The True Cost of Absenteeism



A company can bear losses and costs burden by several factors- presenteeism and absenteeism being two of them! A company with a great and healthy workforce prospers well, though it isn’t always a guarantee. Many employees resort to absenteeism, where the employees miss work beyond what is expected of them.

What Is Absenteeism?

Absenteeism refers to an employee’s habitual absence from work, and this is usually intentional and without any proper reason. Some of the primary reasons for absenteeism include workplace harassment, family-related issues, illness, and job hunting. Absenteeism results in higher costs and losses for employers. While a few absences don’t create any hassles, absenteeism can make a massive setback for a company. Even though employers usually expect workers to miss certain workdays every year, excessive absences can lead to decreased productivity and have a significant effect on the finances of a company.

Causes of Absenteeism

Several factors cause absenteeism:

  • Bullying and harassment:Employees who are harassed and bullied by coworkers or bosses resort to absenteeism.
  • Stress and low morale: Heavy workloads, stressful deadlines and feelings of being unappreciated at work can cause employees to avoid going into work and resort to absenteeism.
  • Child and eldercare: Workers may resort to absenteeism to stay home and take care of any child or older relative at home when everyday arrangements don’t work out.
  • Depression: As per the National Institute of Mental Health, one of the leading causes of absenteeism is depression. It can also lead to substance abuse if people take to drugs or alcohol.
  • Disengagement: Employees who are not focussed on their jobs, coworkers, or their company are more likely to resort to absenteeism because of lack of motivation.
  • Illness: Injuries, illness, and medical appointments also lead to absenteeism. Acute injuries and chronic injuries like back and neck problems are also causes of absenteeism.
  • Job hunting: Employees may resort to absenteeism to attend a job interview, or work on their resumes.

Costs of Lost Productivity

According to a survey across 14 major occupations in the U.S, the total annual costs related to lost productivity summed up to $84 billion. According to it, the yearly costs associated with absenteeism vary by industry and occupation, with the maximum loss of the professional jobs.

According to ‘Absenteeism: the Bottom-Line Killer’, the costs of absenteeism can be attributed to factors like:

  • Wages paid to absent employees
  • High-cost replacement workers
  • Administrative costs of managing absenteeism
  • Poor quality of goods/services resulting from overtime fatigue or understaffing
  • Reduced productivity
  • Excess manager time
  • Safety issues
  • Poor morale among employees

What Employers Can Do

Absenteeism is a difficult situation to tackle as there are both legitimate as well as poor excuses for missing work. It can be a very challenging scenario for employers to monitor, control, as well as reduce absenteeism. Unless there is a written excuse from a doctor, it can be challenging to ascertain the cause and action for the same. Also, employers must consider the added costs associated with a sick employee who might spread illness in the workplace.

Companies and organizations can opt for a proactive approach by putting in policies in place to focus on responses to employee health concerns, like:

  • Physical health
  • Psychological health
  • Work-home balance
  • Environmental health
  • Economic health

This would mean having happier and healthier employees at work who would be regular and motivated to attend work each day.

Occasional absence and leave from work are inevitable; people do get sick sometimes. It is when absenteeism becomes a regular feat should the employer take note and due action, as missed workdays will have a profound financial effect on a company.

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Priyansha Mistry
Currently editor at The HR Digest Magazine. She helps HR professionals identify issues with their talent management and employment law. | Priyansha tweets at @PriyanshaMistry

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