Indirect cost of absence measured in management time

Absence costs are made up of a lot of parts you may not have considered. The direct costs are perhaps more obvious, but are you aware of everything that makes up the indirect cost of absence?

The Health and Safety Executive lists costs of absence as:

Direct cost of absence

• paying the salary of the absent employee
• overtime incurred by other employees covering for the absent employee
• loss of output incurred by the absent employee

Indirect cost of absence

• the time taken for a replacement to learn the new role and become productive
• possible diminished services and product quality
• loss of business, continuity and reputation
• recruiting temporary or replacement staff
• training and providing support to other staff

£1,805 per year

One of the main indirect costs we identify is management time. Each of the indirect consequences listed above will have a huge impact on the manager having to deal with these issues. Have you considered what price tag that time has? We have done just that. The result is that managing absence in a team of 10 costs on average just over £1,800 per year. Here’s how we worked it out:

Infographic on the indirect cost of absence measured in management time