Employee absence costs companies. It’s hard to imagine, but if you stopped to take count, you might be surprised to find that 7% of employees are absent from work. According to the latest survey from Statistics Canada, this represents a significant increase and translates into an average of 8.5 days absence per employee. Absence is defined as employees who reported off work for all or part of any given week because of personal reasons such as illness or disability, or personal or family responsibilities. And, as you might expect, many businesses find that “casual absentees” are responsible for 80% of lost days and in most cases, do not validate their absence with a medical certificate.

Absenteeism has significant costs for business and the Canadian economy. In addition to paying an employee who isn’t working, companies have to either hire a temporary worker or ask other employees to work overtime. This creates unexpected costs as high as 25% of direct salary. In addition, remaining employee productivity may be impacted resulting in project or product delays, lost sales, customer dissatisfaction and lagging employee morale. And a decline in morale will certainly become a major problem if the absent employee is a chronic abuser of sick leave. Finally, high absenteeism rates may impact your business insurance and workers compensation fees.

Interesting enough, many businesses don’t do a good job of tracking employee absence and many don’t have clear policies on absenteeism. For instance, a survey of 1,600 Ontario firms indicated that only 17% keep absenteeism data. But then again, sick leave is hard to manage because by definition, it’s unexpected. However, if a company really wants to get serious about its absenteeism rates, they can expect to see significant reduction in their extra payroll costs. So where does one start?

First of all, collect some statistics. Identify which departments are experiencing chronic or excessive absenteeism. Examine absence totals for the entire company and establish norms for each department as well as your company. Compare these statistics to Canadian norms. Review your statistics for absence patterns that point to a problem employee. Be particularly sensitive to serial absence such as the day before or after a holiday, or Fridays and Mondays. Watch for seasonal fluctuations. Then determine if job stress or workload is an issue or if there is management style conflict. Also be alert to employees who believe they are entitled to take their monthly sick days rather than seeing this benefit as insurance.

Next, you need to take steps to help employees understand that attendance is important. Communicate any identified problems of absenteeism, inform employees of your goals and make every effort to create rewards and incentives that support and value an attendance culture. Review and/or establish a set of absence management policies. Provide definitions for excused and unexcused absences, establish a notification protocol for reporting an absence, and develop methodologies for recording absences if they are not already in place. Be sure to include policies relating to the disciplinary process for excessive absenteeism so that all employees perceive they are being treated fairly and that problems are dealt with consistently.

Interesting enough, absenteeism has been found to be more of a problem in larger rather than smaller companies. And, many of these company’s, have taken quite creative steps to overcome their absenteeism problems. Absenteeism management strategies include flextime or the ability to make up lost time without penalty or exchange. Innovative programs such as lotteries and contests ranging from sports season tickets to giveaway trucks have also proven successful. A 2001 survey of employee benefits conducted by the American HR association reported that 62% of employers are now offering, “paid time off plans” which wraps up all paid leave and allows the employee to manage their time prudently within this framework.

As you can expect, there will be times when you must address the issues of excessive absenteeism head on. The key to success is to be well prepared. Here are some guidelines to assist you through this challenging task.

* Prepare for an employee interview by reviewing your policies and procedures, and confirming the absence record;
* Confirm the company’s resources available to the employee;
* Provide the employee with sufficient notice of your meeting;
* Prepare a summary of the absences and identify the key issues for discussion;
* Review your presentation for objectiveness, be sure to stick to the facts; have another party review your document;
* Develop your goals, the agenda and your strategy for the employee meeting;
* Schedule the meeting location so you will not be interrupted;
* Introduce the purpose of the meeting, review the company policies and present the employee with the summary of absences of concern;
* Discuss the financial and human costs to the organization resulting from the employees absence pattern;
* Clarify the company’s expectation for the employee’s attendance;
* Explain that your goal is to assist the employee to improve their attendance;
* Ask the employee to identify what can be done to improve their attendance and what steps the company can take to help them;
* Establish a plan of action that includes goals for improvement, a timeframe and follow-up activities;
* Follow-up and acknowledge any noted improvement or determine why the action plan goals have not been met; redefine the goals if necessary;
* Follow the company policy for disciplinary action should it be necessary.

Absenteeism is a chronic problem for many employers. But the problem can be eradicated through a systematic absence management program. Take steps to build a company culture that rewards employees for their accountability. Don’t become a statistic, do something now.

Sources: What Does Absenteeism Cost? How do I address Tardiness? , Retooling Absentee Programs bolsters profits, Programs That Slash Costs and Build Morale, Workforce.com archives, Daltec Occupational Health Services web page.