The Cost of Absenteeism

Absenteeism is a growing concern in many organizations and can cost an organization thousands, if not millions in operational losses.

One way to reduce absenteeism is by rewarding employees for behaviours; even time and attendance behaviours that are normally un-noticed at most larger organizations.

Here is some research that our partner’s client has made for their cost of absenteeism at a call centre of about 800 employees:

• The true number of cost savings for this client was $2.2Million after implementation of a rewards and recognition program. Our partner cannot take all the credit because the organization made a few internal organizational changes, but with the ability to drive behaviours such as attendance, an organization will have the ability to save operational costs due to increased operation efficiency and decreased absenteeism.

The combination of TimeTECH’s workforce management solutions – used for tracking employee’s time and attendance practices and I LOVE REWARDS’ systems used to reward employees behaviours - companies would be able to track and monitor time and attendance, and be rewarded for good behaviour; resulting in a reduction of absenteeism for the given organization.

What is Low Employee Satisfaction Costing Us?

Current Absenteeism Run Rate 10% Due to:

• Low morale, no true feeling of “team” instilled - holding people accountable to their peers and fellow team members




• Lack of education and communication providing employees an opportunity to understand the impacts of their contribution




• Lack of recognition for “Living the Vision”




• Cost of absenteeism for 800 employees at an annual salary of $40K is $3.2M




• An operational savings of $320K for every basis point we can reduce absenteeism




• Low Morale / Lack of Education of Contributions= Low Productivity




• Lack of recognition and communication results in employee dis-engagement and decreased productivity




• Assumed 5% reduction in productivity for 800 employees at an annual salary of $40K is $1.6M




• An operational savings of $160K for every basis point we can increase productivity