The U.S. Department of Labor has estimated that between 2 and 5 percent of the workforce was absent from work on any given day in 2011 and one survey suggests that absences may amount to as much as 35 percent of an employer's payroll1. Given these high costs, many employers are interested in implementing programs to reduce employee absence.
Employers interested in implementing an absence management strategy should utilize an integrated programming that takes in consideration all federal, state, and company leave policies.
What are the Implications of Absence?
Absence can have both direct and indirect costs when it is not managed effectively. Direct costs include obvious factors, such as time lost or lower productivity. Direct costs may also include presenteeism: employees reporting to work when they are too sick, stressed, or distracted to be productive.
Indirect costs are associated with the effect of employee absence on the rest of the workforce, including a negative impact on the morale and the productivity of other workers.
If absences are not managed effectively, they may lead to a culture of absenteeism and a decreased level of engagement from all workers. Reducing unnecessary absences and returning employees to work is important for any business.
What is Absence Management?
Absence management consists of monitoring attendance in the workplace and implementing procedures to reduce loss of productivity. Unfortunately, many employers are having difficulty managing leave, coordinating benefits and understanding which laws apply in a specific situation and how different laws interact with one another.
A variety of laws can have an impact, including the Americans with Disabilities Act as amended (ADA), state workers' compensation laws, and state family and medical leave laws. FMLA and ADA regulations specify that they do not override other applicable laws, and where multiple laws apply to a leave situation, the FMLA and ADA should be coordinated with other laws. To understand how the FMLA, ADA, and workers' compensation laws interact, it is important to understand the legal basics of each law. See EARN's Guide on ADA and FMLA for more details.
Legislation has changed dramatically and continues to evolve at the state and federal level, creating increased complexity for employers. To measure current trends and promote best practices, several studies have been conducted by industry experts. Aon Hewitt, a global human resources consulting and outsourcing company, conducted The Mechanics of Absence Management that surveyed 200 employers, representing 3.2 million employees with 25% of employers from manufacturing (diversified manufacturing, aerospace, automotive, chemicals, and consumer products) and 75% nonmanufacturing sectors (health care, retail, insurance, banking/finance, telecom, utilities, transportation, and education)2. The survey revealed four key themes: compliance is considered, by far, to be the most important factor to a successful absence management program; outsourcing Leave of Absence/FMLA is steadily growing; the complexity of FMLA and state leave administration remains a challenge; and lastly, integration with other human resources disciplines is a high priority for employers that outsource. Six out of ten employers believe it is "highly important" that their absence management be integrated with other human resources functions.
According to the 2011 Employer Leave Management Survey, jointly sponsored by the Disability Management Employer Coalition (DMEC) and Spring Consulting Group, results also indicated that employers found the most difficult requirement in handling FMLA are related to intermittent leave, returning employees to work, and interacting with ADA and ADAAA3. Additional strategies noted in the DMEC study for effective leave management include:
- Develop leave policies that can be provided uniformly across your organization.
- Centralize your approach to leave management.
- Consider outsourcing leave management, particularly if you don't have the internal staff and systems to support it.
- Develop communication protocols with other internal departments: Legal, Employee Relations, Benefits, and others.
- Establish a relationship between HR/Benefits and Risk Management.
Absences, regardless of reason, should be tracked and monitored in order to effectively meet business needs and to create flexible and productive solutions to accommodate and retain valuable employees.
The benefits of an absence management programs may include:
- Decreasing overall absenteeism
- Increasing advance scheduling of absences
- Improving employee productivity
- Increasing employee satisfaction
- Reducing lost time and direct costs of disability or workers' compensation
- Increasing return to work rates
What is Included in an Effective Absence Management Program?
An absence management program should include an easy to understand policy that outlines attendance expectations and absence reporting procedures. All employees should have access to the policy.
Absence Management programs may use a wide range of strategies to improve employee performance and attendance and utilize processes to encourage early return to work. This may include ergonomic and vocational rehabilitation interventions and modified job or light duty assignments that allow an employee to return to work before they are "100 percent" recovered.
Successful absence management can help the retention of trained, knowledgeable employees while increasing productivity and meet business needs.
Key Components of a Successful Absence Management Program
- Prompt reporting of absences and lost time.
- Mechanisms to maintain contact/connection between employee and workplace.
- A process for providing job accommodations and job/duty modifications to prevent or reduce the length of an absence.
- A process for monitoring the transition from modified duty to full duty status.
- A return to work program, often including a flexible workplace arrangement.
Workplace Flexibility as a Component of Absence Management
Workplace flexibility is a key part of absence management and can help decrease unexpected absences. Workplace flexibility refers to a process whereby employers alter the time and/or location of an employee's work on a regular or temporary basis.
Through the use of Flexible Work Arrangements (FWAs), employers can create a manageable and predictable plan that accommodates the needs of employees, while also ensuring that they accomplish the tasks required for their position 4. SHRM considers FWAs to be a critical component of modern workplace policy for all employees. They may be especially critical in allowing most workers, but especially people with disabilities and aging employees to balance both work and personal commitments.
Examples of Flexible Work Arrangements
- Non-traditional start and end times
- Flex time (flexible working hours)
- Compressed workweeks
- Part-time work
- Job sharing
- Part-year work
Work Location Flexibility
- Telecommuting - using personal computers, networks, and other communications technology to do work in the home that is traditionally done in a workplace
- Working from a satellite location or other work spaces
- Reasonable accommodations for persons with disabilities
- Phased or partial retirement for older workers
- Predictable scheduling
- Altered shift and break schedules
- Mercer Health & Benefits, LLC. (2010). Survey on the Total Financial Impact of Employee Absences. Mercer. Portland, OR. Aon Hewitt (2011)
- Aon Hewitt. (2011). The Mechanics of Absence Management: Effectively Administering Absences and the FMLA. Aon Hewitt. Chicago, IL
- Disability Management Employer Coalition (DMEC). (2011) DMEC Employer Leave Management Survey. San Diego, CA
- Workplace Flexibility, 2009
Disability Management Employer Coalition<http://www.dmec.org/>
The Disability Management Employer Coalition (DMEC) provides employers with information, strategies and resources to improve workplace productivity through better absence and disability management.
Just Ask: Integrating Accessibility Throughout Design<http://www.uiaccess.com/accessucd/index.html>
This books provides information to help organizations improve their products—websites, software, hardware, and consumer products—to remove accessibility barriers and avoid adding new barriers.
Employee Assistance Programs for a New Generation of Employees<http://www.dol.gov/odep/documents/employeeassistance.pdf>
The Department of Labor's Office of Disability Employment Policy (ODEP) defines Employee Assistance Programs and elaborates on the benefits of these programs for both employees and employers. The new millennium generation of workers are defined and their EAP needs are considered.
Job Accommodation Network<http://www.askjan.org>
The Job Accommodation Network (JAN) is the leading source of free, expert, and confidential guidance on workplace accommodations and disability employment issues. JAN is the most comprehensive job accommodation resource available.
Personal Assistance Services<http://www.dol.gov/odep/topics/PersonalAssistanceServices.htm>
This resource from the Department of Labor provides a brief explanation of traditional personal assistance services, work-related services, and references to additional information.
USDA: TARGET Demonstration Center<http://www.dm.usda.gov/oo/target/services/techdemos.html>
TARGET works with employers, employees, managers, IT professionals, and procurement officials to find appropriate, cost-effective solutions for employees with disabilities and ergonomic related needs. Expert staff are available to provide demonstrations, assessments, equipment loans, web accessibility training, and disability legislation education.
Flexible Workplace Arrangements Resources<http://www.dol.gov/odep/categories/workforce/fwas.htm>
This Department of Labor Office of Disability Employment Policy guide provides information on how to find information on flexible workplace arrangements.