effect and impact of employee absenteeism and …

Volume:01, Number:05, Sep-2011 Page 298 www.theinternationaljournal.org

EFFECT AND IMPACT OF EMPLOYEE ABSENTEEISM AND

PERSONNEL CONSTANT TURNOVER IN AN ORGANIZATION

Raj Kumar Singh

Research Scholar

Singhania University,

Rajasthan

Dr. Parul Khanna MBA, Ph.D

Assoc. Prof. & Dean R&D,

Institute of Management & Technology,

Faridabad

Abstract:

Productivity loss due to absenteeism is a serious and growing challenge. In the United States,

the annual cost to employers for time lost due to accidents is almost $100 billion, and other

unscheduled worker absences costs even more. Absence management is a growing body of

knowledge and experience that managers apply to the control and reduction of these costs.

Many organizations are struggling to find the ideal remedy for increased unscheduled

employee absenteeism.

Volume:01, Number:05, Sep-2011 99 www.theinternationaljournal.org

ABSENTEEISM:

The scheduled time off from work which occurs when, an employee is not present at work,

during a normally scheduled work period.

Excused absences are scheduled in advance for such events as vacation, medical

appointments, military service, family activities, surgery, jury duty, funerals and more that

cannot be scheduled outside of regular work hours.

EMPLOYEE TURNOVER

In view of human resources management and organizational behaviour, the classical

employees’ turnover is the rotation of employees around the labour market between firms,

jobs and occupations, and between the states of employment and unemployment (Abassi et

al., 2000).

The term “turnover” is defined by Price (1977) as the ratio of the number of organizational

members who have left and divided by the average number of people in that organization

during the period. However, the managers frequently refer to turnover as the entire process

associated with filling a vacancy: each time a position is vacated, either voluntarily or

involuntarily, a new employee may be hired and trained.

Research Objectives:

This paper will focus on the impact that the absenteeism and the constant turnover of

personnel have in the organizations and the causes of this common situation. It will also

present prevention programs and strategies to overcome the negative effects, like motivation,

communication, career planning, retention programs, and training. The purpose is to

determine the reasons why employees skip their working schedules or change jobs

continuously. These reasons will be found by a survey applied to different people. After

knowing the reasons, it will be easier to find out which programs will help organizations

avoid these high rates of absenteeism and turnover.

Research Methodology:

The target population for this study consisted of respondents from three groups within the

company, namely, Managers, Supervisors and Workers at C & S Electric Limited,

Noida.

The total headcount1 within the factory was taken into account in determining the number of

respondents to be taken from each of the three groups (Managers, Supervisors and Workers).

It would not have been feasible to include all employees in the company as that would have

required the preparation, issuing and collection of 650 survey questionnaires. Instead, a non-

1 The total number of employees (Managers, Supervisors and Workers) at C & S Electric, Limited, Noida is 650 as per the data provided by the HR Head of the Organisation.

Volume:01, Number:05, Sep-2011 00 www.theinternationaljournal.org

probability convenient sample, consisting of 120 respondents, representing all three groups,

was selected.

The researcher issued exactly 120 questionnaires to the HR Administrator at the factory

premises. These questionnaires were issued to the predetermined number of Managers,

Supervisors and Workers.

The HR Administrator succeeded in retrieving the full complement of questionnaires issued.

A 100 percent response rate was therefore achieved in respect of the number of

questionnaires issued and the number of completed questionnaires received from the

respondents. This was largely due to a well-controlled questionnaire administrative process.

The results were presented in tables, and a cross-tabular analysis was made by means of

descriptive statistical analysis. This required an analysis of the Mean Scores2 and the

Standard Deviation3 and Population Standard Deviation

4. In addition, an inferential

statistical analysis was done by means of the one-way ANOVA (multivariate analysis)5 to

determine whether there is a statistically significant difference between the mean scores of

the three groups (Managers, Supervisors and Workers).

These tests indicated whether there were statistically significant differences between the

responses obtained from managers, supervisors and employees. The independent variables

identified for purposes of analysis were the monitoring and management of absenteeism.

Based on the survey results of the literature survey and empirical survey, recommendations

were provided to improve the Absenteeism and Personnel Constant Turnover monitoring and

management system at C&S Electric Limited, Noida.

This research article presents the analysis of response obtained from the survey

questionnaires distributed to the respondents.

The first and foremost research objective is sought to identify and analyse the effect and

impact of absenteeism and personnel constant turnover on the organizations specifically the C

& S Electric Limited, Noida, India, by demographical analysis of total surveyed Managers,

Supervisors and Workers in the categories of: gender, age, designation, total work

experience, current company job experience and marital status.

The second Research objective is focused to analyze the details about the effect and impact

of absenteeism and personnel constant turnover on the organizations specifically the C & S

2 For a data set, the mean is the sum of the values divided by the number of values. The mean of a set of

numbers x1, x2, ..., xn is typically denoted by x , pronounced "x bar". This mean is a type of arithmetic mean. If

the data set were based on a series of observations obtained by sampling a statistical population, this mean is

termed the "sample mean" (x) to distinguish it from the "population mean" (μ or μx). 3Standard deviation is a widely used measurement of variability or diversity used in statistics and probability

theory. It shows how much variation or "dispersion" there is from the average (mean, or expected value). 4 Population standard deviation, in a statistical sense, deals with the amount of variation one would expect to see

in a population, for some given attribute. To determine the actual standard deviation for a population, you would

have to sample each individual member of a population for the specific trait you are investigating. 5 In statistics, analysis of variance (ANOVA) is a collection of statistical models, and their associated

procedures, in which the observed variance in a particular variable is partitioned into components attributable to

different sources of variation. In its simplest form ANOVA provides a statistical test of whether or not the

means of several groups are all equal, and therefore generalizes t-test and are useful in comparing two, three or

more means.


Electric Limited, Noida, India, Further, the various strategies that can be adopted to reduce

and curb the absenteeism and the personnel turnover have been discussed.

The third Research objective is sought to analyse the relationship between the respondent’s

opinions with reference to the effect and impact of absenteeism and personnel constant

turnover on the organizations.

A 32-item structured opinion survey with a 4-5 point scale will be used. This survey will

evaluate respondent’s perceptions in 11 key dimensions:

I. Background: This is sub-divided into:

a. Corporate Plan/Departmental Plan (Questions 1-2)

b. Policy (Questions 3-5)

c. Disciplinary Procedures (Questions 6-7)

d. Time constraints (Questions 8-9)

e. Rating of Attendance (Questions 10-11)

II. Job & Work Culture (Questions 12-20)

III. Job Satisfaction (Questions 21).

IV. Motivators for Job Satisfaction (Question 22-23)

V. Causes of Employee Absenteeism (Questions 24)

VI. Strategies to curb Absenteeism (Questions 25)

VII. Causes of Employee Turnover (Questions 26)

VIII. Strategies to curb Personnel Constant Turnover (Questions 27)

IX. Impact of Absenteeism (Questions 28)

X. Absenteeism Management (Questions 29)

XI. Miscellaneous (Question 30-32)

1.1 Descriptive Statistics on Demographical Factors of the respondents

In section A of the questionnaire respondents were required to provide information about

their gender, age, designation, total work experience, current company job experience and

marital status. Further the section unfolds their perception of absenteeism in the company as

well as their own level of absenteeism, whether they had access to the absenteeism policy and

whether they understood the policy.

The information obtained from these questions in section A is presented and discussed below.

A total of 120 questionnaires were issued and all the questionnaires were returned. Table 1.1

provides a tabulated composition of the respondents:

1.1: Categories of Employees Surveyed:

Table 1.1.1: Number of people included in the study

Category Number of Respondents Percentage

Managers 31 26

Supervisors 28 23

Workers 61 51

Total 120 100%


In addition to Table 1.1.1 the following Chart 1.1.1 represents the data visually:

Chart 1.1.1 Categories of employees surveyed.

It is evident from the above mentioned table and chart that the non-supervisory and the non-

management employees i.e., workers were the majority participants in the study (n=61; 51%)

followed by the Managers of various departments (n=31; 26%) and finally the Supervisors

(n=28; 23%). The number of respondents is therefore representative of the number of people

employed by the organization.

1.1.2: Age of Employees Surveyed:

Table 1.1.2: Age of the respondents

Age Group Number of Respondents Percentage

20-30 yrs 38 32

31-40 yrs 36 30

41-50 yrs 32 27

51-60 yrs 13 11

>60 yrs 1 1

It is hereby clear that the maximum respondents belong to the age group of 20-30 yrs. (n=38;

32%), followed by the age group of 31-40 yrs. (n=36; 30%), then the respondents were of the

age of 41-50 yrs. (n=32; 27%), however the age group of 51-60 yrs. Had a respondent

number of 13; 11%. In the age group of more than 60 years only one respondent responded.

Chart 1.1.2: Age Group Classification of the respondents

26%

23%51%

Categories of employees

surveyed

Manager

Supervisor

Worker

31%

30%

27%

11%1%

20-30 yrs

31-40 yrs

41-50 yrs

51-60 yrs

> 60 yrs


1.1.3: Gender of Employees Surveyed:

Table 1.1.3: Gender representation of the total surveyed employees:

Gender Number of Respondents Percentage

Male 86 72

Female 34 28

Chart 1.1.3: Gender representation of the total surveyed employees

The above Table 1.1.3 and Chart 1.1.3 clearly draw a distinction between the gender

representations of the surveyed population. It is evident that the maximum number of the

surveyed population is Males (n=86; 72%) where as the female population is (n=34; 28%).

1.1.4 Total Work Experience:

Table 1.1.4: Total number of work experience of employees:

Total Experience Number of Respondents Percentage

0-2 yrs. 15 13

2-5 yrs. 32 27

> 5 yrs. 73 61

Chart 1.1.4: Total number of work experience of employees

0

20

40

60

80

100

R %

8672

34 28

Male

Female

13%27%61%

0-2 yrs.

2-5 yrs.

> 5 yrs.


Out of the total number of surveyed population majority had an experience of more than 5

years (n=73; 61%) followed by employees with 2-5 years of work experience (n=32; 27%)

and only 12% (n=15) of the employees said that they have a total work experience of 0-2

years.

1.1.5 Current Company Work Experience:

Table 1.1.5: Work experience of surveyed respondents in C& S Electric, Limited:

Total Experience Number of Respondents Percentage

0-2 yrs. 19 16

2-5 yrs. 26 22

> 5 yrs. 75 63

As far as the work experience of the surveyed population in the C & S Electric Limited is

concerned, the majority of the respondents self-reported that they have been working in this

organization for more than 5 years now (n=75; 63%); however 22% (n=26) reported to have

worked for 2-3 years and just 16% (n=19) reported that they are here from the last two years.

This has been visually shown in the Chart 1.5 below:

Chart 1.1.5: Work experience of surveyed respondents in C& S Electric, Limited

1.1.6 Marital Status:

Table 1.1.6: Marital Status of the surveyed respondents in C& S Electric, Limited:

Marital Status Number of Respondents Percentage

Single 26 22

Married 94 78


Chart 1.1.6: Marital Status of the surveyed respondents in C& S Electric, Limited

The above Table 1.1.6 and Chart 1.1.6 clearly draw a distinction between the marital status

representations of the surveyed population. It is evident that the maximum number of the

surveyed population is Married (n=94; 78%) where as the single/unmarried respondents is

(n=26; 22%).

I. Various causes of employee absenteeism

Table 1.2.1: Causes of employee absenteeism

S Tech. Env. R M. Style R Pers. Fac. R Ext. Fac. R

1 Conditions of

Work & hrs.

of Work

29 Quality &

style of

Supervision

29 Marital

Harmony

32 Level of

Unemployment

27

2 Accidents 81 Selection,

Induction &

placement

25 Family size

& resp.

37 Social,

Religious &

Cultural Aspects

35

3 Occupational

diseases &

Medical Care

67 Job

satisfaction

&

Challenges

37 Work

orientation,

Leisure

26 Time of the year

& day of the

work

41

4 Work Group 23 Wages &

Incentives

31 Bad Habits 11 Climate &

Related

conditions

32

5 - - Leave Rules

&

procedures

23 Emotional

Health

11 Housing (local) 15

6 - - Role of

Unions

13 Community

&

Obligations

13 - -

7 - - - - Transport 9 - -

8 - - - - Housing 7 - -

9 - - - - Std. of

Living

8 - -

10 - - - - In-debtness 13 - -

Total 200 Total 158 Total 167 Total 150


Solution

Null Hypothesis

Ho: µ1= µ2= µ3= µ4 i.e. causes of absentees are similar.

Table 1.2.1: Solution: Causes of employee absenteeism

S. No Technological

Environment (X1)

Managerial

Style (X2)

Personal

Factors

(X3)

External

Factors

(X4)

Total

1 29 29 32 27 117

2 81 25 37 35 178

3 67 37 26 41 171

4 23 31 11 32 97

5 - 23 11 15 49

6 - 13 13 - 26

7 - - 9 - 9

8 - - 7 - 7

9 - - 8 - 8

10 - - 13 - 13

Total 200 158 167 150 675

N 4 6 10 15 35

∑ X 200 158 167 150 675

Mean 50 26.33 16.7 30 27

∑ X2 12420 4494 3843 4884 25641

Variance 806.67 66.67 117.12 96 309

Standard

Deviation

28.4 8.17 10.82 9.79 17.57

Standard Error 14.2 3.33 3.42 4.38 3.52

Standard Weighted- Mean Analysis

Table 7.2.1: Standard Weighted- Mean Analysis

Source SS df MS F P

Between Groups 3324.56 3 1074.85

5.39 0.006 Within Groups 4191..43 21 199.59

For V1 =3 & V2 =21, the table value of F at 5% I.o.s = 8.65

Since the calculated value of F is less than the Table Value, null hypothesis is accepted.

and alternative hypothesis is rejected that mean the causes of absentees are almost similar in

all organizations. However the impact of dissimilar causes may be different Technological

Environment is on the peak while external factors affect the least.


II. Managing Absenteeism: Various methods to manage absenteeism

Table 1.2.2: Methods to manage absenteeism

Statement

Always

Sometimes

Rarely

Never

Sum Mean Standard

Deviation

Population

Standard

Deviation

Proper training

to deal with

absenteeism

12 64 24 20 120 30 23 20

Proper

communication

of

Absenteeism

Policies

36 42 17 25 120 30 11 10

Proper

recording of

Absenteeism

82 26 12 0 120 30 36 31

Comparison of

Dept.

Absenteeism

figures

52 38 21 9 120 30 19 16

Display and

explanation of

Cost of

absenteeism

12 36 54 18 120 30 19 16

Adoption of

Disciplinary

Action

77 31 9 3 120 30 34 29

Trade Union

Involvement

52 54 12 2 120 30 27 23

Total 30 24 21

Standard Deviation & Population standard deviation is smaller than mean depicts numbers

are close to their mean, resulting in the variability in the various methods that can be

implemented to manage absenteeism.

Amongst the most popular method to manage absenteeism at the C&S Electric Limited is the

Proper record keeping of employee’s absenteeism rate and probing the causes to

absenteeism.

Apart from the record keeping the next method is to take appropriate and timely

disciplinary actions for non-report to work as well as routine absenteeism from work.


III. Impact of Absenteeism:

Summary of the Mean Scores, Standard Deviation & Population Standard Deviation

Table 1.2.2: Combined Responses:

Q. IMPACT OF ABSEENTISM N MEAN STANDARD

DEVIATION

POPULATION

STANDARD

DEVIATION

Q 2 Reduction of absenteeism, a key

goal within the Departmental

Plan

120 30 31.34 27.14

Q 3 Existence of absence policy 120 30 14.72 12.74

Q 5 Reporting of Absentees 120 30 31.9 27.63

Q 6 Dismissal Policy in place to deal

with recurring and frequent

absence

120 30 21.71 18.8

Q 7 Excessive absences subject to

sanctions

120 30 37.31 32.31

Q 8 Opinion about timings 120 30 38.99 33.77

Q 9 Satisfaction with leave facility 120 30 37.34 32.34

Q 10 Description of attendance in

company

120 30 52.1 45.12

Q 11 Describing own attendance 120 30 35.22 30.5

Q 12 Work environment 120 30 30.73 26.62

Q 13 Work monotonous 120 30 24.23 20.98

Q 14 Explanation of job

responsibilities

120 30 43.3 37.5

Q 15 Options of job rotation 120 30 25.54 22.12

Q 16 Relationship with superior 120 30 34 29.45

Q 17 Relationship with subordinate 120 30 37.63 32.59

Q 18 Relationship with peer 120 30 33.55 29.06

Q 19 Satisfied with the working

condition

120 30 32.34 28.01

Q 20 Improvements in the working

conditions

120 30 30.05 26.02

Q 21 Factors influence Job

satisfaction

120 30 27.54 23.85

Q 22 Work motivating factors 120 45 16.49 15.42

Q 23 Work non-motivating factors 120 45 22.03 20.61

Q 29 Methods to manage absenteeism 120 30 24.13 20.90

Q 32 Satisfied with the general

opinion of the company

120 30 31.03 26.87

An analysis of the mean scores, standard deviations & population standard deviation of the

variables reveals that an average mean score of the responses are almost similar i.e 30 & 45

(in 2 cases since selection of the responses was increased.

The standard deviation of the responses varies among 14.72 to 52.1 it presents how the data

will deviate from the normal number. These tendencies are not only for this year of data but


this can be analyzed effectively to look at the following years. If a trend is able to be

developed then all that will have to be done is a minor tweak to get next year’s perdition.

Mean: Mean = Sum of X values / N (Number of values)

Standard Deviation:

Generally, we are interested in the standard deviation of a population. However, as we are

often presented with data from a sample only, we can estimate the population standard

deviation from a sample standard deviation. We are normally interested in knowing the

population standard deviation as our population contains all the values we are interested in.

Therefore, it is always recommended to calculate the population standard deviation.

Population Standard Deviation:

Population standard deviation gives more accurate picture as to what would be the outcome if

the whole population would have been selected as our target to perform the analysis. The

standard deviation of the responses varies among 12.74 to 45.12 it presents how the data will

deviate from the actual numbers.

IV. Various strategies that can be implemented to curb the employee absenteeism

Table 1.2.4: Strategies to curb employee absenteeism

S. No Opinion Observed

Frequenc

y (O)

Expected

Frequenc

y (E)

O-E (O-E)2 (O-E)

2/E

1 High Collaborative culture 6 6 0 0 0

2 Develop open

communication between

managers, supervisors and

employees

11 15 -4 16 1.0667

3 Regularly scheduled

department meetings

7 10 -3 9 0.9

4 Encourage risk taking &

experimentation among

members

6 7 -1 1 0.1429

5 Awareness, commitment &

involvement by all staff

levels

8 13 -5 25 1.9231

6 Official warnings 9 3 6 36 12

7 Effective training and

development program

13 10 3 9 0.9


8 Awareness of problems

that effect employee

attendance or performance

15 10 5 25 2.5

9 Cooperation with union

representatives

7 2 5 25 12.5

10 Familiarize with

community programs

7 8 -1 1 0.125

11 Bonus for unused sick

leave

13 10 3 9 0.9

12 Counsel individual

employees

10 13 -3 9 0.6923

13 Effective career planning

And development program

8 13 -5 25 1.9231

Total 120 120 35.573

Table Value 2

0.05 for d.f. 12= 21.06 Hypothesis is rejected &

test is accepted

At 95% confidence level, the critical value obtained from the chi –square test is 2

0.05,

12=21.06, 2

is calculated as 35.573 which is more than the tabular value. Hence test is

accepted and null hypothesis is rejected.

2

0.05, 12 21.06 < 2 35.573

Hence, various strategies to curb the absentees must be employed on selection basis rather on

altogether. Since the results of them will be different among the employees as per their

behavior, attitude etc. Awareness of problems is on the apex while culture, risk taking etc.

plays least important.

CONCLUSION

To summarise:

As most employers are aware, that too much absenteeism and turnover can adversely affect

labor productivity. Finding ways to effectively deal with these problems is an immense

challenge. Even an effective program will fail as the behavior of some employees won’t

change, no matter what the company does. Therefore, it is well worth it to proactively address

these problems. Many suggestions for reducing absenteeism and turnover presented in the

categories below were provided.

1. Redefine Overtime

It was established that a common practice for employees is to miss a day of regular pay to

work hours that pay time-and-a-half. Although they have taken a day off, they still work a

40-hour week but get overtime pay for any hours beyond regular work hours. Such workers,

in effect, have given themselves a raise. Some companies have redefined overtime in their

labor agreements as a way of addressing this problem.


It was also found that companies should not offer overtime as an incentive to keep workers

from moving to other jobs. This approach can backfire and will adversely affect budgets.

2. Use Incentive Programs

Mixed responses about incentive programs were noticed. Most of the employees claimed

these programs would help reduce their absenteeism and turnover. However, management

believed that incentive programs don’t work. They felt that employees already receive good

wages. Although the effectiveness of incentive programs was not studied, many ideas from

respondents within the research were received. Workers should receive a reward of tools if 40

hours are worked on a consistent basis. A bonus (shared with apprentices) goes to the lead

installer for completing a project in fewer hours than estimated while maintaining a quality of

work acceptable to the company. This program promotes teamwork. Set up a program where

the employees get a certain bonus for every hour worked but have to have 40 hours worked in

a week, or give workers an extra $100 for working 40 hours the week before.

3. Change Work Schedules

Employees reported that one way to reduce absenteeism was to schedule 40 hours in four

days instead of five. A schedule of 10 hours per day, Monday through Thursday, would

leave employees time on Fridays to conduct business or rest. A missed day under this

schedule would also result in a higher financial loss for workers. Another suggestion was to

schedule four 9-hour days with a half-day on Friday.

4. Establish Safe Work Sites

Research showed that injuries play a key role in absenteeism. Employees also reported

wanting to work on safe construction sites. Potentially dangerous tools, equipment, and

materials exist on all construction sites. Therefore, an ongoing, proactive safety program can

significantly reduce both absenteeism and turnover. Having a good safety record can result

in a company becoming a company of choice. A company of choice is one that proactively

inspires worker productivity and loyalty and thus, has fewer problems with absenteeism and

turnover.

5. Become a Company of Choice

Many of the companies that were surveyed said they did not have much of a problem with

turnover simply because they were a company of choice. Companies of choice enjoy a stable

workforce because their programs and policies build worker loyalty. Following are some of

their methods:

Provide safe work sites

Treat workers with respect

Provide lunch

Host company get-togethers

Promote an “open-door” policy between workers and management

Provide training or assistance with training

Provide daycare or assistance with daycare

Provide flexible schedules


6. Record Attendance Publicly

Supervisors can post the attendance record where all employees can see it every day.

Workers can track their own attendance and also see clearly who is not showing up for work

on a regular basis. This technique demonstrates that management values attendance and takes

absenteeism seriously. Workers who have already missed some time may be reluctant to see

more absences marked next to their names.

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