There are two key issues to be aware of regarding managing absence:
- Keeping accurate records
- Encouraging the right behaviours
These apply equally to both sickness absence and to holiday absence.
How records are kept of who is off sick and for how long can vary considerably from one company to the next. Some businesses leave it to HR; others expect managers to keep track and notify payroll; many rely on spreadsheets and paperwork to manage absence as it happens. Statutory sick pay typically kicks in after five sick days. A problem arises if this is missed and more sick days are then paid at the full rate rather than the reduced one. That lack of control clearly costs the business money – particularly if administrative safeguards are not robust or consistent.
In the same way, keeping track of holidays and ensuring the right number of days are taken is complicated, especially if different members of staff have different allowances as is common in most companies. The big issue from a financial perspective is when holidays are not managed properly and time off ends up having an impact on productivity. For example, it’s a common issue for companies to experience a holiday ‘bottleneck’ towards the end of the holiday year as lots of staff rush to use up their remaining days before the year end rather than run the risk of losing out completely. Similarly, at popular times such as school holidays, multiple staff members will want to be off the same time. Trying to run the business efficiently and keep customers happy when key members of the workforce are on holiday at the same time is not easy – and in many cases proves impossible. Again, that lack of productivity and efficiency costs the business money.
Certain behaviours around absence can also become an issue for businesses. Not taking regular breaks or time away from the job can lead to increased stress levels, a downturn in staff wellbeing and ultimately an increased likelihood of going off sick. In the most serious cases, a staff member suffering from work-related stress is eventually signed off as long-term sick and that is far more difficult to manage and obviously has a cost impact too.
Finance directors should be aware that absence management software can make a big difference.
For starters, it removes inaccuracies and the risk of errors that inevitably occur in paper or spreadsheet reliant systems. But as well as reducing the costs associated with inadvertent mistakes, an efficient absence management software solution delivers several other less known money saving benefits too. Users of Access TeamSeer report up to a 25% reduction in the cost of sick leave, which many attribute in part to a change in attitude due to greater visibility of absence. Others have also reported an 85% reduction in absence-related administration, freeing up valuable resources to focus more time on value-adding or cost-generating activities.
And finally – although it’s much harder to measure, many TeamSeer system users report a more positive attitude generally towards absence. Ease in processes, greater perceived fairness, and more give-and-take amongst colleagues are all potential positives. Plus, an efficient system makes it much easier to introduce improved holiday benefits which can be complex to administer – such as incremental days for long service and holiday rollover. These are usually popular with staff and help with employee recruitment and retention – again a money saver.
All in all, isn’t it time for finance directors to advocate investment in absence management software?