Absence Management PDF Print E-mail

 

How much is the “flu” costing you?


The cost of employees is usually the largest item on the balance sheet of most organisations. Sadly, much of that cost is wasted through risks and losses which could be controlled.


Recent reports from both the Institute of Personnel & Development, and the Confederation of British Industry suggest that the average level of sickness absence in the UK costs employers around £465 per employee per year.


This figure merely reflects the direct costs of absence ie sick pay, overtime payments and replacement staff. If lost productivity, administration time, employers liability settlements and so on are taken into account, this figure could quite easily be multiplied by a factor of four. Based on these figures, an organisation employing 50 individuals could conceivably be facing costs in excess of £75,000 per year, solely through absenteeism.


The Isle of Man has a tight labour market, and it is quite conceivable that these illustrated costs could be higher. The reputation of the business could also be put under constant strain, with the real possibility of eroding the commercial base upon which it relies.


Whilst some larger organisations may have access to expertise to help minimise the financial and reputational consequences of absenteeism, it is likely that the large majority of businesses would need to seek independent advice to help combat these difficulties. This would provide analysis of the extent of the problem, and quite probably offer a range of solutions designed to produce real, and most importantly, measurable results. Any initial analysis should take the form of an audit process which would identify the underlying causes behind an organisation’s sickness absence, and should also provide benchmarks against other comparable employers.


Most importantly, the audit would identify those areas in which absence intervention would be cost effective. These could range from management training to rehabilitation of long term absentees. In some cases, progress can be handicapped by a lack of measurement and analysis of the problem. This could be alleviated by the installation of absence management processes to give the basis for setting targets and reviewing progress.


The results of the audit would generally be presented as an “Absence Profile”, which will be unique to each organisation, and will give an immediate insight into absence performance. Various “key indicators” could be identified, and these would be rated and compared with the practice of comparable organisations, as well as current best practice.

Once the absence drivers have been identified, work could begin on an action programme. This aims to achieve the highest possible reduction in absence levels which are comparable with the culture of the organisation, and which would be highly cost effective.


Whilst programmes of this nature are designed as risk management interventions to reduce the cost of absence, they can also be seen as employee benefits. Employees are likely to appreciate not only the commitment to their health shown by their employer, but also to appreciate the commitment made to providing a less disruptive working environment.

In conclusion, absence management should be treated as a real risk priority, and a programme should be considered which addresses real business issues, and which will deliver major cost savings. The benefits will be felt by both the employer, with a fitter and more productive workforce, together with significant cost reductions, and the employees, with improved health and enhanced morale.

 

H & H Consulting


Cronk Beg

Ballagawne Road

Colby

Isle of Man

IM9 4AZ

 

Tel: 07624 493844

 

E-mail:  This e-mail address is being protected from spambots. You need JavaScript enabled to view it

 

Web: www.handhconsulting.co.im