If you have ever simply observed people at work, you will find that many times they are late or completely absent from work for days on end. We may be able to make a connection in our reasoning that all these people who are 10 minutes late can add up to a huge loss of revenue for the company. The problem is how to handle attendance issues and still treat everyone fairly.
A CCH study of truancy indicates that 83% of employers feel that truancy will continue to increase. The problem is that absenteeism costs have been on the rise, now hovering around $ 800 per employee per year. It doesn’t sound like much, but when this cost is multiplied by 10 or 20 employees, the numbers speak for themselves.
Absenteeism and punctuality policies
Having an absenteeism and punctuality policy is important for any business with employees. Such policies help keep records of time lost from work, encourage employees to attend work, and establish a case for termination when an employee fails to comply with the obligation of his or her terms of employment. The right type of policy can save your business tons of money over the years.
The first thing an owner has to determine is what condition his employees are in. Salaried and professional employees are generally considered “exempt,” while hourly workers are “nonexempt.” Exempt means that employees are not based on their time at work but on their job function. They can work longer hours without paying overtime. Non-exempt employees are paid for every minute they are on the job and are entitled to overtime pay.
Hourly or non-exempt workers may have their pay reduced for any time they miss work while salaried or unless workers are unable to do so. For example, if a salaried worker loses 4 hours a day but works any part of that day, his salary will not be affected. The only time a salaried worker’s salary can be adjusted is when he is on a leave of absence or when he misses an entire day for personal reasons. Punishing the tardiness of a salaried worker by adjusting the salary creates the risk that he will be entitled to overtime.
Support policies vary from company to company and state to state. However, the best assistance policies usually have a progressive component. For example, verbal warning, written warning, suspension, and dismissal would be part of a progressive discipline policy. The other method that could be used is the point system. As the worker receives points for attendance, he will incur more discipline. Once you have reached the threshold, you will be fired.
Using an absenteeism policy that is progressive ensures that all workers are treated fairly. They are warned every time they are disciplined and cannot plead ignorance. Additionally, documentation provided at each level of discipline gives an appearance of professionalism on behalf of the organization and a sense of fairness to the employee.
Salaried workers can be under the same progressive assistance system as an hourly worker. The difference is that their salary cannot be deducted. Once you should also consider that salaried workers should receive notes to file rather than employee advisory (discipline) reports so that their “at will” status is not in jeopardy.
According to the US Bureau of Labor Statistics, a total of 2.8 million work days are lost each year due to illness or injury. Assuming the average worker earns about 40,000 per year, we would add 35% so that benefits come to a total compensation cost of 54,000 per year per employee. If we divide these 54K by 2080 worked in a year, we arrive at a labor cost of $ 25.96 / hour. The absence of a single employee for a day would cost the average company about $ 207.68 per day. So if you have 10 absences a year, your cost would be around $ 2,000. This figure does not include the cost of the actual profit you would have lost by not finishing your products or services.
Methods to reduce absenteeism
1.) No-fault attendance policy
2.) Progressive discipline
3.) Incentives for good attendance.
4.) Make the workplace more fun.
5.) Pre-employment physical and drug exams.
6.) Conduct background investigations before hiring.
7.) Assess the assistance and contribution of each worker.
8.) Attendance must be included as one of the criteria for raises / promotions.
9.) Request medical documentation for all unexcused absences.