Presenteeism: Myth or reality?

Growing problem: ‘I’m here (but I’m not working)’

 

Which costs your organization more: employees who miss work or ones who show up physically but take a mental PTO day?

For most employers, it’s the latter. So why do even savvy senior managers and finance directors (we’re not just talking about the bean-counters) worry about absenteeism while downplaying so-called presenteeism as a drain on company productivity, not to mention the compensation and benefits budget?

In some cases, C-levels and supervisors seem to think that admitting that presenteeism even exists at the firm is akin to saying, “We’re a poorly run organization.” In reality, presenteeism exists in every workplace.

Virtually every employee, manager, supervisor and executive who has ever tried to “tough it out” at work when he or she has been sick has been a presentee on those days. So has anyone who’s ever been distracted at work by non-work issues – whether it’s spending the day trying to resolve a personal financial matter, checking on a sick child at home or constantly checking for scoring updates from a sporting event.

In short, unless we’re to believe that every employee is productive every single day, no employer in the world is immune from presenteeism.

Some organizations that don’t bury their heads in the sand about presenteeism still don’t track it. Why? Usually, there’s a belief that chronic presentees eventually get rooted out of the company. And short of watching over every other employee’s shoulder throughout the workday, it’s too difficult (and even counterproductive) to try to estimate the cost to the organization.

Here are some strategies that firms have used to not only measure the cost but also reduce the problem.

Creating a cost estimate

If your organization is like most, upper management worries endlessly about health benefit costs without realizing undetected presenteeism is just as costly, but easier to control.

Consider these facts from a recent CSG study: Nearly 10% of the average yearly pay and benefits
budget is spent on non-productive (but treatable) employees.

Add in employees who call out at the last second and the percentage rises to 17%, according to SHRM.

But how do you estimate the actual dollars-and-cents cost to your firm?

Let’s assume you have 50 employees, who make an average $40,000 a year. Over the course of the year, the average employee is non-productive 2.5 % of the time, due to assorted personal issues or minor illnesses that serve as distractions.

In this instance, presenteeism costs your organization $50,000 a year. If you have a 5% presenteeism rate, the figure shoots up to $100,000.

While it’s impossible to entirely stamp out presenteeism, even small reductions in presenteeism add up to big bucks in controlling compensation and benefit costs.

The next step, of course, is doing something about the issue. Broadly speaking, the process usually works in three phases:

  • review current policies and procedures for things that accidentally increase presenteeism
  • get supervisors and employees involved on the front end, and
  • stress the importance of work-life programs to senior management and supervisors.

Let’s look at each area to see how they work in real-life practice.

Unintentional effects

Three common ways many firms try to cut absenteeism often increase presenteeism:

  1. Over-stressing attendance in employee’s annual reviews
  2. Having supervisors check up on employees who take sick days to verify they are really ill, and/or
  3. Disciplining employees for last-moment sick callouts.

From a practical and cost standpoint, the best solution may be to switch from separate vacation and sick-day benefits to a single paid time off (PTO) bank. When folks have no-questions-asked control over their off days, they’re sometimes more likely to use a PTO day if they’re sick.  Of course, you know that PTO carries some risks of its own.

Early detection

Fewer than one organization in 10 gets both managers and employees involved in the process of spotting and eliminating presenteeism.

That’s too bad, says consultant Mary Beth Chalk, because it can been done pretty easily.

Ask a sampling of employees to rate how energetic and productive they typically feel at work, on a percentage scale. Have supervisors estimate their staff as well. Then split the difference.

The result is a pretty good barometer of your organization’s current and future presenteeism risk.

Work-life balance

Anything you can do to promote work-life programs at your firm can have a positive effect on the bottom line. Proven ideas include:

  • rewarding supervisors who support flexible work arrangements
  • sending sick employees home
  • cover on-site flu shots, and
  • actively promote your existing Employee Assistance Program.

Is presenteeism an issue at your company? How have you addressed it? Let us know

Richard Reid is the founder of Pinnacle Proactive, Specialising in theEmployee Assistance ProgramStress ManagementStaff Retention & Absenteeism. Take a Proactive Approach to Growing Your Organisation & its People. For more info visit http://www.pinnacleproactive.com

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