The Cost of Absenteeism to Your Business
In any business, a certain amount of absenteeism is unavoidable – people do get sick and there are times when employees will be required to take time off; however, when absenteeism becomes excessive, the cost to your business in terms of lost revenue and productivity can be extreme. Across Canada, the average number of sick days for the last four consecutive years has been 7.4. This has resulted in an estimated $16.6 billion as a cost to our economy.
The good news is that there are strategies that employers can utilize to keep absenteeism to a minimum. The first step is always for an employer to understand the financial impact that absence is currently having on their business and identify any problem areas and trends.
It therefore important that an employer understands the key rates of absenteeism and the resulting costs that can have a significant detrimental effect. By doing this the employer will establish a baseline from which to track their progress.
Absenteeism rates and costs
*hourly rate X hours worked in a day
Bringing down the rate of absenteeism
While you can never eliminate absenteeism completely, there are steps that businesses can take to reduce it. In one case study for example, a company found that it could reduce the mental stress (and therefore absenteeism) on employees by offering more flexible work schedules and work from home options.
Another important piece of the puzzle is disability management. Often, when an employee is absent from work for a prolonged period, they are off work longer than necessary simply because their company does not have an adequate disability management program in place. Ultimately, this hurts the bottom line of the business.
Employers can be proactive in their disability management programs by:
- Having a plan in place that offers employees quicker access to medical care and treatment such as that provided by TekMed’s QuikCare; and
- Adopting effective return-to-work strategies which accommodate employee needs and help them perform their tasks safely in a modified capacity.
When absenteeism rates get too high, businesses can see much of their profit margin go down the drain. When you have calculated the cost of absenteeism in your business, you can then develop strategies to reduce that number. For help getting started, contact the team at TeksMed today.