Transcript ABSENTEEISM COSTS (19 Figures)

Absenteeism “Facts”
Paid absences are not universal
● 22% of FT and 74% of PT U.S. employees do not
receive paid sick leave (2015). ~50% of small businesses
● Iowa: 33% of FT and 81% of PT employees have no
paid sick leave
However, new state & city laws suggest change
● Firms > 50, CT, DC and CA require 5-6 paid sick
days.
● Cities mandating: San Francisco, Seattle, Portland,
New York City
Absenteeism “Facts”
Financial cost estimates are highly variable as
“paid leave costs” can entail vacation
● Absenteeism costs range from 1% of payroll (U.S.
Dept. of Labor, 2015) to 15% (Kuzmits & Adams
2009). Health care higher due to higher absences.
Can necessitate temporary or surplus employees,
affect customer service
Shareholders/Boards of Directors expect control
Absenteeism Issues
What is excessive? Multiple metrics:
• Number of sick days used
- Dept. of Labor: Mean is 8 days
- Iowa data suggests people use half
• Changes in absence rates (Hours absent as a
percent of hours usually worked)
Range: 1.9% in 2003 to 3.1% in 2008; 2.9% 2014
Tends to be lower in bad economic times, higher in good
times; higher in public sector (4%) than in private
sector (3%). > 3% usually viewed as excessive
ABSENTEEISM COSTS
(lower level employee)
1. Salary ($13.49/hour)
$107.86
2. Benefits
30.42
3. Replacement employee
(cross-training, temp help, supervision,
overtime)
4. Unabsorbed burden
(unused equipment, rent, light, in-efficient
use of materials)
5. Loss profit contribution (value added)
11.08
73.30
88.51
$311.16
Focus: Managing Voluntary Absenteeism
• Determining what % of
absence is voluntary
(avoidable/motivational)
and what is non-voluntary
(due to inability) is tricky
• Experts believe ~40% is
voluntary and ~ 60% is
non-voluntary*
•40% may be the “max”
managers can affect (a
restriction in range)
• Managers disagree as to
what is a valid excuse
*Navarro & Bass (2006) report 35% of absence due to personal illness, 21% family issues
Summarizing: What is an Excused Absence?
• May be contingent on empowerment (discretion) of
supervisors
•Absence policies remain ambiguous
a. Personal/dependent illness
b. Gray areas: relative illness, business affairs,
lack of transportation, “domestic maintenance”
c. Truly discretionary: take a day off, wedding,
special event
Summarizing: Separating Voluntary &
Nonvoluntary Absence
•Explains popularity of PTO (Paid Time Off) and “no
fault” absence policies. SHRM: 33% of firms in
1997, 51% of firms in 2012
•2014 norms: 29% private industry workers covered
by “consolidated leave plans”. Average 23 days/year
after 10 years of service
•Recordkeeping time frames dependent on magnitude
of the problem (from no tracking to yearly, to
quarterly, to monthly)
Absenteeism Measures
S
1
8
15
22
February
M T W TH F
2 3 4 5 6
9 10 11 12 13
16 17 18 19 20
23 24 25 26 27
S
7
14
21
28
1. Frequency Measure: total # of times/period absent ( 4)
2. Severity Measure:
March
1 2 3 4
8 9 10 11
15 16 17 18
22 23 24 25
29 30 31
5
12
19
26
6
13
20
27
7
14
21
28
April
1 2 3
5 6 7 8 9 10
12 13 14 15 16 17
19 20 21 22 23 24
26 27 28 29 30
( 7)
3. Attitudinal Measure: Frequency of 1 day absences (2)
4. Medical Measure:
4
11
18
25
total # of days/period
(most common)
5. Worst Day:
Frequency of > 3 day absences (1)
# people absent on any given
day (e.g., Monday)
Model of Employee Absenteeism
3. Personal Characteristics
-Education
-Sex/Family
-Org. tenure
responsibility
-Age (also depends
-Family size
on sex)
-Personality
2. Recruitment + Selection
Job expectations about
Attendance
1. Job Situation
-Job autonomy
-Job level
-Work group size
-Role Stress
-Considerate
leadership style
-Coworker
relationships
-Scheduling
(flexible, rotating)
4. Job Attitudes
-Job satisfaction
-Organ.commitment
-Job involvement
7. Ability to Attend
-Health (Depression, pain
cardio fitness, smoking,
drug use)
-Illness & accidents
-Family responsibilities
-Transportation problems
-Travel distance
6. Attendance
Motivation
5. Pressures to Attend
-Economic/market conditions
-Human Resource Practices
(incentives, control policies)
-Work group norms/culture
-Profit sharing/employee
share ownership
8.Employee
Absenteeism
(Attendance)
Review of Absenteeism Model
• Box 8: Employee Absenteeism or Attendance
• Box 1: Job Situation
↑ Job autonomy → ↓ Absenteeism
• Box 2: Recruitment and Selection
• Box 3: Personal Characteristics
• Box 4: Job Attitudes
• Box 5: Pressures to Attend (next slide)
Personal Characteristics (Box 3)
• Education: No consistent pattern.
• Org tenure: ↑ Tenure → ↓ Absenteeism
• Age: Younger more short term; older more long term.
Age/sex: Men: ↑ Age → ↓ Absenteeism
Women: No relationship
• Family responsibility: Parental status and elder care
issues (by 2020 1 in 3 will have the latter; boxes 3 & 7)
• Family Size: ↑ Size →
↑ Absenteeism
Personality
(Box 3)
• ↑ Conscientiousness → ↓ Absenteeism
• ↑ Extroversion → ↑ Absenteeism
• ↑ Anxiety/depression → ↑ Absenteeism
Human Resource Practices for Managing
Absenteeism (Box 5)
• Review incentive
systems like lotteries
(nurse example)
• Be willing to modify
practices over time
• Determine whether
cost/benefit of
incentives are
consistent with
organizational culture
Human Resource Practices for Managing
Absenteeism (Box 5 continued)
• Work group norms and
culture
• Profit sharing; employee
ownership
Family Responsibilities: Examples of Costs
Associated with Eldercare
● Absenteeism
● Workday interruptions
● Going part-time
● Eldercare crisis
● Supervisor time
● Taking unpaid leave
● Replacing the 9% of workers who quit
Solutions: subsidizing in-home care for
employee’s dependent, referral services to
caregivers and nursing homes, providing
extended leaves of absence.
Be “employee need specific”: Japanese heartache leave
RECOMMENDATIONS FOR INCREASED
UNDERSTANDING OF ABSENTEEISM
1. Use standardized measures and time frames
2. Study attendance
3. Study white collar absenteeism
4. Examine how other HR practices affect absenteeism
(next 2 slides)
5. Encourage health
6. Engage in more creative thought
Effects of Various Human Resource Practices on
Reducing Absenteeism
Method
# of Studies
Effect
4
High
10
High
Well Pay (unused sick leave)
Flextime
Compressed work schedules
5
Medium
12
Medium
Recognition
6
Medium
Wellness programs
6
Low
Other financial incentives (bonus)
7
Low
Games
6
Low
Profit sharing/employee ownership
3
Medium
Team/group reward systems
??
???
PTOs, time-off banks
??
???
Discipline
Effects of Various Human Resource Practices on
Reducing Absenteeism: HR Professionals
Method
% of Companies Effectiveness
using in 2007 (1-5 very effective)
Well Pay (Buy back unused sick leave)
53
3.4
Verification of illness
74
3.2
No-fault
59
2.9
Disciplinary action
89
3.4
Personal recognition
57
2.6
Part of yearly performance review
82
2.9
Bonus
51
3.3
Paid-leave banks (PTO) *
60
3.6
Adapted from CCH, www,cch.coom/preess/news/2007
*PTO may not decrease absenteeism, just make it more planned.
PRACTICAL STRATEGIES FOR
REDUCING ABSENTEEISM
1. Increase job satisfaction/autonomy via
a. Job redesign c. Decreased stress
b. Supervision d. Flexible schedules
2. Use motivation strategies more frequently and creatively
a. Operant conditioning
b. Goal setting
3. Use work group dynamics
a. Small groups
b. Promote attendance norm; tie to rewards?
Readings
•
•
•
•
Navarro & Bass
Kuzmits & Adams
Johns
Judge et al.
Readings
• What were your “take-aways” from Navarro
& Bass?
Kuzmits & Adams (2009)
• What were the key parts of a no-fault
absence system?
• Summarize the study setting and
research design
• What were the major findings?
• How generalizable are these results?
Johns Article
• Employees & managers estimate absenteeism
inaccurately. Why?
• Under-reporting tendency noted in 9
hypotheses, suggesting bias extends to group
level
• What was the sample and attendance policy?
• Review Table 1 to understand why there are
two sets of data and Hyp. 4
Johns Article
• What did the partial replication show?
• Implications: People under-report absenteeism
extensively. Are they deliberately lying? How
can the under-reporting tendency be
addressed?
• Is self-serving bias evident in non-western
societies?
• Though no actual absence data, yes. Stronger
at group level among Chinese managers
Mean
Days
Absent
9
Results: Hyp. 1, 2, 3, 6, 7 & 8 and Partial Replication
8.83
School Teachers
8
8.36
7
7.47
7.31
6.21
6
H1
5
H6
Utility Employees
{
5.91
H7
4
{
H3
H2
3.65
3.22
3
H8 (ns)
Utility Managers
3.31
2
1
Occupational Norm
Figure 1.
Group
Self
Actual
Estimates
Report
Absence
Absence Measure
Mean days absent (estimated or actual) for three samples.
Judge et al. (1997)
•Relates “”Big Five” to absenteeism. Move
beyond situational causes of absenteeism to
dispositional one which might be usable at the
time of selection
•How is each trait hypothesized to be related to
absence behavior?
•What does Hyp. #4, stating that absence
history will mediate the relationship between
personality and absence mean?
Research Model: Judge et al. 1997
Personality
Traits
Absence
Proneness
Absenteeism
T1
“Mediator”
T2
T3
Judge et al. (1997)
•What was the sample and response rate?
•How were personality, absence proneness, and
absence behavior measured?
•Were Hypotheses 1-3 supported? Table 2
•Was Hypothesis #4 supported? Table 3
•In what ways, if any, could you use this
information in the selection process?