Tag Archives: cost of absence

Autumn Statement and the Spending Review spell further commitment to reduce long-term absence

Tougher checks for disability benefits?

The Daily Mail wrote today, 25 November 2015, that George Osborne was expected to introduce new rules in awarding benefits to the long-term sick in his Autumn Statement. Today’s Spending Review does outline a vague plan of reforms Continue reading

XpertHR Absence Survey 2015 – Cost of absence still just guesswork

On 5th October, XpertHR published the findings from its Absence Survey 2015. Their survey respondents from 670 companies declared an average absence level of 2.8% or 6.5 days per employee per year. The CIPD annual absence survey normally reports absence figures using the median value to avoid the numbers being skewed by extremely high or low absence figures. To provide an easier comparison, XpertHR study shows a median of 2.5% (5.7 days). In 2015, CIPD reported a median absence level of 6.9 days per employee, up from 6.6 in 2014. In terms of cost of absence, XpertHR survey reports an average cost of absence of £561 per employee per year. This can be compared to CIPD’s median cost, which for 2015 is £554.

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The indirect cost of absence – infographic

Absence is a major cost to business but it can be hard to quantify just how much it costs. The total bill is partly made up of direct costs such as agency or overtime fees for replacement staff and sick pay, which are relatively easy to calculate. If you’d like to calculate your direct cost of absence, try our absence cost calculator.

The rest of absence costs are much harder to put a price tag on because they include things like staff and client retention, client satisfaction, penalties for missed SLAs, reduced productivity and, to a large extent, management time. We’ve analysed the time spent by an average manager of a team of 10 on absence-related tasks in this infographic. The results are staggering: an average manager spends 20 working days each year managing absence. 20 working days – or 1 calendar month – that could better be spent on more value-adding tasks if the absence level was lower.

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How to make HR a profitable business function

Consider this scenario: a company of 1000 employees with 8% absence level (equal to 18 days per employee per year). With little data to base management decisions on and no line management ownership, the absence problem was not being addressed. In some areas, the management teams routinely over-staffed in order to make up for the expected no-shows. Continue reading