ABSENTEEISM

And

Personnel TurnoverTopic No:

Presented by

Mitul ZaveriGanesh M

Vipin Menon – Roll No: 31Ashesh

Aditya Swaminathan – Roll No: 01

Group No:MMM – 1st yr, 2nd Sem (2012-15)

Absenteeism is a failure of employees to report for work when they are scheduled to work

Absenteeism is defined as failure to report to work. And absenteeism has become a huge cost and disruption to employers

In terms of the discussion, the three terms “absence, absenteeism and sickness absence” will be used as synonymous in meaning, implying that workers who were scheduled for work and expected to attend, did not do so.

In other words , it signifies the absence of an employee from work when he is scheduled to be at work, unexplained, avoidable, and willful absence from work.

ABSENTEEISM

Maladjustment with factory condition

Social and Religious Ceremonies

Unsatisfactory housing condition

Industrial fatigue

Unhealthy working condition

Alcoholism

Inadequate leave facilities

No attendance policies

Primary Cause for Absenteeism

Maladjustment with factory condition

•As a worker continues to live in the city, urban life becomes distasteful to him because of the insanitary condition prevailing there.

•Employee finds himself caught with great factory falls, he is bewildered by heavy traffic, by jostling, by stranger speaking different languages.

•Employee confused by different religious and tastes, and he is misery of slums and of toiling for long hours.

•All these factors tend to persuade him to maintain his contacts with his village.

Social and Religious Ceremonies

Social and religious function divert workers from work to social activities. In a large number of cases, the proportion of absenteeism due to sickness, accident or maternity is not as it is due to other causes. Including social and religious causes.

For Example : The absenteeism in the textile industry due to sickness , accident or maternity amounted to an average percent 4.9% , due to social or religious and other causes, it was 5.1%.

In all the plants, absenteeism is high during local festival, irrespective of whether the workers are from rural areas or not.

Unsatisfactory housing condition

The worker who comes to town usually find that they are not wanted and they swell the number of unemployed and casual worker. They also experience housing difficulties.

Not less than 95% of the house occupied by industrial worker in India are unsatisfactory for healthful habitation. A room about 10’ x10’ accommodates a large family and occasionally two families., often ten to fifteen person sleep in one room.

The housing of migrants combines the worst characteristics of both rural and urban slums. Not only are the sites most insanitary but the material used for erecting huts are also very filthy.

Forsaken places like the slopes along the railway lines, banks of open drainage streams, waste land adjoining dirty localities in towns, open space earmarked for dumping the town refuse are chosen by them.Health condition are naturally bad, leading to high morbidity and consequent ill- health. Therefore, make frequent visits to their village homes to get relief from such insanitary and unhealthy surroundings.

Unhealthy working condition

Irritating and intolerable working condition exists in factories. Heat and moisture (which rapidly exhaust the worker), noise and vibration in the factory ( which affects his hearing), bad lighting condition (which cause eye strain), dust fumes and overcrowding all these affect the worker health, causing him to remain absent for a long time.

Alcoholism

The habit of alcoholism among workers is a significant cause of absenteeism. Which is high in the first week of each month. When workers receive their wages. They rush to liquor shops and drink to forget their immediate worriers. Once indulged in drink, the habit continues. Hangover the next day leads to absenteeism.

Inadequate Leave facilities

Negligence on the part of the employer to provide adequate leave facilities compels the workers to fall back on ESI leave.

Under ESI scheme, they are entitled to 56 days leave in a year on half pay. Instead of going without pay, the workers avail themselves of this ESI facility.

Supervisor with a work oriented rather than man oriented approach are also a factory which compels workers to absent themselves on an ESI certificate rather than avail of leave on bonafide grounds.

3. Personal Characteristics -Education -Sex/Family -Org. tenure responsibility -Age (also depends -Family size on sex) -Personality

2. Recruitment + Selection Job expectations about Attendance

7. Ability to Attend -Health (Depression, pain cardio fitness, smoking, drug use) -Illness & accidents -Family responsibilities -Transportation problems -Travel distance1. Job Situation

-Job autonomy -Job level -Work group size -Role Stress -Considerate leadership style -Coworker relationships -Scheduling (flexible, rotating)

4. Job Attitudes -Job satisfaction -Organ.commitment -Job involvement

6. Attendance Motivation

8.Employee Absenteeism (Attendance)

5. Pressures to Attend -Economic/market conditions -Human Resource Practices (incentives, control policies) -Work group norms/culture -Profit sharing/employee share ownership

Model of Employee Absenteeism

Calculation of Absenteeism Rate

Absenteeism rate can be defined as the habit or fact of frequently being away from work, usually without a good reason.

Absenteeism can calculated as follows:

Step 1

Find the average number of employees during the quarter. The average could simply be the sum of the beginning and ending employment numbers divided by two.

Step 2

Calculate the number of workdays in the quarter.

For example, if a quarter has 12 weeks, one statutory holiday and three irregular days, then the number of workdays in the quarter is 62 [(12 x 5) + 3 - 1 = 60 + 3 - 1 = 62].

Calculation of Absenteeism Rate

Step 3

Multiply the average number of employees by the number of workdays to get the total number of available workdays in the quarter. Continuing with the example, if the average number of employees in the quarter is 30, then the total number of available workdays is 1,860 (30 x 62).

Step 4

Determine the number of workdays lost to absenteeism. Use an eight-hour workday to calculate fractional days. Continuing with the example, if the employees claim an average of one sick day and have been absent an estimated two additional hours each during the quarter, then the number of workdays lost to absenteeism is 37.5 [(30 x 1) + (30 x 2/8) = 30 + 7.5 = 37.5].

Calculation of Absenteeism Rate

Step 5

To calculate the absenteeism rate for the quarter. It is the number of workdays lost to absenteeism divided by the total number of available workdays, expressed as a percentage. The absenteeism rate is about 2 percent [100 x (37.5/1,860)].

Administrative costs associated with rescheduling staff or hiring staff.   

Payroll costs for temporary staff.

Training costs associated with introducing temporary staff to the organization.

Reduced productivity.

Overtime may have to be scheduled to fill positions left by absent staff.

Added cost of training supervisors in the cost of absenteeism.

Many organization average the total number of absent days and schedule extra staff to cover - overstaffing to compensate for the lost productivity.

Insurance claims and legal fees associated with absent employees as a result of an accident at work.

Cost of time - how much does it cost the company every time an employee is away from their desk due to dentist / doctor appointments.

Costs associated with statutory sick pay and the increasing administrative work faced by payroll drive up costs.

Cost to the Employer

Features of Absenteeism

The Rate of absenteeism is the lowest on pay day, it

increases considerably on the days following the payment of

wages and bonus Absenteeism is generally high among the workers below 25 years of age and those above

40 years of age

The rate of absenteeism varies from department to

department within an organisation. Generally it is

high in the production department.

Absenteeism in traditional industries is seasonal in

character

The Percentage of absenteeism generally high in

Day shifts

The Percentage of absenteeism is much higher in coal and mining industries

then in other organized industries

Absenteeism in India in seasonal character

Measures to Minimize Absenteeism

It would be difficult be completely avoid absenteeism, however management can minimise absenteeism by adopting following measures.

Selecting the employees by testing them thoroughly regarding their aspirations, value systems, responsibility and sensitiveness.

Adopting a humanistic approach in dealing with the personal problems of employees.

Following a proactive approach in identifying and redressing employee grievances.

Providing hygienic working conditions

Providing high wages and allowance based on the organisational financial position.

Measures to Minimize Absenteeism

Absence due to industrial accidents programmes of industrial safety should be strengthened.

Educating the workers

Offering attendance bonus and inducements etc .

Personal Turnover

It is the rate at which an employer gains and loses employees.

Simple ways to describe it are "how long employees tend to stay" or "the rate of traffic through the revolving door".

This can be measured for a particular company or for an Industry as a whole.

If an employer is said to have a high turnover relative to its competitors, it means that employees of that company have a shorter average tenure than those of other companies in the same industry.

“Meaning”

Replacing work can be a costly part of a business

It incurs direct and indirect expenses

Loss of productivity during the time when old employee leaves and new employee has been fully trained

Replacing employees may also make it difficult to retain the clients or customers with whom those employees have worked

Importance to Business

Turnover is defined as the ratio of the number of employees who leave the business, either voluntarily or involuntarily, to the total number of people on staff and it is measured in terms of percentage.

Example : If there are 100 employees working in an organization out of which 10 people have left the job in a particular year than turnover rate of the organization is 10%

How to calculate staff turnover

Industry %

Manufacturing 34%

Engineering/Infrastructure

19%

Professional/Scientific/Technical/IT services

19%

Retailing 8%

Education Service 3%

Health Care 2%

Others 15%

Turnover rate in India In the year

2011

• Cost to Company (CTC) is a term used to describe an investment without return.

• Cost to Company can also be used to refer to the total cost that an organization is spending towards their employee including the Salary, Perks, Cost related to benefits, Cost related to hiring, Training, Retirals, Statutory Contributions etc

• in other words you pay for all your "benefits" yourself.• CTC is the amount that you cost your company. That is, it is the amount

that the company spends – directly or indirectly – because of employing you.

• For Example - Your company offered you a salary of Rs. 6 Lakhs per year. That means you should be getting Rs. 50,000 in hand every month. Even if you consider income tax, you should be getting about Rs. 40,000 in hand But you get only Rs. 32,000 in-hand every month

Cost To Company (CTC)

BasicDearness Allowance (DA) Incentives or bonusesConveyance allowanceHouse Rent Allowance

(HRA)Medical allowance Leave Travel Allowance or

Concession (LTA / LTC)Vehicle AllowanceTelephone / Mobile

Phone AllowanceSpecial Allowance

Components of CTC

2 Factor Theory – Push & Pull

Push factors are aspects that drive the employee towards the exit door. They make the person want to leave, make them start thinking about other options, about talking to recruiters, looking at the job ads in the paper, on the internet etc. In some instances employees will even go so far as to leave without a new job lined-up.

Pull factors are those reasons that attract the person to a new place of work. So in this category we would have the likes of a better paying job, a career advancement opportunity that they wouldn't have got in the short term had they stayed with their present employer, and so on.

Causes of Personnel Turnover

Labor turnover is the outcome of resignation and dismissals

Resignation dissatisfaction with working condition, insufficient wages, bad health, sickness, retirement, family circumstances

The badli system also contributes to a high turnover because, with a view to providing work for badli workers, many worker are forced to leave.

Causes of Labor Turnover

Evaluate Managers

Create a Recognition Culture

Maintain Healthy Work Environment

Continual Self Improvement & Career Advancement

Most reasonable Salary

Match People & Best Jobs suited for them

Benefits

Steps to Reduce Personnel & Labor Turnover