Friday, 15 October 2010


Levels, causes, costs and patterns
According to the last CIPD “Absence Management” Survey, in 2009, the average employee absence rate has been of 3.3% - 7.4 days per employee a year -, compared to the 3.5% - 8.0 days a year - recorded during the previous 12 months.
This is the lowest absence rate since 2000 and is calculated considering calendar years.
Table 1 shows the trend emerged during the last 10 years.

Sector differences
The investigation revealed that, considering the different sectors, the highest absence score remains pretty high in the public sector, with 9.7 days per employee a year, although recoding a slight decreasing from the previous year’s rate of 9.8 per employee.
Non-profit organisations, the only sector recording an absence ratio increase, reached the second highest ratio with 9.4 days absence a year per employee.
Things have definitely gone better in the “manufacturing and production sector” and in the “private sector services” organisations, where the ratio dropped respectively to in6.5 and 7.2, compared to 7.2 and 6.4 days per employee per year recorded at the end of the previous 12 months.
More in particular, the manufacturing and production sector recorded the highest absence level with 9.1 days per employee per year, with a remarkable increase compared to the 5.1 days figure of the previous year.
On the other hand of it, still remaining in the manufacturing and production sector, the lowest absence level was attained by textiles employees, who recorded an average of 3.7 days of absence per year.
In the private sector services call centres revealed to be the businesses mostly affected by staff absence, with 12.4 days per employee per year, even though it recorded a slight decrease, - 0.4, compared with the previous year.
Better results were achieved by the IT services’ staff who, although recording a 0.4 increase, recorded a 4.8 figure.
In the public sector, somewhat ironically perhaps, the highest absence level was recorded in the health services, where employees had an average absence rate of 11 days per year. Nevertheless, this result represents an improvement compared to the 11.7 days per employee registered in 2008.
Confirming the trend emerged during the previous 12 months, education was, instead, the sector reporting the lowest figure, 7.5 days, registering a further reduction compared to the 7.8 days per employee per year recorded during the previous 12 months.
Amongst non-profit organisations care services employers were the worst performers in terms of absence ratio, attaining the average rate of 10.2 days per employee per year, which represents an increase of 1.3 from the previous year. The best performer emerged to be the “other voluntary” sector organisations, where the absence rate decreased from 6.0 days, from the previous year, to 5.1.
The investigation revealed, not really surprisingly, that between manual and non-manual workers, the former attained the higher absence ratio, with 8.6 days per employee per year, whilst the latter recorded 5.9 days per employee.
For further details see Tables 2 to 5.


Increases Vs decreases
Amongst the businesses participating to the survey, 21% reported an absence rate increase, whilst 37% reported a decrease, 27% reported no change at all and 15% did not stated.

The influence of workforce size
As showed in Table 6, the survey findings revealed a direct link between an organisation size and its absence rate. In particular, organisations having a lower number of staff reported lower absence rates and vice versa.
This is possibly due to the circumstance that in smaller organisation working teams are composed by a reduced number of people, so that the absences of each of them have a more sensible impact on the team’s activities and performance and are, additionally, harder to compensate, which very likely account for a staff higher sense of responsibility .
Difference between public and private sector
The average absence rate within the public sector continues to be higher than the one recorded in the private sector and this gap is far from being closed; on the contrary, it has rose from 2.6 days per employee per year to 3.3 days.
This trend is putting under increasing pressure policy-makers in the public sector who are currently struggling to cut budgets and improve service levels and productivity.
Although there are no clear explanations about the causes behind the gap between public and private sector absence rates, some considerations could help to explain this occurrence.

It is sometimes argued that this dissimilarity depends on the different workforce size of public and private companies, where public organisations are usually bigger than their private sector counterparts and, as sees above, bigger organisations tend to record higher level of absence rate. But this assumption is actually contrasted by the same findings of the survey which, almost invariably, revealed that public sector staff have higher rates of absence regardless of the organisation’s size, as showed by Tables 7 and 8.

Research carried out by the Health and Safety Executive (HSE) revealed that this dissimilarity could be caused by the different demographics composition of the two kind of workforce, where in the public sector there is a higher component of female and elder workers, who usually register higher than average levels of absence.
Another explanation of the public sector organisations higher absence rate could be found in the kind of job usually carried out within public sector offices, which, more in particular, exposes staff to challenging public-facing roles, such as those involved in teaching, nursing and social care.
In order to explain this gap also the different way absence policies are managed within public and private sector companies could turn to be pretty useful. In fact, despite public sector employers usually put in place best practice approaches to manage absence, such as considering absence rate as a key performance indicator, putting in place system able to tackle unacceptable levels of absence and training line managers in absence-handling, they are, then, less likely to use disciplinary procedures to contrast unacceptable absence levels identified, discipline or dismiss employees for absence-related reasons or restrict pay sick.
Higher absence rate notwithstanding, public sector staff continue to enjoy occupational sick pay for longer periods than that allowed to private sector workforce.
Although it is not definitely an easy task, public sector employers should struggle to find a right balance between supporting staff and taking decisive actions against those who just take advantage of their occupational sick pay schemes.

Length of absence
Nearly 66% of the total days of absence recorded during a single year are represented by spells of up to 7 days, 17% of periods of absence of between 8 days and 4 weeks, whilst nearly 15% is represented by episodes of absence of more than 4 weeks.
Private sectors respondents reported a higher proportion of short term absence periods compared to the public sector respondents.

Absence cost
The average cost of absence per employee per year rose to £692, from £666 of the previous year.
The annual cost per employee per year remains higher in the public sector, at the average of £784, although this represents an improvement compared to the average sum of £906 attained at the end of the previous year.
Manufacturing and production sector registered the second highest absence cost at £754 although, also in this case, a slight improvement compared to the previous year has been achieved (£759).
Although registering a slight increase from the previous year, passing from £663 to £666, the lowest absence cost per employee per year has been recorded by private services organisations.
Table 9 shows the average cost per year per employee recorded in the different sectors.
Although, by and large, employers seem to be very interested on reducing absenteeism and to implement management policies capable to control the phenomenon, the survey revealed that only 41% of organisations actually monitor absence costs.
Considering the cost associated with absence and the potentially relevant savings which organisations could make paying more attention to the phenomenon, more investments to devise and improve people and absence management policies would be definitely worth.
Amongst the different sectors, public services organisations are the most likely to monitor absence cost, nonetheless, less than half do it. The least likely employers to monitor absence costs are the manufacturing and production ones, with just 37% doing so.
Amongst the companies monitoring absence costs, the cost more commonly included are: occupational sick pay, Statutory Sick Pay and cost of replacement labour.
See Table 10 for more details.
Targets and benchmarking
Amongst the surveyed organisations only less than 50% has set a target for reducing absence, with public sector employers the most likely to set a target (63%) and private services sector business less likely to set target (35%).
It also emerged from the survey that few organisations benchmark their absence management performance against other organisations, with public services employers the most likely to do so (64%) and productions organisations, with a measly 28% ratio, the least likely to benchmark.
Within the benchmarking employers 83% claimed to do so against organisation in the same sector, whilst 26% reported to benchmark their absence data against organisations located in the same region.
It also emerged that public services organisations are most likely to benchmark by sector, whilst manufacturing and production employers are most likely to benchmark by region.

Most recurring causes of absence
The survey findings revealed that the most recurring causes of short-term absence are minor episodes of illness such as flu, cold and stomach upsets, with no significant difference between manual and non-manual employees.
The next most relevant causes of short-term absence amongst manual workers are represented by musculoskeletal conditions, followed by back pain and stress.
Also home and family responsibilities were listed by employers as recurring causes of manual staff absence, as well as recurring medical conditions such as asthma and angina.
Stress is, instead, the second cause for absence amongst non-manual workers, followed by musculoskeletal conditions, home and family responsibilities and back pain.
The investigation also revealed that amongst non-manual staff other relevant causes of short-term absence are represented by recurring medical conditions and non-work-related injuries.

Sector differences
One of the most peculiar findings of the survey is represented by the different main causes of short-term absence relating to each of the sectors investigated, apparently, so to speak, each sector has it “preference”.
Both manual and non-manual public organisation staff seem to be most prone to short-term absence because of musculoskeletal injuries and stress-related reasons.
In not- profit organisations, instead, pregnancy-related causes and medical conditions are the most recurring events preventing employees to go work, also in this case invariably for manual and non-manual workers.
In private sectors organisations, once again both for manual and non-manual staff, non-genuine absence and home responsibility are the most recurring causes for employees’ absence.
Manual workers of manufacturing and production organisations are most likely to be absent at work because of work and non-work-related injuries, as well as drug- or drink-related reasons.

Long-term absences
Reasons for long-term absence amongst manual staff, with the exception of rare acute medical conditions, are not that different from the short-term ones. Back pain, musculoskeletal and stress, in fact, are the most recurring causes of staff absence.
Amongst the most recurring causes of absence of manual workers mental ill health and non-work-related injuries and accidents are also cited as significant causes.
The survey also revealed that the main cause of long-term absence amongst non-manual workers is represented by stress, followed by acute medical conditions, mental ill health, such as clinical depression and anxiety, and musculoskeletal conditions.
Other recurring causes for long-term absence amongst non-manual employees are back pain and recurring medical conditions.

Long term absence in the different sectors
The most likely causes of long-term sickness amongst manual workers in the public sector are acute medical conditions, back pain, musculoskeletal conditions and stress.
In manufacturing and production sector manual staff are most likely to no show at work because of work-related injuries and home and family responsibilities.
Non-work-related injuries and pregnancy-related absence are most commonly reported as significant causes of long-term absence for manual employees by private services sector organisations.
Non-profit employers are most likely to cite recurring medical conditions as a main cause of long-term absence for manual workers.
According to the survey’s findings mental ill health, musculoskeletal conditions and back pain are most likely to be cited by public sector organisations as major causes of long-term absence amongst non-manual staff.
Acute medical conditions and stress are, reportedly, the most recurring causes of long-term absence amongst non-manual no-profit employers.
Private services employers are most likely to report non-work-related accidents as a major cause of non-manual employee absence, whilst manufacturing and production organisations most commonly identify minor illnesses as a cause of long-term absence for non-manual employees.

The impact of recession
Almost 40% of respondents said that because of recession their organisation have paid more care to implement cost containment policies and, consequently, monitor and control absence. 16% claimed that recession did not have this effect and 41% reported that recession did not make any difference in the organisation approach to absenteeism. The survey revealed that, in general, the manufacturing and production and private sector services organisations are the more incline to claim that organisations have focused on reducing absence rate as consequence of the recession.
Recession has also had consequences on the attendance level, with 16% of companies believing that staff concern over job security has actually reduced their absence rate, compared to 11% who think the opposite. In all, over 50% do not believe that concern over job security has made any difference on the absence rate, whilst 15% do not know.
Amongst the employers believing that recession has had an impact on increasing attendance, or reducing absenteeism, the most likely to think so are manufacturing and production and private services sectors companies.
The research also revealed that more than 40% of the surveyed organisations consider their staff absence rate as part of the criterion used when selecting for redundancies, whilst 42% declared of not using absence to that end.
Amongst the different sectors manufacturing and production, with 60%, and private services sector, with 44%, are the most likely to use absence rate as a criterion for selecting redundant staff.
Another side effect of the downturn has been the excess of presenteeism of some staff to respond to the pressure caused by concern over job security. In all, 21% of employers, in fact, reported that they have seen increasing the number of people struggling to go work even though sick during the last year. A considerable 67%, instead, claimed of not having noticed any recession effect to that extent.
Not only absenteeism has a cost, but also this kind of presenteeism has. The Sainsbury Centre for Mental Health has estimated that the effect of this presenteeism, due by mental health, amounts to £605 for employee.

The absence figures emerged from this survey are the lowest recorded during the last decade and the achievement of this result could, if anything partially, be explained by the increasing focus and care paid by employers to the absenteeism phenomenon in order to reduce costs.
Another relevant reason for the absenteeism rate reduction could be explained by the change of staff attitude towards absenteeism because of their increased concern over job security, also in this case recession played a fundamental role. The fact that 56% of respondents declared of having made staff redundant over the last 12 months and that 40% of the surveyed organisations declared of considering absence rate to select redundant staff is, to some extent, self-explanatory.
The survey also reveals that the gap between average public and private sector absence levels has increased to 3.3 days from 2.6 days recorded in the previous 12 months. The recorded gap between public and private sector is, very likely, increasing pressure on policy-makers, who are already struggling to make savings on public spending and improve public sector productivity and service levels.
Although trying to find out which are the real causes for the absence gap between public and private sectors is everything but straightforward, it is possible to determine some relevant factors. One of them surely being the difference in demographic profiles between the sectors, with a larger number of female and older workers in the public sector. Additionally, the public sector is more typically characterised by the presence of more stressing and compelling public-facing roles, implying a higher degree of involvement and dealing with more emotionally charged situations, which possibly account for the higher level of absence within the public sector organisations.
This is not all, it is very likely, in fact, that also a substantial difference in culture and absence management practice between the two sectors plays a relevant role. The apparently higher degree of attention showed by public sector organisations on identifying high level of absence and training line managers in managing absence is considerably mitigated by the lack of implementation of consistent measures to effectively oppose the phenomenon. The survey, in fact, also revealed that public organisation employers are less likely than private sector ones to refer to disciplinary procedures in managing absence policies and to dismiss staff for having achieved unacceptable absence levels.
Public employers are also less likely than their private counterparts to restrict sick pay to help manage absence and to use employees’ absence records as part of the criterion when selecting for redundancy.
In order to achieve better results, the implementation of effective absence management practices is key. This implies and requires finding an appropriate balance between providing support to help employees who really have health-related problems stay in and return to work and taking consistent and firm action against employees who try and take advantage of organisations’ occupational sick pay schemes.
According to the survey findings it clearly seems that some public sector employers have still not yet achieved this balance.

Investigation background
The survey involved a panel of 642 respondents, whose average size was of 2,974 staff.
26.4% of the surveyed organisations were from the manufacturing and production sector, 43.2% were from the private services sector, 10.65% from non-profit organisations, whilst 19.7% were from public sector employers.