Which costs your business more – staff who miss work or ones who show up physically but take a mental PTO day?
For most businesses, it’s the latter. So why do even savvy upper managers and finance directors (we’re not just talking about the bean-counters) worry about absenteeism while downplaying so-called presenteeism as a drain on company productivity, not to mention the compensation and benefits budget?
In some cases, upper managers seem to think that admitting that presenteeism even exists at the firm is akin to saying, “We’re a poorly run company.” In reality, presenteeism exists in every workplace.
Virtually every employee, manager, supervisor and executive who’s ever tried to “tough it out” at work when he or she’s been sick has been a presentee on those days.
So has anybody who’s ever been distracted at work by non-work issues – whether it’s spending the day trying to resolve a personal financial matter, checking on a sick child at home or constantly checking for scoring updates from a sporting event.
In brief, unless we’re to believe that every employee is productive every single day, no company in the world is immune from presenteeism.
A lot of organizations that don’t bury their heads in the sand about presenteeism still don’t track it. Why? Usually, there’s a belief that chronic presentees eventually get rooted out of the business.
And short of watching over every other employee’s shoulder throughout the workday, it’s too challenging (and even counterproductive) to attempt to estimate the cost to the corporation.
Here are some strategies that firms have used to not only measure the cost but also reduce the problem.
Creating a cost estimate
If your corporation is like most, upper-level management worries endlessly about health benefit costs without realizing undetected presenteeism is just as costly, but easier to control.
Consider these facts from a recent CSG study – Nearly 10% of the typical annually pay and benefits
budget is spent on non-productive (but treatable) employees.
Add in workforce who call out at the last second and the percentage rises to 17 percent, as reported by SHRM.
But how do you estimate the actual dollars-and-cents cost to your firm?
Let’s assume you have 50 personnel, who make an typical $40,000 a year. Over the while the year, the typical staff member is non-productive 2.5 % of the time, because of assorted personal issues or minor illnesses that serve as distractions.
In this instance, presenteeism costs your company $50,000 a year. When you have a 5% presenteeism rate, the figure shoots up to $100,000.
While it’s impossible to entirely stamp out presenteeism, even small reductions in presenteeism add up to large bucks in controlling compensation and benefit costs.
The next step, of course, is doing something about the issue. Broadly speaking, the process typically works in three phases -
o review current policies and procedures for things that accidentally increase presenteeism
o get supervisors and workers involved on the front end, and
o stress the importance of work-life programs to upper-level management and supervisors.
Let’s look at each area to see how they work in real-life practice.
Three common ways many firms attempt to cut absenteeism often increase presenteeism -
1. Over-stressing attendance in employee’s annual reviews
2. Having supervisors check up on staff who take sick days to verify they’re really ill, and/or
3. Disciplining workforce for last-moment sick callouts.
From a practical and cost standpoint, the best solution could be to switch from separate vacation and sick-day benefits to a single compensated time off (PTO) bank.
When folks have no-questions-asked control over their off days, they’re sometimes more likely to use a PTO day if they’re sick. Of course, you know that PTO carries some risks of its own.
Fewer than one corporation in 10 gets both managers and employees involved in the process of spotting and eliminating presenteeism.
That’s too bad, says consultant Mary Beth Chalk, because it can been done pretty easily.
Ask a sampling of staff to rate how energetic and productive they normally feel at work, on a percentage scale. Have supervisors estimate their staff as well. Then split the difference.
The result is a pretty good barometer of your organization’s current and future presenteeism risk.
Anything you are able to do to promote work-life programs at your firm can have a positive effect on the bottom line. Proven ideas include -
o rewarding supervisors who support flexible work arrangements
o sending sick workforce home
o cover onsite flu shots, and
o Actively promote your existing Worker Assistance Program.