Life is unpredictable, and sometimes injury, family emergency or illness can result in unplanned absences from work. This can look like a last-minute phone call or a no-show. However, employee absences are expensive, especially when these absences start to pile up. “Absenteeism” is a pattern of frequent, unexpected, and habitual absences and it is full of hidden costs.
Managing employee absences, especially when they begin to appear in excess, is essential to reduce the damage of these hidden costs on your company. Managing attendance can also provide insights that enable you to improve productivity and employee experience significantly.
What are Absences Costing You?
Understanding the importance of employee attendance management begins with learning where and how employee absences are taking a toll on your company.
Loss In Productivity
Forbes estimated that unplanned absenteeism costs exceed a staggering $600 billion a year. When tasks require the ability to communicate and collaborate with your missing team member, you lose productivity. Additionally, if management has to coordinate another employee to cover a shift and does not have a time and attendance program that makes this easier, this can be a big time waster.
Overtime
When an employee has an unplanned absence, finding another employee to cover their shift can result in the covering employee accruing overtime hours. This is another major financial expense, as time and a half pay adds up quickly. Employee absences account for 20%-47% of company overtime. Time and attendance tracking helps management balance the spread of employees who cover shifts and those employees that might rack up overtime hours.
Compliance Issues
Without proper management, replacement employee scheduling can put your company at risk of violating overtime rules. The DOL’s new overtime compensation rule is currently set to take effect on July 1, 2024.
With this adjustment to the rule, it is especially pertinent to have a trusted time and attendance tracking system to manage employee absences and overtime. Proper management also prevents infringement on union agreements, local law and coverage requirements.
Employee Morale
Employee absences also cost employee morale. It can be frustrating for everyone involved when chronically absent employees create stress for the rest of the team. When employees feel overworked, are habitually getting stuck on projects from missing their team members and the administration is wasting time to find replacements, morale and quality of work can plummet. Low morale may also encourage further employee absenteeism, functioning as a feedback loop.
Insights are your Friend
Proper management provides essential insight to company improvement.
Absence Policies
It’s important for management and employees to operate from the same rule book. This way, employees know what policies they have to follow and what the consequences of breaking these policies will be, and management can enforce the policies equally. All parties share the same expectations. Attendance policies in combination with employee attendance tracking guide management on when to take communicative and disciplinary action.
Healthy Communication
Beyond injury and illness, there are many other reasons underlying employee absences. An article on Indeed listed common reasons as mental health, childcare or eldercare, low morale, disengagement, and harassment. Other absenteeism issues could revolve around lacking transportation to and from work.
Encouraging open conversations with employees who are chronically absent may reveal issues within your organization to address through internal changes or by connecting your employees to other organizations that can help.
Absences due to mental health were up by 33% in 2023. For employers struggling with mental health-related absenteeism in their workplace, this may be an opportunity to connect with external partnership programs or make internal changes (like creating a wellness program) to help improve the employee experience at your organization while also addressing an absenteeism cause.
Analyze & Combat Trends
Keeping track of time and attendance also allows you to keep an eye on absenteeism trends. For example, if there is a spike in absences during February, a month when sunlight and temperatures are lower, this insight could allow you to combat absenteeism by investing in additional lights or plants, or creating incentives or rewards to encourage coming to work when employees are more inclined to stay home.
Productivity and a Healthy Work Culture Depend on Absence Management
Quality absence management prevents financial loss, overtime law infringement and dips in morale while also opening up healthy communication and providing helpful insight to improve your company and find fruitful external partnerships to provide employees with quality resources.
For a simple time and attendance solution that automates absence management, provides tools for management and employees to make scheduling easier and accurately enforces your policies, click the link below.
