Client Articles

Client Articles | Issue 15

With the Coalition Government's WorkChoices legislation making sick leave negotiable in exchange for other benefits, it is important for HR Practitioners to understand the real impact of sick leave as part of a total employee benefits package.

Definitions, Statistics and Calculations

Absenteeism can be broadly defined as "the frequent, habitual or chronic absence from work or other duties without good reason"[3].

While perfect attendance does not guarantee maximum productivity, and we can all think of employees who turn up to work when obviously sick and perform below their best (a phenomena now called 'presenteeism'), 'absentees' are those who, for a variety of reasons, use their sick leave entitlements and more (e.g. parent, carer's and compassionate leave) on a regular basis.

The recent findings of longitudinal studies on absenteeism rates indicate that as a trend it is on the rise. In the US, CCH's 16th Annual Unscheduled Absence Survey had absenteeism at its highest rate in almost ten years[4]. A recent Australian study reported 56% of employees taking sick leave for reasons other than illness, up 13% since its previous survey, with an estimated cost to the Australian economy of $18 Billion per year[5], up from $7 Billion in 1990[6]. Absenteeism is also estimated to cost Australian employers 2% of GDP[7].

Causes of Absenteeism

Absenteeism can be the result of either or both of two interdependent dynamics:

1. Organisational Factors; and
2. Individual Behaviours.

1. Organisational Factors:

Many factors that contribute to staff absence are beyond an employer's direct control. Therefore, it is vital that employers do everything within their power to positively influence their staff towards 'anti-absenteeism'.

Organisational absenteeism factors can be either direct or indirect. The following list is not exhaustive, but attempts to highlight the most obvious/prevalent factors[8]:

Direct:

a) No clear policies for absence management
b) Absenteeism monitoring is the responsibility of line management only
c) Higher sick leave entitlements than average
d) Lack of supportive work-life programs
e) An ageing workforce (with increasing health issues)
f) A prevailing view that employees are 'entitled' to take unused sick leave[9]

Indirect:

a) Fear of layoff/high staff turnover (i.e. staff actively looking for employment elsewhere)
b) Job dissatisfaction (e.g. Low chance of advancement or promotion)
c) Office politics/competition/staff conflicts
d) Excessive time required away from family
e) Excessive workload (especially if perceived as unfair or irrelevant)
f) Personal problems outside of the workplace.

2. Individual Behaviours:

It is true that some absenteeism is due to staff actively abusing sick-leave benefits. However a deeper analysis would show that their absenteeism was as a result of either one or a combination of factors listed below, in varying degrees of intensity:

a) Illness. About 30% of absenteeism can be attributed to individual's own ill health or physical disability[10]. An illness can range from a recurring 24 hour stomach bug (e.g. influenza alone currently costs 1 million lost sick days in Australia per year[11]) to chronic conditions requiring regular treatment during work hours.

b) Stress. According to the National Health and Safety Commission, work-related stress accounts for the longest stretches of absenteeism[12]. The symptoms of work-related stress are well known and documented. Whether caused by organisational or individual factors, compensation claims for stress are among the most costly for employers[13]. They are currently running at $200 Million per year. Recent medical discoveries from Australia's Garvan Institute have now scientifically connected high stress levels to illness and obesity[14].

c) Depression. With up to 1 in 5 people expected to suffer from a depressive illness in their lifetime, over half a million working days every month are lost to depression[15].

d) Alcohol. A 2001Medical Journal of Australia Study calculated alcohol-related absenteeism (including injuries and illness) at 7,402,301 days and $1.2 Billion[16].

e) Obesity. 3.2 Million Australians are classified as obese, contributing $3.8 Billion in lost productivity and direct health costs[17]. Unhealthy employees take up to nine times more sick leave than their healthy colleagues[18].

What is immediately apparent is that the real cause of absenteeism for each individual worker can be a highly complex combination of any (or more) of these factors listed above. It is also evident that even the very best and most productive workers can sometimes become absentees through no direct fault of their own. The challenge for HR departments is to develop strategies that positively address all types of absenteeism.

Addressing Absenteeism

When planning to tackle absenteeism, the key is to develop programs that allow you to target habitual offenders and transition them up or out, in as fair and reasonable way as possible. A long term vision to aspire to is the creation of a supportive culture for all, that does not tolerate unapproved (non-medically or otherwise) absenteeism.

The starting point is to take a positive view of your employees. If your first assumption is that your staff would rather be at home than at work, you are not treating people as responsible adults.
Reasonable rules work far better than threatened compliance. The minority of employees who have absentee problems should be handled individually, firmly and fairly.

The development of an absence management policy is critical to fixing chronic absentee problems. According to Dr Stefani Yorges, a specialist in staff absenteeism, turnover and withdrawal behaviours, the following elements are essential and must be addressed[19]:

1. The organisation's approach to absence

• principles - fairness and consistency
  
• position - low tolerance of unauthorised absence, high levels of support for genuinely ill employees
  
• objective - to create and promote a positive and healthy workforce, to specify an absence target rate
  
• organisational services - Employee Assistance Program (EAPs), counselling services, rehabilitation and re-integration programs which initiate and maintain regular and consistent contact with potential absentees
  
• the definition and measurement of absence .
  

2. Notification procedures for employees who are out sick

• who to notify
  
• when to notify
  
• how to notify (eg. is a text message really acceptable?)
  
• when to obtain medical certification (e.g., sick absence of three working days or more).
  

3. The role of the supervisor with responsibility for the recording of absence

• absence recording requirements, including documentation
  
• conducting return-to-work interviews
  
• a level of discretion available to the supervisor to deal with absence.

4. Disciplinary processes and procedures

• These must be in accordance with the relevant legislation in your state and territory, but tailored to your specific workplace needs and requirements.
  

With this foundation in place, it is possible to then look at introducing current trends such as corporate wellbeing programs to further enhance your workplace as a positive place to be.

Conclusion

When it comes to absenteeism, the old cliché' holds true: an investment in prevention is worth far more than the cost of the cure. Addressing the direct and indirect organisational factors that contribute to absence management must be your starting point. A fair and principled system of absence management, consistently applied, will lay the foundation for changing a culture that is suffering negatively from absenteeism.

You can offer as many free massages, stress management/meditation sessions, and the most flexible paid time-off policies available, but these must be clearly seen as the icing on a well-made cake. Until people know that any absence from work will always be dealt with fairly and justly, you may own their backs, but you will find it hard to win their hearts.

About This Article:
	© 2007. All rights reserved.
	This article was licenced by Apsley Recruitment for the Apsley Recruitment client newsletter.
	Article Written by Victoria Small and Paul Quinn, Quinntessential Marketing Consulting Pty Ltd. Disclaimer: The views and opinions expressed in this document are those of the author and do not necessarily reflect the view of Apsley Recruitment Pty Ltd. You should not use this information as the sole basis for decisions or in place of professional advice.

Resources:

1. Yorges, Dr. Stefani: Absenteeism: Is 10% Causing 90% of Your Problem? www.refresher.com 2. ACTU Cached Website: The History of Sick Leave www.actu.asn.au/public/library/sick.html+sick+leave+australian+history&hl=en&ct=clnk&cd=2 3. Absenteeism Definitions http://www.medterms.com/script/main/art.asp?articlekey=40527 http://cancerweb.ncl.ac.uk/cgi-bin/omd?query=absenteeism&action=Search+OMD http://dictionary.reference.com/browse/absenteeism 4. CCH 2006 Absenteeism Survey http://onlinestore.cch.com/default.asp?ProductID=4385&CampaignID=Y5445-FPOS 5. Hallis 2007 Workplace Survey Media Release http://www.hallis.com.au/research_surveys/Media%20Release%20-%204th%20April%202007.pdf 6. Wooden, Mark: The Cost of Time Off Work in Australia: Asia Pacific Journal of HR - Vol 30, No. 3 (1993) National Institute of Labour Studies, Flinders Uni of SA (cites $7 Billion in 1990) http://apj.sagepub.com/cgi/content/abstract/30/3/1 7. Foundation 49 http://www.49.com.au/index.php?option=com_content&task=view&id=83&Itemid=70 8. Yorges, Dr. Stefani: Absenteeism: Is 10% Causing 90% of Your Problem? www.refresher.com/asfyabsence.html+Absenteeism:+Is+10%25+Causing+90%25+of+Your+Problem%3F&hl=en&ct=clnk&cd=1&gl=au 9. Otto, Diane Mines 2002 Absenteeism Research Abstract http://www.mines.unsw.edu.au/Publications/abstracts/OttoDianne_2002.pdf 10. Eureka Alert! (Science News PR Website) - Further Garvan Research Data http://www.eurekalert.org/pub_releases/2005-12/ra-sre112905.php 11. Health for Industry Absenteeism Management http://www.hfi.com.au/services/absenteeism_management.html 12. Life Orientations - Workplace Statistics http://www.lifo.com.au/index.php?module=pagesetter&func=viewpub&tid=2&pid=13 13. Reducing Stress at Work - Australian Human Resources Magazine, May 2007 http://www.humanresourcesmagazine.com.au/articles/B7/0C04BAB7.asp?Type=60&Category=1685 14. ABC Innovations Interview - Stress & Illness http://www.abc.net.au/ra/innovations/stories/s1601716.htm Garvan Institute Stress & Obesity http://www.garvan.org.au/files/Institute-Science/PR14Stress_obesity_distribute.pdf 15. Depression > Absenteeism Link http://www.beyondblue.org.au/index.aspx?link_id=9 16. Medical Journal of Australia - Estimating the Costs of Employee Absenteeism http://mja.com.au/public/issues/185_11_041206/pid10456_fm.pdf 17.Foundation 49 http://www.49.com.au/index.php?option=com_content&task=view&id=83&Itemid=70 18. The Health of Australia's Workforce: Medibank Private Report, 2005 http://www.medibank.com.au/pdfs/MEDI_Workplace_Web_Sp.pdf 19. Yorges, Dr. Stefani: Absenteeism: Is 10% Causing 90% of Your Problem? www.refresher.com/asfyabsence.html+Absenteeism:+Is+10%25+Causing+90%25+of+Your+Problem%3F&hl=en&ct=clnk&cd=1&gl=au Other sources: Better Health Channel - Workplace Stress Symptoms http://www.betterhealthchannel.com.au/bhcv2/bhcpdf.nsf/ByPDF/Work-related_stress/$File/Work-related_stress.pdf PWC Legal Article - Workplace Stress http://www.pwclegal.com.au/legal/pwclegal.nsf/pages/fbf63a2b5b388aa1ca25706600126c81