What Is Employee Absenteeism and What You Can Do About It

Absenteeism happens when an employee starts missing work frequently or doesn’t keep to their contracted number of hours. Absenteeism can become a disruptive force in the workplace – it can be costly for employers and inconvenient for co-workers. This holds true for both full-time and shift-based workers.

For decades, absenteeism in the workplace has been an issue for employers, but it’s seen a spike over the last two years. In fact, since the start of the Covid-19 pandemic, there were several months when absenteeism in the US was significantly higher than expected. 

 All of us miss a day of work now and again due to illness or a personal emergency, but absenteeism becomes an issue when it happens over and over again.

In this article, we’ll explore the impact of employee absenteeism on businesses, why excessive absenteeism occurs, and ways you can ensure that it doesn’t become an unmanageable problem in your organization.

Absenteeism’s Effect on the Workplace

When your employees are frequently absent from work, it can affect your business’s bottom line.

Absenteeism can also result in lost productivity and profitability if employees with specific roles aren’t present. Companies that have high levels of absenteeism also typically see an increase in labor costs. This is partly due to increased overtime pay or a need to hire contractors to fill the gap created by absent workers.

Managers are also negatively affected due to the additional burden of allocating and overseeing projects.

Work environments where absenteeism is rife aren’t fun or fair for those who show up for work on time, every time. If left unchecked, workplace absenteeism can be a source of low morale among co-workers and lead to conflict or diminished team productivity.

Next, let’s consider some of the major causes of absenteeism.

10 Common Causes of Absenteeism

1. Sick Leave

Employees take sick leave when they fall ill or in the unfortunate event of an accident. Many organizations grant their workers a certain number of approved, paid sick leave days every year. In most cases, these absences need to be verified through the presentation of a doctor’s note.

2. Family Issues

There are times when employees struggle with family matters, for example, a death in the family or a divorce. Often, this makes it difficult for them to face coming to work. Other family issues can crop up and cause unplanned absences, such as an urgent matter at a child’s school or childcare issues.

Some companies offer employees onsite childcare and justify the cost in terms of increased attendance of their workers. However, this isn’t a solution within reach of all employers and employees.

3. Personal Issues

Other personal issues such as alcohol and drug abuse can result in a person taking unauthorized or unscheduled time off. Such individuals are also generally more prone to be involved in accidents or suffer injuries and other illnesses.

Money problems can also cause health problems, especially if someone can’t afford to go to a hospital in an emergency or if the stress leads to high blood pressure.

4. Mental Illness and Depression

Mental health problems and depression are major causes of absenteeism in the US workforce.

Sadly, it’s not uncommon for these conditions to lead individuals to turn to alcohol or drugs, making their absences from the workplace even more frequent.

5. Disengagement and Bullying

Employees who feel bored or frustrated in their jobs are likely to become apathetic and disengaged. This could be because they don’t feel challenged in their role. Sometimes disengagement surfaces when an employee experiences conflict with a co-worker or manager. Passive disengagement can occur if issues like financial problems or family disputes become persistent.

Bullying is another factor that can result in excessive absenteeism. According to the Workplace Bullying Institute, overall, workplace bullying incidents are on the rise. 30% of workers in 2021 claim to be victims of workplace bullying, compared to 19% in 2017.

6. No Flexibility

If people feel that their employer is inflexible and doesn’t allow them to manage their schedules and timekeeping, they might rebel by coming in late or taking extended breaks.

For this reason, micromanagement approaches should be avoided.

7. Age

The age of your workforce can also impact your absenteeism levels.

Older people are more prone to experience health-related absences due to their heightened risk of chronic conditions.

8. Lack of Motivation

Conflict in the workplace among individuals, managers, and teams can impact people’s motivation levels negatively.

Similarly, if there’s a toxic workplace culture or an employee fundamentally disagrees with their company’s decisions, their motivation levels can quickly plummet.

9. Stress

Stress can have physical and emotional symptoms that impact people’s work performance and attendance records. Physical manifestations of stress include stomach problems, fatigue, and headaches. Emotional reactions include irritability and anxiety.

Stress can have many sources – it can result from prolonged family, financial, or health issues or simply a demanding job function. In the US, over 11 million workdays are lost due to employee stress every year.

10. Heavy Workload

As we touched on in the point above, a heavy workload, a fast-paced environment, or multiple conflicting deadlines can sometimes make people feel overwhelmed and stressed out.

When this level of pressure is consistent, it can result in people taking unscheduled time off to try to recover and recharge.

Employee Absenteeism and Its Costs

Absenteeism can become a serious problem for a company if an employee or employees are repeatedly absent. This is especially true if these individuals are still paid while they’re absent. Additionally, absenteeism can become an issue if a person goes missing during a critical project or other busy times during the year. When this happens, it falls to other team members to step in, which can cause feelings of anger or resentment.

Safety issues can also arise if co-workers without the proper training are required to fill in for absent colleagues.

How to Handle Absenteeism Problems – 7 Solutions

Given the significant cost and impact of workplace absenteeism, managing it is essential. There are many practical steps that managers and HR teams can put in place to address it.

Here are some ideas to consider:

1. Establish an Attendance Policy

Establishing and communicating an attendance policy is the first step in ensuring that workplace absenteeism doesn’t become an issue in your organization. This policy should include things like who the employee should contact in an unscheduled or unforeseen absence. It should also give clear guidance on matters such as how to clock in and out and how to record and request absences.

Your policy should also provide details regarding the disciplinary actions that could be taken in the event of unexcused or excessive absenteeism. Ask your HR team to ensure that the conditions of this policy are thoroughly explained to new hires as part of the onboarding process. They should also ensure that all employees sign the document and acknowledge the rules. The policy should be reviewed regularly and revised as needed.

Additionally, why not reward and incentivize good attendance and punctuality? Consider setting up a system for rewarding employees who maintain an excellent attendance record. It doesn’t have to cost you a lot of money. Small gifts, vouchers, or free lunches are simple yet effective ways to let your people know you appreciate them respecting your time and attendance rules.

2. Workplace Health Promotion, Employee Assistance Programs, and Workplace Wellness Programs

Workplace Health Programs (WHPs) can go a long way in reducing the instances of illness in your workforce, thereby curbing absenteeism levels. An example of such a program is an alcohol consumption reduction program.

Employee Assistance Programs (EAPs) are interventions aimed to support and rehabilitate employees who are suffering physical, emotional, or mental health problems.

Today, over 75% of employers offer some kind of Employee or Workplace Wellness Programs (EWPs) to their employees, and for a good reason. Employee wellness programs, specifically fitness and health programs, also reduce health costs in the long run. Financial wellness programs can take the form of Earned Wage Access, offering paid sick leave or even financial goal setting. Whatever you can do to alleviate your employees’ financial burdens can go a long way.

Other benefits of WHP, EAP, and WWP programs are that they send a message to both existing and prospective employees that the company cares about them and has their best interests at heart.

3. Engage Your People

Workplace absenteeism levels can start to creep up if people feel they’re just a small cog in a large machine, invisible to their management. Find ways to address this. Approaches will vary by business – some find it easy to host meetings and town halls, but others with widely spread staff in the retail or hospitality sector will find it more difficult. Others implement cutting-edge communication platforms to engage with their deskless workers by providing company announcements, training them, and more. In addition, you can also update employees on how well the business is doing.

When not using communication platforms, try to engage with your employees face to face where you can. It’ll help you better understand their problems working at the coalface. The feeling that your employees will have, knowing that they matter as individuals, will pay significant dividends at a time when you might need their loyalty.

You can also post information regularly on the intranet and in employee rest areas, so they can see what’s going on around them. Remember that staff may not have access to a company PC – so make sure they have a way to access this information from their smartphone or PC at home.

4. Health Screenings

Many employers offer to fully or partly sponsor the cost of regular health screenings for conditions such as high blood pressure and diabetes. These health checks allow problems to be picked up on before they become dangerous, improve overall employee wellness, and reduce absenteeism.

5. More Flexibility

For hourly workers, giving employees the option to schedule shifts can be a useful tactic in reducing absenteeism. This is particularly helpful when an employee has an unplanned or last-minute childcare or transport issue to attend to, for example.

As the employer, why not make it easy for them? Consider investing in an application that allows workers to reschedule shifts or even pick up extra shifts using their smartphones. This gives your staff the flexibility they value without it becoming a headache for managers trying to keep tabs on their employees and manage their shifts. This capability is much prized by employees at organizations that use Payactiv’s service.

Offering payment flexibility is one approach that’s growing in popularity among employers and employees alike. Specifically, Earned Wage Access (EWA) services are an increasingly common element of benefits packages. Essentially, EWA allows employees to access pay they’ve accrued but not yet received.

EWA services can help alleviate sudden, unplanned demands for cash. Employees value the financial wellbeing that these flexible pay models provide, as they offer a means to avoid unnecessary debt.

6. Absence Verification

As we discussed earlier, it’s important to formalize the conditions under which absences are deemed legitimate.

One way of doing this is by requiring a note from a medical professional if the reason for the absence is an illness. If you find that an employee consistently takes sick days without being able to produce verification of their illness, take action.

Sit down with them and discuss the matter. There could be underlying causes for their absences of which you are unaware, for example, a financial or family issue or a chronic health problem. You may find that it’s entirely possible to arrive at a workable and mutually acceptable solution with your employee.

7.  Attendance Tracking Tools

When people come in late, leave early, or take extended breaks, it can cost your business money. In larger organizations, it’s often difficult for employers to monitor when their people are arriving and leaving.

This problem can be solved by requiring employees to clock in and out manually. In corporate environments or where people work remotely, time tracking software can be useful in ensuring employee attendance and productivity.

For more insights and tips on how to reduce absenteeism in the workplace, check out our blog.

As we’ve discussed, absenteeism is a complex and multifaceted challenge. While it’s unlikely you’ll ever completely eliminate it, following these steps and guidelines will certainly help you reduce it.

How Payactiv Can Help

Payactiv’s all-in-one livelihood platform takes a holistic approach to improving financial wellness and has helped employees save more than $400 million by avoiding unnecessary payday loans, overdrafts, and late fees.

Through our EWA services, we enable employees to access their pay on-demand. Our service is low-cost to employees and zero-cost to employers. Our unique operating model means that our service doesn’t involve lending money to employees – we simply provide access to their cash as they earn it.

There are no credit checks and no adverse impact on credit histories. We offer a SaaS-based service so that employees can access it anywhere, with a smartphone. Our service integrates fully with the systems provided by the significant payroll and HR management platforms to align fully with your payment process from the get-go.

Additionally, our relationships with industry partners, like Uber, mean employees can pay for Uber rides with their accessible earned wage balance using their smartphones.

Our company communication capabilities allow employees to engage with company announcements and shift management systems while they’re on the go, giving them additional working flexibility where and when they need it.

The results that our customers have realized speak for themselves:

• Turnover Reduction: Payactiv users have shown to be more than 30% less likely than non-users to leave a company on average.
• Improved Productivity: EWA removes the stress of handling payments between paychecks, allowing users to focus on their work.
• Lower Healthcare Costs: Reducing money-related stress improves overall health and results in fewer doctor visits for health issues connected to stress.
• Happier Employees: With an eNPS score of 84.7, most Payactiv users are either likely (11.3%) or very likely (73.4%) to recommend their employer to their friends.

Learn more about how Payactiv can help you, or book your demo now.