In Part 3 of our series on Presenteeism and Absenteeism, we will look at the role of mental health issues in absenteeism, how employers can calculate the cost of absenteeism, and the need to build resiliency in the workforce to combat absenteeism.
In Part 2, we looked at how most employers do not track absenteeism, and this makes it more difficult for them to address it. Here are some ideas for employers to consider as they think about Absenteeism.
Tracking to Calculate the Cost of Absenteeism
Although 90% of Canadian employers say that absenteeism is costly to their business, only 40% or less take the initiative to track what that cost actually is. Some studies have revealed that absenteeism could cost a private company as much as 5% of their payroll, and that number is even higher in the public sector. The reality is that tracking absenteeism is not as difficult as some employers may believe, and managing it can save them a lot of money.
The pieces of information required to calculate the Direct Costs of absenteeism are: salary/payroll costs, overtime costs to cover absent employees, any insurance costs related to absences, the costs of employees on short term disability (STD), Workers Compensation (WC) costs through a third party premiums paid to provincial board, and finally, the long-term disability (LTD) insurance costs.
There are also Indirect Costs of absenteeism which need to be factored into the total cost. These include the costs associated with recruiting, training and integrating new or temporary employees to replace absent ones, the management costs for staff to manage the effects of absence and find replacements, the cost of lost productivity, potential client services costs in the form of penalties from delays, and finally, there is the psychological costs to employee morale when some have to step up to take on extra work to cover for an absent colleague.
Determining the cost of absenteeism is done to help the organization understand the extent of the problem financially, but also to acquire insights into the needs of its employees in terms of support and improved company culture to reduce absences.
Mental Health Issues and Absenteeism
As important as it is to calculate the costs of absenteeism, it is vitally important to glean from that data a sense of the real causes of absenteeism. In one study, 52% of employees indicated that they were absent for reasons not related to physical health. They were more likely to attribute their absences to high work-related stress, or lower levels of support for mental illness from the organization.
Since COVID shed a spotlight on mental illness, employers are more keenly aware of the impact of mental illness on their workforces. Studies have shown that workplace stress is a primary cause of mental health issues for Canadian employees. Depression and anxiety are listed as the top two mental health problems experienced by workers as a result of their place of work by 70% if respondents, and 78% said that mental health was the main reason for their absences from work.
Resilience is the capacity to withstand and manage stress. It includes being able to adapt to changing circumstances and rebuild well-being through self-care strategies such as maintaining supportive personal and professional networks.
Now more than ever, Canadian employers need to recognize that mental health issues span a spectrum of symptoms and severity, and that support for employees needs to address that spectrum as well. The goal is to reduce workplace stresses which are a major contributor to employee mental health concerns, and at the same time, increase the resiliency of employees with adequate supports to manage stress in the workplace.
Ideally, employers and employees should work together to find ways to help employees choose positive coping strategies for stress and anxiety such as professional therapy, meditation, exercise, and avoid the negative ones such as alcohol, smoking, or recreational drugs.
Assisting employees to develop stress management skills would go a long way to reducing their stress, anxiety, and absences. Those skills include self-control to resist substance abuse, smoking, sugar and trans fat foods, to exercise regularly, improved sleep, relaxation techniques, time management, resting and relaxation on weekends, and seeking proper support.
At Health Risk Services, we help managers of benefits plans make strategic decisions to craft cost-effective personalized plans that can assist you and your organization to address the Absenteeism challenge and build Resiliency. Whether the solution of preference for your company is adding additional support programs, renovating your existing coverage, or crafting intentional messaging, Health Risk is here to help!
To schedule your Complimentary Consultation with Health Risk Services, please call 403-236-9430 OR email: [email protected]