Presenteeism V Absenteeism

What is “Presenteeism”?

Why be concerned about presenteeism and what can be done about it?

“Presenteeism” is costing the Irish economy around €1 billion each year, costing roughly 3% of GDP. The phenomenon refers to workers coming to work hung over, turning up without actually working and being accident prone and now may cost the country even more than absenteeism.

A former VHI executive, Paddy Creedon, claims that this is “the unspoken single challenge for corporate in the 21st Century”. Normally "e;s loss of GDP due to alcohol or drugs is measured by absenteeism and illness, however the single greatest loss may be workers turning up at work who cannot function properly.

According to official figures, alcohol-related illness, accidents and absenteeism cost the Irish Exchequer E400m every year.

There is a range of other alcohol related problems that can be clearly demonstrated. Alcohol-related absenteeism and presenteeism are serious problems in workplaces in this country.

“Presenteeism” is a relatively new term that indicates the person may be at work in body but absent in every other sense, due to hangovers. Obviously these issues have important negative consequences for health and safety at work.

Nearly 40 percent of employers surveyed in 2004 by CCH (a provider of human resources and employment law information) report that presenteeism is a problem in their organisation.

Contagious workers can infect other workers. Indeed one study, which asked 25,000 workers about their health status over a two-week period, found that nearly 20percent had experienced a cold or the flu. The Institute for Women"e;s Policy Research has identified studies that show paid sick leave polices reduce the rate of contagious infections in the workplace by isolating sick workers at home; that failure to take time off to regain one"e;s health can actually lead to longer absences because health worsens; and that as an illness spreads within the workplace, additional workers can be affected raising the total employee absence time. Further, workers from one company can infect workers in another. For example, the contagious copier repairperson or computer consultant who visits an office could not only fix the technology but also could affix some germs to the workspace. Thus, an individual employer who takes steps to avoid presenteeism by contagious workers is not fully protected until the community of employers takes similar steps.

Possible measures companies can take to recover or reduce presenteeism costs include providing paid sick days, providing wellness programs, improving co-payments for medical visits and medicines, allowing carry-over of sick days, and improving free medicines (e.g. flu vaccines). Each of these strategies is designed to keep workers healthier through prevention and treatment.

Research highlights on presenteeism?

The costs of presenteeism vary among the 10 conditions analysed in the Cornell study, which were:

ABSENTEEISM

Sickness absence cost Irish businesses €112 million in 2002.

In a recent survey by IBEC, the business and employers organisation, has shown that absence in Irish workplaces is estimated to cost businesses about €1.5 billion a year. According to the report, 14 million workdays are lost due to absence: that is 7.8 days per person employed.

Launching IBEC's detailed Guide to Managing Absence, IBEC Director Brian Geoghegan said: “Absence is a serious social and economic issue. Besides its obvious impact on particular workplaces, absence affects the wider economy through loss of potential output and the increased spend on social security.

Whilst not all absence can be eliminated there is significant room for improvement where absence rates are high, or even at average levels. The IBEC guide will assist employers as it sets out ways of measuring, recording and managing short and long-term absences. It also examines absence with regard to the law, disciplinary procedures and case studies.”

IBEC's survey of 557 organisations, highlights the importance of a corporate absence management policy by which absence is recorded, return to work interviews are conducted in managing short-term absence and occupational health professionals are involved in managing long-term absence.

Absence is defined as 'unscheduled disruption of the work process due to days lost as a result of sickness or any other cause not excused through statutory entitlements (e.g. annual leave, public holidays, maternity leave, parental leave, force majeure or carer's leave) or company approval (e.g. bereavement leave or exam/study leave)'.

According to Brian Geoghegan, the survey revealed:

Companies can no longer afford to tolerate such high levels of absence.

The estimated total annual cost of absence to the economy is in the region of €1.5 billion.

The average number of days lost per employee per annum is 7.8 days or 14 million days for the working population.The average absence rate is 3.4% but almost a third of companies have an absence rate of 4% or more.

Absence rates are higher in manufacturing at 4.4% than in the services sector at 2.5%. Absence rates are highest in large companies: 4.6% for those employing more than 250; 3.7% for those with 50-249 employees and 2.4% for companies with less than 50 staff.

The main cause of short-term absence for both males and females is minor illness. However, almost a quarter of the organisations surveyed stated that many male absences were not due to genuine ill health. Home responsibilities were cited as an important cause of female absence, albeit to a lesser degree than in past surveys.

The two main reasons given for increases in short-term absence levels were:

Some 12% of companies cited alcohol and alcohol related illness as being a cause of short-term absence for males, while the figure is 4% for females. Some 40% of short-term absence occurs around the weekend.

The main reason for the increase in long-term absence was an ageing workforce. An older or ageing workforce brought with it age-related illness such as heart disease and cancer. Long-term absence days (absence lasting more than 20 days) constitute around 42% of all absences. Encouragingly 58% of companies thought it possible to reduce their absence rate.

Managing Attendance

The enormous cost of absenteeism is making employers consider a whole range of options for tackling it, including - in some cases — rewarding attendance.

According to figures released by the CBI, absence from work costs the  £23 billion a year. It will, of course, never be possible to eliminate absence completely: quite a lot of sickness absence is perfectly genuine.

However, there is also a significant amount that is either just simply skiving or “optional” in the sense that it is down to minor ailments that will cause some employees to stay at home while others will shrug the problem off and come into work as usual. It is these two categories, costing Irish organisations 1.5 billion a year that employers are actively trying to reduce.

Various approaches are being used to achieve this objective. An increasing number of employers are using return to work interviews, backed up by improved absence records that enable them to identify patterns of absence, such as staff repeatedly being absent on Mondays or Fridays.

Others are looking at what motivates staff to want to get up in the morning and come to work, especially on those days when they are feeling a bit under the weather. One method of motivating staff is specifically to reward those with good attendance records. This may take the form either of incentives for having no time off over a given period or rewarding the achievement of a figure that is well below the average.

One scheme was originally set up on the basis of entering employees for a prize draw for a new car if they did not take a single day off sick during a 12-month period. The problem with this is that, if an employee does take just one day off early on in the year, there is then no incentive to avoid further time off for the rest of the year.

Although this scheme did, in fact, cut absence rates by 25% in the first year, the decision was subsequently taken to change to a quarterly system, entering all staff with nil absence into a draw for a prize of E1,000 in holiday vouchers.

Where all staff that meets their targets are given a reward, it is better to offer a choice rather than identifying a specific prize. Staff can either be given vouchers to spend in major high-street chains or can be offered a choice of rewards from the catalogues of companies that specialise in employee gifts and incentives.

However, before deciding to implement an attendance reward scheme, employers do need to consider factors such as, for example, whether they really want to encourage staff that has colds or flu bugs to spread them around the workplace. There is also the risk that some kinds of illness may be made worse if employees struggle into work rather than taking time off, with the result that more rather than less absence may be the ultimate outcome.

In certain business sectors, for instance where people work with food, encouraging employees to come to work when they are unwell could actually cause health hazards. Similar considerations could apply to bus and train drivers and to employees who are operating potentially dangerous equipment.

Furthermore, although some employers have reported significant savings as a result of schemes that reward attendance, it is difficult to isolate the effects of these schemes from other factors — the mere fact that the employer is seen to be taking a real interest in reducing absenteeism can be enough to make malingerers more wary of taking those odd days off.

Considerable publicity has recently been given to a pilot scheme introduced by supermarket giant Tesco. In addition to rewarding employees with good attendance records, the company is attempting to eliminate the tendency of some employees to take frequent “sickies” by withholding sickness pay for short-term absence. However, this kind of approach also has its potential hazards.

Whether a stick or a carrot approach is adopted — or some combination of the two — what we are ultimately talking about is staff motivation. Both rewards and penalties can influence the motivation factor, but they should not be used in isolation but rather in combination with a genuine commitment to getting to the root of what actually makes staff want to come to work rather than taking a “sickie”.