Employee absences are a normal part of every business that are not only expected, but also healthy. Whether your employees need a day off because they’re sick, have an appointment, are going on vacation or just need a break, employee days off are vital to both them and your business.
With that said, too many unexpected, repeated or last-minute absences can pose a challenge. After all, a company can’t function properly without adequate staffing to complete the necessary work. Over an extended period of time, these repeated and unplanned absences can negatively impact overall company performance, potentially jeopardizing the health of your business.
Absences & Their Financial Impact
There are several ways that unexpected absences can affect your business’ financial performance over time. Before we can discuss how to prevent these areas of impact, we must understand the underlying issues that require remedying.
Replacement Employees
The cost of excessive absenteeism starts with the cost of replacement employees to cover the absent employee’s shift. This cost isn’t always consistent, often depending on the pay rate of the covering employee, their overtime eligibility and whether the absent employee is taking PTO while gone.
Productivity Loss
Beyond the cost of replacement employees, losses to productivity can also pose an enormous financial burden. A 2015 report from the CDC Foundation focused on productivity losses for employers in the United States. The report estimated that “productivity losses related to personal and family health problems” can cost U.S. employers $1,685 per employee per year, for an estimated $225.8 billion annually. Depending your business size, financial losses due to reduced productivity could greatly impact your company’s revenues.
Administrative
A 2014 report released by the Society for Human Resource Management estimates that supervisors spend an average of 4.2 hours per week managing the ramifications of employee absences. For businesses that operate 50 weeks of the year, that’s equal to 5.3 weeks of just managing the administrative side of employee absences. This includes time spent finding adequate shift replacements, adjusting workflows, providing training for those filling in and more. All of these take time away from other important administrative tasks.
Workflow Disruption
Especially in businesses like retail or customer service, a short-staffed shift can harm the overall customer experience. An inadequate number of employees can be detrimental to service, increasing project completion timelines and causing missed deadlines. Short-staffing can also disrupt the work of other team members whose workloads may increase to make up the difference. Even with someone covering a missed shift, it’s possible that the fill-in is less efficient than the person originally scheduled.
Lower Morale
The decrease in morale may be the most overlooked impact of chronic absenteeism. Stress increases for other employees when they’re constantly required to cover for absent coworkers. Most workers can handle periodic workload increases for short amounts of time, but if the increases are too frequent and intense their morale may plummet. Over time, this can lead to a decrease in efficiency and work quality.
Reducing the Impact of Absences
Now that we have a greater understanding of how continued absences affect your business, we can evaluate which tactics will best allow us to overcome these obstacles.
Implement an Attendance Policy
Instead of waiting until an attendance problem arises, developing and implementing a written attendance policy can proactively deter chronic absenteeism. In the development of the policy, it is important to be crystal clear on definitions. Don’t leave any grey area when it comes to what constitutes a tardy or a no call – no show. Be clear about what corrective actions will be taken and when.
Set and Communicate Clear Expectations
It’s one thing to develop an attendance policy, but clearly communicating that policy and ensuring employee understanding is entirely different. Add a concrete step during your employee onboarding process to share your attendance policy. Tell new hires whom to notify about absences, as well as how to properly notify of an absence. Highlight how their job fits into the team’s success, as well as the impact unplanned absences have on their teammates.
Enforce the Policy Consistently
Inconsistent policy enforcement is just as damaging to attendance as having no policy at all. Selective or inconsistent policy application lends itself to potential problems with favoritism, among other issues with attendance and company culture. Remember that enforcing your attendance policy doesn’t mean that you shouldn’t extend compassion and understanding when personal emergencies arise. The policy itself should include flexibility for emergency situations before an emergency arises.
Train Your Supervisors
Front-line supervisors respond to attendance issues on a daily basis, yet many companies provide them with little training in handling these issues effectively. Make sure that your supervisors understand your company’s attendance policy, in how it relates to both them and their teams. If you provide them with the necessary tools for properly communicating with employees when attendance issues arise, they’ll be able to handle those issues in a professional, effective manner.
Monitor Employee Attendance
Tracking ongoing employee attendance is key to reducing the effects of unplanned absences. If an employee’s inconsistent attendance is creating a problem, we can’t address it until we understand the problem’s scope and nature. Keeping accurate, detailed records of employee attendance is critical to finding and addressing troublesome patterns.
Reward Good Attendance
When monitoring employee attendance, it’s easy to solely focus on the “problem areas,” but rewarding desirable behavior is also important for encouraging good employee attendance. Some companies choose to provide recognition and rewards for employees with good attendance, often finding that doing so is one of the best low-cost-high-impact activities for their company.
In Conclusion
When excessive absenteeism puts your bottom line at risk through decreased productivity, poor employee morale and mediocre customer service, you can implement tactics to assuage some of the damage. While these tactics won’t eliminate all issues, the right set of tools and strategies can help your team prepare for, and mitigate, some of the negative effects of employee absences.
