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Employee absenteeism: The cost to employers and 4 ways to tackle the problem

Renee Mary Varghese, M.Sc.

What is employee absenteeism?

Employee absenteeism refers to the phenomenon where employees are absent from work on a regular basis or without prior notification. This could be due to a variety of reasons from illness, and personal or family issues, to a disinterest in work. This type of behaviour can have a detrimental impact on a company’s output and financial stability, hence employers need to keep a track of this and take measures to control it. While absenteeism due to illness and emergencies is common, it becomes a concern when it becomes a habitual absence, and it affects not just the individual but also the organization as a whole.

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What are the 3 types of absenteeism?

There are 3 types of absenteeism: scheduled, unscheduled and partial shift. 

Employers generally do anticipate their employees taking time off annually. However, an excessive amount of employee absences causes lost productivity and eventually financially impacts the stability of the business. Employers need to be cognizant of the frequency of their employees taking unscheduled time off without a valid reason so they can effectively manage its impact on their business. To achieve this, it is crucial to comprehend the underlying reasons for employee absence.

Causes of absenteeism in the workplace

1. Lack of flexible work schedule: 

Every employee and their personal struggles are different, and how it contributes to their ability to work is also different. A variety of factors such as family obligations, health issues, or other personal circumstances can impact employee attendance if the hours offered by their employer are not accommodating to their individual needs. When employees struggle with a work-life balance it causes a lack of job satisfaction which can be a major cause of excessive absences. 

2. Poor leadership

Low employee engagement due to poor leadership in the form of lack of communication, lack of support or recognition, micromanagement, at times workplace harassment or an overall negative work environment. These elements can influence an employee’s drive, emotional well-being and contentment with their job, which can ultimately result in more frequent unplanned absences.

3. Mental health issues

Many employees struggle with common mental health problems like depression and anxiety disorders which can impact an employee’s cognitive function, emotional control, and conduct. This may eventually result in reduced productivity and efficiency. They may be struggling with somatic symptoms such as headaches, fatigue, body aches and muscle tension which can make it hard to complete their job responsibilities. An employee feeling unwell eventually leads to increased absenteeism rates as they may need time to seek treatment and manage symptoms. Furthermore, mental health difficulties may lead to presenteeism, which is when employees come to work but are not fully engaged or productive. 

4. Employee burnout

Burnout is when a person is emotionally, mentally and physically exhausted by perpetuated and extreme stress. Employees going through burnout may want to take time off from work to recuperate or may find it difficult to attend work because of physical or mental health concerns associated with burnout. In severe situations, burnout can lead to an extended absence from work, such as taking a medical leave.

The impact of absenteeism in the workplace

Absenteeism in the workplace can have an immense impact on business operations and be detrimental to overall productivity. Frequent absences cause productivity losses, poor quality of work, and decreased efficiency. The consequences of absenteeism can be especially when essential employees are missing. This may result in increased costs for employers as they would probably need to hire temporary staff or overtime to cover absent employees’ workload. Thus leading to a loss in revenue, especially in industries where revenue is closely tied to revenue generation.

Company culture is impacted by absenteeism, because other employees may end up with a huge workload which causes resentment, frustration, low morale and a negative work environment. It creates a culture of unreliability and inconsistency, which can impact workplace relationships and communication. When employees are frequently absent, it can be challenging to build trust and effective teamwork, which can have a long-term impact on the company’s culture. 

In general, as the quality of work decreases and is left unaddressed, it can also negatively impact customer satisfaction, employee motivation, and the reputation of the company. This is particularly true if the company prioritizes excellent customer service as part of its culture, making absenteeism an even more significant threat to the organization’s values and objectives.

How much does employee absenteeism cost employers?

The cost of employee absenteeism can vary depending on several factors, such as the size of the organization, the industry, and the frequency and duration of the absences. However, research suggests that the cost of absenteeism can be significant. 

Gallup’s State of the Global Workplace: 2022 Report states that unengaged or actively disengaged employees have caused a worldwide loss of $7.8 trillion in productivity. This amounts to approximately 11% of the global GDP. Based on an overall estimate, the missed work across the entire United States workforce is believed to result in a loss of approximately $47.6 billion per year in terms of decreased productivity.

4 ways to prevent absenteeism in the workplace

There are several things that leaders can do to reduce employee absenteeism. Here are some suggestions that may help improve the employee experience. 

1. Clear absence policy

HR professionals can help reduce unscheduled absenteeism, by providing employees with a clear and fair, consistent and compassionate approach to supporting employee attendance. The absenteeism policy should outline the reporting procedures for absences, consequences for unsanctioned absences, and the follow-up process for excessive absenteeism. Consistent enforcement of the policy is also critical to ensure it is taken seriously by employees.

2. Offer flexible work schedules

You can also reduce absenteeism by providing flexible work schedules that help promote work-life balance. Flexible work arrangements, such as telecommuting, flexible hours, and paid time off can help employees manage their personal and work responsibilities and reduce the need for unscheduled absences. Flexible work schedules that allow employees to work from home help employees also reduce commute time which can be a huge source of stress and fatigue. Flexible schedules can improve job satisfaction by giving employees more control over their work schedules and allowing them to work in a way that fits their personal preferences and allows employees to work during their most productive hours and provides them with the flexibility to adjust their schedules when necessary

3. Employee wellness programs

Offering corporate wellness programs such as health and fitness programs that encourage exercise, and healthy eating can help employees improve overall health. Programs that also focus on mental health support like therapy can help address depression, anxiety and burnout that contribute to absenteeism. Wysa is an incredibly useful tool that helps tackle some of these mental health concerns. Providing employees with information and resources on topics such as healthy eating, exercise, and stress management via platforms like Wysa can help employees make informed decisions about their health and well-being. On-site health screenings and vaccinations, such as flu vaccines, can help prevent illness and thus aid in reducing absenteeism. 

4. Improve employee morale and engagement

Improving employee engagement and morale can have a positive impact on managing absenteeism. Employees who are valued and appreciated are more likely to enjoy their work and feel connected to their team and organization. When the work culture provides scope for growth and development by creating opportunities to improve their skills and advance their career it improves employee engagement. When managers and colleagues encourage open communication, they are more likely to feel supported and understood, thus improving their performance. It is important to provide feedback to employees that highlight both areas for improvement and their strengths. Providing constructive guidance and positive reinforcement can help employees to take ownership of their performance and become more committed to their job, thereby decreasing the likelihood of missing work.  

In conclusion

As an employee, it’s important to remember that you are human and sometimes need time off for various reasons. Don’t feel guilty for taking time off when you need it. However, it’s also important to be mindful of your attendance and the impact it can have on your work and colleagues. 

As an employer, creating a healthy work environment and motivating employees is your responsibility. Mitigating employee absenteeism is a long-term process, and you should support your employees and their aspirations. When the necessary steps are taken at the right time, it benefits both the employee and the employer. By following these strategies, you can create a work culture where employees feel valued, engaged, and motivated to show up and do their best.

Photo by Luke Chesser

Photo by Yan KrukauÂ