Managing absence in organization

1. THE NATIONAL CONTEXT

The CIPD (2006) found a level of 3.5 per cent sickness absence (defined as the percent­age of working time missed, and often referred to as the headline rate) from a survey they carried out in early 2006 with responses from 1,083 public sector and private sector organisations. This represents eight days’ absence per employee per year. CIPD com­mented that this is a reduction on the figure of 3.7 per cent reported by a similar survey in the previous year. Other surveys produce fairly similar figures; for example the CBI survey (CBI/AXA 2006) reports a rate of 3.1 per cent (equating to 6.6 days lost per person per year). Whilst this is the lowest figure found since the CIPD absence surveys began in 2000, it is, for two reasons, difficult to argue yet that there is a clear downward trend in absence rates. First, the rate in the CIPD surveys has fluctuated up and down, as in the CBI survey. Second, while the methodology of the CIPD survey remains con­stant the actual organisations responding each year are not necessarily the same, within either the CIPD or CBI surveys. In addition, the Engineering Employers Federation (EEF) (2005) report that absence has become a bigger problem since their survey in 2003, with the rate increasing from 2 per cent to 3.6 per cent, yet it reduced again the following year (EEF 2006). Bevan of the Work Foundation (Silcox 2006) concludes that absence has remained broadly at the same level for the past 30 years with small fluctuations due to unemployment and the wider economic cycle.

In terms of the patterns of absence most surveys report that absence is higher in larger than in smaller organisations, which is likely to be why the CBI figures are generally lower than the ones from the CIPD, as the CBI sample includes a higher proportion of smaller organisations. Public sector absence is usually found to be higher than that in the private sector: for example in 2006 the CIPD found the public sector absence rate to be 4.3 per cent. Reviewing the Labour Force Survey, the General Household Survey and employer surveys, Barham and Leonard (2002) found that absence does tend to be con­centrated in some groups of people rather than others: in addition to higher rates in the public sector they found higher rates for women, full-time workers and those aged under 30. They also found differences by occupational group, with managers, professionals and administrative professionals having lower levels than other groups. The CBI found that sickness absence was higher among manual workers, and this to some extent must reflect the nature of job demands. The CIPD (2006) found that absence levels were high­est in the food, drink and tobacco sector, local and central government and the health sectors; and lowest in media and publishing, the voluntary sector, and the hotel, restaur­ant and leisure sector. These sectors do change to some extent each year.

The CBI reports that absence costs the UK economy around £13 billion per year and it constantly asserts that around 13 per cent of all absence is not genuine, whilst unions point to the efforts that workers often make to attend work even when ill (see, for example, TUC 2005). Big sporting events, such as the World Cup, often attract atten­tion in terms of their impact on absence levels, but organisations can use these events to their advantage given some thought. Smethurst (2006) reports on how Prudential and Egg responded to the World Cup by offering more flexible working over the period, with incentive schemes and themed competitions to incorporate interest in the event.

At a national level the government has an interest in reducing absence and loss of employment due to sickness. Roberts (2003) reports that while there are 1.46 million people claiming unemployment pay, there are 2.7 million people out of work claiming long-term sickness and disability benefits. Roberts goes on to explain how this situation has stimulated a focus on how society manages long-term sickness and rehabilitation. The government has an interest in reducing NHS costs and Invalidity Benefit costs, and the Department for Work and Pensions has arranged a two-year series of job rehab­ilitation pilot studies. The pilots will test three different approaches, healthcare inter­ventions, workplace interventions and combined interventions, and the aim is to learn which approaches are most successful. The Welfare Reform Bill proposes a variety of measures designed to encourage and enable welfare claimants back to work (for brief details see, for example, Brockett 2006; Griffiths 2006).

2. THE ORGANISATIONAL CONTEXT

Barham and Leonard (2002) question the accuracy of data in absence surveys. They argue that given the low response rates to such surveys, there is no evidence to suggest that the survey findings are representative of the whole population. In addition the CIPD found that much management absence is not recorded. It is likely that respondents are those with better absence information. On this basis they argue that absence costs to the organisation are underestimated.

The CIPD found that over 90 per cent of organisations in their survey considered absence to be a significant cost to the organisation, but less that half monitored this cost. The average cost was reported to be £598 per year per employee. Barham and Leonard (2002) suggest that estimating the costs of absence is complicated, and that the estimate needs to include not only the direct costs (i.e., paying salary and benefits for a worker who is not there), but also indirect costs such as organising replacement staff, overall reductions in productivity and administrative costs. Bevan (2002), reporting research from the Employment Studies Institute, suggests that there are virtually no robust data on direct and indirect costs of absence and that most employers under­estimate the true costs of sickness absence, particularly in respect of long-term sickness. Costing currently does not distinguish between short-term and long-term sickness. Using case study research Bevan reports that long-term sickness costs account for between 30 per cent and 70 per cent of absence costs. He goes on to argue, on the basis of this research, that even the most sophisticated companies are not well equipped to calculate such costs.

Statutory Sick Pay (SSP) changes in 1994 have given absence costs a higher profile as the burden has been passed to the employer, although there were compensatory mech­anisms in place and direct costs to the employer are increased and are more prominent.

Traditionally employers have concentrated on short-term absence, and while long­term absence accounts for only around 20 per cent of absence incidents it can represent more than 40 per cent of total working time lost, according to the CBI, although figures do vary. CIPD (2006) found that long-term absence was most significant in the public sector where it accounts for 25 per cent of absence, compared with 17 per cent in manu­facturing, 16 per cent in not-for-profit organisations and 12 per cent in private services. Reducing such absence is increasingly seen as having the potential to create significant costs savings. Cost is not the only factor in influencing organisations to attend to long-term absence, and we have already mentioned government interest in this. In addi­tion, the Disability Discrimination Act 1995 requires employers to provide reasonable adjustments to enable disabled workers to continue in employment, and the term ‘disabled’ extends to those suffering from long-term ill health. It has been argued that employers have a more explicit duty of care to their employees due to UK and EU legisla­tion, and there is a growing concern for the well-being of employees, partly due to fear of litigation.

In summary the evidence suggests that absence levels in the UK are decreasing to a small extent, but that there is insufficient evidence as yet to conclude how our absence rates compare with the rest of Europe. Long-term sickness generates proportionately greater costs and problems than short-term sickness and it is appropriate that the focus on this has increased significantly in recent years.

3. PROCESS AND CAUSES OF ABSENCE

The CIPD found the most frequently stated causes of absence are minor illness for short­term absence and back pain and minor illness (for manual workers) and stress and minor illness (for non-manual workers). For long-term illness the most frequent causes for manual workers are back pain and musculo-skeletal injuries; and for non-manual workers stress remains the greatest, and an increasing cause. The increase in stress as a cause may well be partly due to the fact that this is now a more legitimate reason for non-attendance than previously. Case 15.1 on this book’s companion website at www.pearsoned.co.uk/torrington focuses on stress as a reason for absence. It is import­ant to bear in mind that recorded causes of absence in organisations will be those causes which employees perceive the organisation to view as legitimate.

The causes of absence are complex and interrelated and a process approach is gener­ally agreed to be the most useful way of understanding absence behaviour, although there are criticisms that such models are not supported by the evidence. One of the most widely quoted models is from Rhodes and Steers (1990) and in our view this is the most useful of the process models. For an alternative model see Nicholson (1977).

The Rhodes and Steers model (see Figure 15.1) not only includes content information on the causes of absence but also incorporates a range of interdependent processes. In essence the model focuses on attendance motivation and the ability to attend in terms of resulting attendance behaviour.

Rhodes and Steers suggest that attendance motivation is directly affected by two factors: satisfaction with the job and pressure to attend. Pressure to attend may result from such factors as market conditions. Examples include the likelihood that there will be redundancies at their workplace and how easy it would be to get another job; incentives to attend, such as attendance bonuses; work-group norms on what is acceptable in the work group and the effects of absence on other group members; personal work ethic producing internal pressure to attend based on beliefs about what is right; and com­mitment to the organisation through an identification with the beliefs and values of the organisation and an intention to remain with the organisation. On this basis threat of redundancies, attendance bonuses, team structures where team members have to cover the workload of an absent member, a personal ethic about the need to attend work wherever possible, and feelings of loyalty to the organisation should all promote the motivation to attend.

Rhodes and Steers suggest that satisfaction with the job is determined by the job situation and moderated by employee values and job expectations. Factors in the job situation are identified as job scope and level of responsibility and decision making; role stress such as work overload, underload, difficult working conditions or hours; work-group size; leadership style of their immediate manager, particularly the openness of the relationship and how easy it is to discuss and solve problems jointly; strength of relationships with co-workers; and the opportunity for promotion. On this basis higher levels of responsibility and the opportunity to make decisions in relation to job demands, balanced workload and good working conditions, small work group size, an open relationship with immediate manager, good relationships with colleagues and the opportunity for promotion should all improve attendance motivation.

However job satisfaction is moderated by the values and expectations of the employee. Such values and expectations are shaped by both personality and personal characteristics and life experiences, but can also change during the course of one’s life. The extent to which the job matches up with expectations and values will have a bearing on job satisfaction; a close match is more likely to lead to satisfaction than a mismatch.

Personality and personal characteristics influence expectations and values and job satisfaction. We have previously referred to the influence of age and sex on absence rates. Length of service has also been identified as having an influence. However, none of these relationships is clear-cut, and different pieces of research often produce differ­ent findings. There is most evidence for suggesting that younger workers and female workers have the highest rates of absence, and it is argued that younger workers value free time to a greater extent than older workers.

This brings us to the last influence on attendance, which is the ability to attend. This influence is interposed between attendance motivation and actual attendance. For example an employee could be highly motivated to attend, but may have insurmount­able transportation difficulties, family or domestic responsibilities, or may be genuinely ill. In these cases motivation to attend does not result in attendance.

Source: Torrington Derek, Hall Laura, Taylor Stephen (2008), Human Resource Management, Ft Pr; 7th edition.