Introduction of Absenteeism

Absenteeism is a habitual pattern of absence from a duty or

obligation.
Absenteeism occurs when an employee of a company does not
come to work due to scheduled time off, illness, injury, or any
other reason. The cost of absenteeism to business, usually
expressed in terms of lost productivity, is difficult to determine.
Traditionally, absenteeism has been viewed as an indicator of
rich individual performance, as well as a breach of an implicit
contract between employee and employer; it was seen as a
management problem, and framed in economic terms.
Absenteeism is the term generally used to refer to
unscheduled employee absences from the workplace.
Many causes of absenteeism are legitimate—personal
illness or family issues, for example—but absenteeism
also can often be traced to other factors such as a poor
work environment or workers who are not committed to
their jobs.
If such absences become excessive, they can have a
seriously adverse impact on a business's operations and,
ultimately, its profitability.
The Causes of Absenteeism
Serious accidents and illness

low morale

poor working conditions

boredom on the job

lack of job satisfaction

inadequate leadership and poor supervision

personal problems (financial, marital, substance
abuse, child care etc.)
poor physical fitness
transportation problems
the existence of income protection plans
(collective agreement )
benefits which continue income during periods of
illness or accident.)
stress
workload
employee discontent with the work environment
Costs of Absenteeism

Lost productivity of the absent employee

Overtime for other employees to fill in

Decreased overall productivity of those employees

Any temporary help costs incurred

Possible loss of business or dissatisfied customers

Problems with employee morale

Establishing a System for Tracking Absences

Absenteeism policies are useless if the business does

not also implement and maintain an effective system
for tracking employee attendance. Some companies
are able to track absenteeism through existing
payroll systems (Clock In or out), but for those
who do not have this option, they need to make
certain that they put together a system that can:
1) keep an accurate count of individual employee
absences;
2) tabulate company wide absenteeism totals;

3) calculate the financial impact that these absences

have on the business;

4) detect periods when absences are particularly high;

and

5) differentiate between various types of absences.

Types of absenteeism
There are two types of absenteeism, each of which requires a
different type of approach.
1. Innocent Absenteeism
Innocent absenteeism refers to employees who are absent for
reasons beyond their control; like sickness and injury. Innocent
absenteeism is not culpable which means that it is blameless.
2. Culpable Absenteeism
Culpable absenteeism refers to employees who are absent
without authorization for reasons which are within their
control. For instance, an employee who is on sick leave even
though he/she is not sick, and it can be proven that the
employee was not sick, is guilty of culpable absenteeism.
Steps to deal with Absenteeism
Individual Communication :
 After all available information has been gathered, the
administrator or supervisor should individually meet with
each employee whom has been identified as having higher
than average or questionable (or pattern) absences.
 This first meeting should be used to bring concerns
regarding attendance to the employee's attention.
 It is also an opportunity to discuss with the employee, in
some depth, the causes of his or her attendance problem and
possible steps he or she can take to remedy or control the
absences.
 Listen carefully to the employee's responses.
Proof of Illness
 Sometimes it is helpful in counseling employees with

excessive innocent or culpable absenteeism to inquire or

verify the nature and reasons of their absence.

After the Initial Interview

 If after the initial interview, enough time and counselling

efforts, as appropriate, have passed and the employee's

absenteeism has not improved, it may be necessary to
take further action. Further action must be handled with
extreme caution - a mistake in approach, timing
Counseling Innocent Absenteeism:
Innocent absenteeism is not blameworthy and
therefore disciplinary action is not justified. It is
obviously unfair to punish someone for conduct
which is beyond his/her control.
The procedure an employer may take for innocent
absenteeism is as follows:
Initial counselling(s)
Written counselling(s)
Reduction(s) of hours and/or job reclassification
Discharge
 Initial Counseling
Presuming you have communicated attendance expectations
generally and have already identified an employee as a
problem, you will have met with him or her as part of your
attendance program and you should now continue to
monitor the effect of these efforts on his or her attendance.
 Written Counseling
If the absences persist, you should meet with the employee
formally and provide him/her with a letter of concern. If the
absenteeism still continues to persist then the employee
should be given a second letter of concern during another
formal meeting. This letter would be stronger worded in that
it would warn the employee that unless attendance improves,
termination may be necessary.
 Reduction(s) of hours and or job reclassification

In between the first and second letters the employee may

be given the option to reduce his/her hours to better fit

his/her personal circumstances. This option must be

voluntarily accepted by the employee and cannot be

offered as an ultimatum, as a reduction in hours is a

reduction in pay and therefore can be looked upon as

discipline.
Discharge: it is the last level of punishment
innocent absenteeism dismissal case.
 Has the employee done everything possible to regain
their health and return to work?
 Has the employer provided every assistance possible? (i.e.
counseling, support, time off.)
 Has the employer informed the employee of the
unworkable situation resulting from their sickness?
 Has the employer attempted to accommodate the
employee by offering a more suitable position (if
available) or a reduction of hours?
 Has enough time elapsed to allow for every possible
chance of recovery?
 Has the employer treated the employee prejudicially in
any way?
Corrective Action for Culpable Absenteeism
culpable absenteeism consists of absences where it can
be demonstrated that the employee is not actually ill
and is able to improve his/her attendance.
The general procedure is as follows:
Initial Warning(s)
Written Warning(s)
Suspension(s)
Discharge
Verbal Warning
Formally meet with the employee and explain that
income protection is to be used only when an employee
is legitimately ill. Advise the employee that his/her
attendance record must improve and be maintained at
an improved level or further disciplinary action will
result.
Written Warning
Interview the employee again. Show him/her the
statistics and point out that there has been no
noticeable (or sufficient) improvement. Listen to the
employee to see if there is a valid reason and offer any
assistance you can. If no satisfactory explanation is
given, advise the employee that he/she will be given a
written warning.
Suspension (only after consultation with the
appropriate superiors)
If the problem of culpable absenteeism persists,
following the next interview period and immediately
following an absence, the employee should be
interviewed and advised that he/she is to be
suspended. The length of the suspension will depend
again on the severity of the problem, the credibility of
the employee's explanation, the employee's general
work performance and length of service.
Dismissal (only after consultation with the

appropriate superiors)
Dismissals should only be considered when all of
the above conditions and procedures have been met.
The employee, upon displaying no satisfactory
improvement, would be dismissed on the grounds of
his/her unwillingness to correct his/her absence
record.
How to Deal with Employee Absenteeism
Positive discipline
Punitive discipline.
Change Management Style
Change Working Conditions
Provide Incentives
PAID TIME OFF SYSTEM :Some companies have
approached similar problems by eliminating sick leave
altogether. Instead of vacation time and sick leave, the
companies have developed "paid-leave banks
Develop an Attendance Policy
 Employee Assistance Program (EAP).
 American's with Disability Act (ADA)

 or the Family and Medical Leave Act (FMLA

Absentee Management Metrics
Many approaches exist to measuring and gathering statistics
related to absentee management & employee attendance
tracking.  A quick online search will reveal a multitude of
Absentee Management System(AMS)  software: such as
employee attendance tracking software, timekeeping
software, employee time clock software, and employee
time and attendance software.  All these attendance
tracking software will help to automate most employee
attendance metrics & chart the absenteeism progression
accordingly.  However, regardless of what tracking software
is selected or even what employee attendance metrics are
ultimately chosen, vital to all absentee management
programs are that those metrics be:
  properly communicated;
 systematically reviewed with all employees; and,
 applied consistently across the employee base.
 To give you sense of the ‘types’ of employee attendance
policy measures utilized in the field of absenteeism
management, below are a few example employee
attendance metrics a typical company might employ.
Employee Attendance Record
There are three important statistics relative to any
employee absenteeism calendar or employee
attendance record system: 
 Number of days absent
 Number of incidents
 Pattern of absences
few steps of keeping absenteeism to a minimum.
Communicate your attendance policy across all
levels in the organization clearly
   Measure and thereby monitor the rate of
absenteeism in your company on a regular basis
 Initiate periodic health checkups to avoid
absences resulting out of illness
  Implement reward schemes for those employees
who are regular
Create a favorable and peaceful work
environment where relationship between workers
and supervisors are professional and devoid of
conflict.
 Provide adequate training to managers particularly

authoritative ones to curb absenteeism

   Engage supervisors to speak to employees who were

absent and have returned to work

 Educate and engage your employees actively in the

organization. Disciplinary action to correct absentees

should mostly be avoided. However counseling sessions
can prove useful.
 Keep your employees motivated and try making the

organization a fun place to work

Turnover
In a human resources context, turnover or labor
turnover is the rate at which an employer gains and loses
employees.
Simple ways to describe it are "how long employees tend
to stay“
Turnover is measured for individual companies and for
their industry as a whole. If an employer is said to have a
high turnover relative to its competitors, it means that
employees of that company have a shorter average tenure
than those of other companies in the same industry.
High turnover can be harmful to a company's productivity
if skilled workers are often leaving and the worker
population contains a high percentage of novice workers
Definition:
“According to Pigors and Myer’s labour
turnover costs not only human values but also in
money.” It includes,
Costs incurred in hiring and training each new
employees.
Cost of overtime, work required from regular
workers in order to maintain the requited level
of production until the new employee can do
his share.
Loss of production in the interval between separation of

the former employee and time when his replacement is

fully broken.
Expense in equipment or facilitates not being fully

utilized during the training period

Costs

There are two types of cost:

Direct costs relate to the leaving costs, replacement costs

and transitions costs.

 Indirect costs relate to the loss of production, reduced

performance levels, unnecessary overtime and low morale

HR Supply Forecast
It is process of estimating future quantity and quality of
manpower available internally & externally to an
organization.
Supply Analysis

 Existing Human Resources

 Internal Sources of Supply
 External Sources of Supply
 Existing Human Resources
 Capability / Skills Inventory using HR Information System
 Internal Supply
 Inflows & Outflows - The number of losses & gains of staff is
estimated.

 Turnover Rate - refers to rate of employees leaving.

= ( No. of separations in a year / Avg no. of employees during the
year ) x 100
 Absenteeism - unauthorized absence from work.
= ( total absentees in a year / Avg no. of employees x No. of working
days) x 100
 Productivity Level - = Output / Input. Change in
productivity affects no. of persons per unit of output.
 External Supply
 External recruitment, selection & placement - Advertisements,
Manpower Consultants, Campus Recruitment, Unsolicited
Applications, Employee Referrals
Measurement of labour turnover
Turnover can be computed for each type of movement in
and out of the company.
Following formulas are generally used to measure the
extent of labour turnover:
1. Accession Formula
2. Separation Formula
3. Replacement formula
4. Comprise formula
Accession Formula
Labour turnover ratio according to this formula is
arrived at by dividing the total accessories unit
during a specified period by the average labour
force that until during the same period.
Total accessories are all permanent and temporary
additions to the employment roll whether new or
retired employee.
Transfer from other establishment of the company
are also counted
The average labour force of a specified period
may be calculating by dividing the total no. of
employees on the payroll at the beginning & at
the period under consideration by 2.
Another measure which is occasionally used to
calculate this average is the no. of employees on
the payroll on the middle day of the specified
period given month is 600 (585 at the beginning
+ 615 at the end/2) and if during the same period it
has taken on 50 employees then,
585+615/2 = 600
Turnover arte = 50/600*100 = 8.33 %
Separation Formula

In this formula total separation during a specified

period are taken in to account.

Total separation means all the terminations of the

employment of the persons who have quit or have

been taken off the rolls for reasons such as lay
off,discharge,retirement,death,physical disabilities
etc..
Transfer of employee to the other establishment

of the same company are also included.

If 20 employee were separated from the payroll

during the same period in the above example,

then the turnover ration rate according to this
formula will be, See as follow

585+615/2 = 600

Turnover arte = 20/600*100 = 3.33 %

Replacement formula & Comprise formula
Replacement formula: It also known as the net turnover
rate or wastage rat e.
This formula uses for the total separation which ever is
lower.
(No. of employees joined/ Number of employees).100
 Comprise Formula: To minimizing the cyclical effects
upon turnover calculations some companies average the
separation & succession figure and then divided by the
average working force based upon both separation and
succession figure. See as follow
((50+20) /2/600*100 = 5.83%
Practical question
In 2010,The Mc-Grown company have 20 workers

who leave the company and 20 people are newly

recruited. The number of replacements are 10. The
company employees an average number of 200
workers in the year. Find the labour turnover ratio for
the year 2010?
Solution
No of separation + no of replacements + no of
recruitments X 100
Average no of workers
= 20 + 10 + 20 x 100
200
= 20%
How to reduce Labour turnover
Pay problem:

1. Increasing pay levels to meet competition.

2. Improving pay structure to remove inequities.

3. Altering the pay system to reduce excessive

fluctuation.

4. Introducing procedure for relating rewards more

performance
Employees learning for further their career

Providing better career opportunities and ensuring

that employees are aware of them.

Extending the opportunities for training.

Adopting and implementing promotion from within

policies and introducing more systematic and

equitable promotion procedure.
Deliberately selecting employees who are not likely

to wait move much higher than their initial jobs.

Employees leave due to conflict:
Introducing more effective procedures for
consultations, participation and handling the
grievance.
Improving communication by such means as
briefing groups.
Using the conflict resolution and teambuilding
techniques of organization development.
Reorganizing work and arrangement of offices or
workshops to increase group cohesiveness
Educating 7 training management in approaches to
improving their relationship with employees.
The Induction crises:

Improving the recruitment and selection

procedures to ensure that job requirements are

specified accurately and that the people who are
selected fit the specification.
Ensuring that candidates are given a realistic

picture of the job, pay and working conditions.

Developing better induction & initial training

programmes
Shortage of labour:

Improving recruitment, selection & training for the

people required

Introducing better methods of planning and scheduling

work to smooth out peack loads.

Changes in working requirements:
 Ensuring the selection and promotion procedures match

the capacities of individuals to the demand of the work.

 They have to do

 Provide adequate training & adjustments period when

working condition change.

 Adopting payment by result systems to ensure that

unindividuals are not unduly penalized when they are

engaged in short runs