained to workers.

 A proper records of each worker’s attendance should be

maintained on a special daily attendance card.

The employer, employee and the state have a definite

role to play. If each performs it properly harmoniously, the
problems of inefficiency, undesired conflict, low productivity,
dissatisfaction on the part of workers and their low morale resulting
in frequent absenteeism can be largely eliminated. Industrial
relations in a democracy should be based on an integrated approach
aiming at individual satisfaction and group satisfaction, and
achievements of the goals of the community and of the nation as a
A sample of 90 respondents we selected at random
from Technicians only in ITC, ILTD Division, Chirala, A survey was
conducted by way of questionnaire to find out why the employees
are absenting for scheduled work .

The questionnaires are analyzed in both Table format

and graphically.

Table – 1

Sl. No Age Group No of Percentage


1. Below 25 10 11.2

2. 30 – 35 40 44.5

3. 35 – 40 25 27.8

4. Above 40 15 16.7

Total 90 100


From the above table it is found that 11.2% respondents

are belongs to below 25 years age,44.5% respondents are belongs to
30-35 years age, 27.8% respondents are belongs to 35-40 years age,
16.7% respondents are belongs to above 40.
Table – 2

Sl. No FAMILY BACK No of Percentage %

GROUNDS respondents

1. Agriculture 35 38.9

2. Business 10 11.2

3. Employee 40 44.5

4. Others 5 5.6

Total 90 100


From the above table it is found that 38.9% respondents

are belongs to Agriculture, 11.2% respondents are belongs to
Business, 44.5% respondents are belongs to Employee, 5.6%
respondents are belongs to Other back grounds.
Table – 3

Sl. No Category No of Percentage


1. YES 60 66.7%

2. NO 30 33.3%

Total 90 100%


From the above table it is found that 66.7% respondents

are Alone source of Income to their family.
Table – 4

Sl. No Category No of Percentage


1. Yes 45 50%

2. No 25 27.8%

3. Trying 20 22.3%

Total 90 100%


From the above table it is found that 50% respondents

are Regular For Work, 27.8% respondents are Not Regular For
Work, & remaining 22.3% respondents are Trying To Regular For
Table -5

Sl. No Category No of Percentage


1. Yes 20 22.3%

2. No 70 77.7%

Total 90 100%


From the above table it is found that 22.3% Employees

are ready to leave their present job & remaining 77.7% employees
are not ready.
Table – 6

Sl. No Category No of Percentage


1. HS 5 5.6%

2. Satisfied 30 33.4%

3. Normal 40 44.4%

4. NS 15 16.6%

Total 90 100%


From the above table it is found that 5.6% respondents

are Highly Satisfied (HS), 33.4% respondents are Satisfied, 44.4%
respondents are Normal Satisfied & remaining 16.6% respondents
are Not Satisfied (NS).
Table – 7

Sl. No Category No of Percentage

1. Family 25 27.7%

2. Habits 5 5.6%

3. Health 10 11.2%

4. Activities 50 55.6%

Total 90 100%


From the above table it is found that reasons for

absenteeism 27.7% respondents are absenting from their Family
Problems, 5.6% respondents are absenting form their Bad Habits,
11.2% respondents are absenting form their Health Problems &
remaining 55.6% respondents are absenting from their other
Table -8

Sl. No Category No of Percentage


1. Regular 20 22.3%

2. Often 30 33.3%

3. Not at all 40 44.4%

Total 90 100%


From the above table it is found that 22.3% respondents

are take Alcohol Regularly, 33.3% respondents are take alcohol
Often, & remaining 44.4% respondents are Not Take Alcohol .
Table – 9

Sl. No Category No of Percentage


1. Full 80 88.9%

2. Part 10 11.1%
3. Not aware 0 0%

4. No need 0 0%

Total 90 100%


From the above table it is found that 88.9% respondents

are fully aware of the consequences of absenteeism, and remaining
11.1%respondents are partly aware of the consequences of
Table – 11

Sl. No Category No of Percentage


1. Full Salary 5 5.6%

2. Welfare Facilities 5 5.6%

3. Work Practices 15 16.7%

4. All The Above 65 72.2%

Total 90 100%


From the above table it is found that 72.2% respondents

are says that Fully Salary, Welfare Facilities, Work Practices make
them work regular, 16.7% respondents says that Work Practices
make them work regular, 5.6% says that Welfare Facilities make
them work regular & remaining are says that Fully Salary make
them work regular .
Table – 12

Sl. No Category No of Percentage


1. Yes 30 33.4%

2. No 60 66.6%

Total 90 100%


From the above table it is found that 66.6% respondents

says that organization didn’t punish them due to absenteeism &
remaining 33.4% respondents are punished by organization due to

 It is found that 50% respondents are Regular For Work,
27.8% respondents are Not Regular For Work, & remaining
22.3% respondents are Trying To Regular For Work.

 It is found that 22.3% respondents are take Alcohol

Regularly, 33.3% respondents are take alcohol Often, &
remaining 44.4% respondents are Not Take Alcohol .

 It is found that 72.2% respondents are says that Fully

Salary, Welfare Facilities, Work Practices make them work
regular, 16.7% respondents says that Work Practices make
them work regular, 5.6% says that Welfare Facilities make
them work regular & remaining are says that Fully Salary
make them work regular.

 It is found that 66.6% respondents say that organization

didn’t punish them due to absenteeism & remaining 33.4%
respondents are punished by organization due to

 It is found that reasons for absenteeism 27.7%

respondents are absenting from their Family Problems, 5.6%
respondents are absenting form their Bad Habits, 11.2%
respondents are absenting form their Health Problems &
remaining 55.6% respondents are absenting from their other

 It is found that 38.9% respondents are belongs to

Agriculture, 11.2% respondents are belongs to Business,
44.5% respondents are belongs to Employee, 5.6%
respondents are belongs to Other back grounds.

From the analytical observation the following
alternatives are suggestions in the organizations to control

 It is recommended to link the compensation with attendance

of employees to work.

 It is suggested for penalty style of punishment in case of

alcoholic employees.

 The interpersonal relationships & work environment should be

employees favor in order to control absenteeism.

 The process of leave sanctioning should be streamline in the

organization in order to control absenteeism.

 To award the best employee in terms of absenteeism. either

financial or non financial style of motivation to control

 The seasonal service computations are to be linked with




CATEGORY : Technicians / Non – Seasonal Class A / Seasonal Class


Non – Seasonal Class B / Seasonal Class B

(Tick mark the relevant category & strike off others)

1) You fall under the age group of :
(a) Below 25 (b) 20-35 (c) 35-40 (d) 40-45 (e) Above 45

2) How many members are there in your family (including you)

(a) (4 members) small (b) (5 members) medium (c) large (above 6)

3) Can you specify your family background

(a) Agricultural (b) Business (c) Employee (d) other

4) Are you alone the earning income in your family?

(a) Yes (b) No

5) What is your contribution to your family

(a) Fully (b) Partially (c) Need fully

6) Do you have any additional source of income?

(a) No (b) Yes (What is the source?)

7) Are you regular to work

(a) Yes (b) No (c) Trying to be regular

8) Are you satisfied with your job?

(a) Yes / highly (b) Normal (c) Not satisfied

9) Planning to leave the present job?

(a) No (b) Yes (why?)

10) How do you feel your working conditions are?

(a) Very good (b) Satisfactory (c) Not good

11) What is your favorite pass time

(a) Being at home (b) With friends outside (c) Alone (d) Peers

12) What is your Financial position

(a) Satisfactory (b) Borrowing (c) leadings (d) more than sufficient

13) How did you spend your wage

(a) Pre-planed (b) Luxuries (c) Expensive (d) unplanned

14) Are you satisfied with your salary?
(a) Highly satisfied (b) Satisfied (c) Normal (d) Not satisfied

15) Dose the relationship with other employees motivate to attend regularly
(a) yes (b) no

16) Do you have debts

(a) Yes (b) Not at all (c) Planning for it

17) What makes you to absent?

(a) Family problems (b) Bad habits (c) Ill health (d) Extra activities

18) Do you take Alcohol

(a) Regularly (b) Often (c) Not at all

19) Do you know that Alcohol causes ill health

(a) Fully aware (b) Partially aware (c) not aware (d) no need of awareness

20) If you are an Alcoholic, do you really wants to quit Alcohol

(a) Yes (b) No

21) Are you aware of the consequences of absenteeism?

(a) Fully aware (b) Partially aware (c) not aware (d) no need of awareness

22) How do you feel about this organization

(a) Great (b) Safe (c) very strict (d) friendly

23) Do you know the Factory Standing Orders

(a) All of them (b) Some of them (c) None of them

24) Which shift do you like to work

(a) ES (b) LS (c) MS (d) FH

25) Are you happy with shifts Rotations

(a) Yes (b) No

26) Every time when you apply for leave, leave is sanctioned?
(a) some times (b) every time (c) need fully (d) never

27) What makes you to work Regular?

(a)Full salary (b)Welfare facilities (c)Safe & Healthy work practices (d) All the above

28) How long you have been associated with the organization?
(a) 0 to 5 years (b) 6 to 10 years (c) 11 to 15 years (d) above 16 years

29) Were you suspended from the organization due to absenteeism?

(a) Yes (b) No.

30) Specify the reason for absenteeism


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