Turnover and Absenteeism
Absenteeism is a pattern or habit of an employee missing work, often for no good reason.
Turnover is the number or percentage of an employer’s workforce that must be replaced due to the voluntary and involuntary separation of employees from employment. Voluntary turnover includes leaving employment to retire, illness, returning to school and better career opportunities, while involuntary turnover includes layoffs and terminations for poor performance or disciplinary problems.
Absenteeism and turnover vary by occupation, company and industry. Health care, emergency services, customer relations and manufacturing have high absentee rates — between 6 and 11 percent — reports the workforce solutions company Circadian. Rates are calculated as a percentage of an organization’s total workforce. You can slow absenteeism and turnover by understanding the causes and tracking the costs to your business.
Scheduled absences occur when workers plan to use vacation days and paid time off. Unscheduled absences result in using sick days and family medical leave, or staying off the job because of disability or a workers’ compensation injury. Partial-shift absences occur when employees are late for work, leave early and take extended lunch or leisure breaks. All absences can be costly workplace disruptions over time.
Turnover is the annual percentage of employees who voluntarily leave companies and must be replaced. Layoffs, firings and furloughs are company decisions and therefore not included in tracking turnover. A 20 percent turnover rate means that one in five employees has left a company within a year. High turnover often correlates with high absenteeism.
Personal illness is the reason workers give most often for unscheduled absences, according to the 2007 CCH Unscheduled Absences Survey. Other reasons are family issues and personal needs, followed by feelings of entitlement in taking time off and stress. Turnover is high in companies where employees generally feel undervalued, disrespected, ignored or unappreciated. Better job opportunities or higher pay are additional causes of turnover but not always the top reasons employees leave.
High absenteeism and turnover have indirect and financial costs. Productivity drops when companies are understaffed, as can the quality of goods and services. Employees must fill in for absent or departed co-workers on top of performing their own duties; overworked employees are prone to fatigue and illness, which can compound absenteeism. Also, customers become dissatisfied when businesses lack the number of workers needed to meet their demands.
Tracking the number of absences, voluntary leaves and associated costs helps you determine if your absenteeism and turnover rates are too. Absenteeism rates are calculated by dividing the number of lost working days in a month, year or other time frame by the total number of workdays in that time period; multiply the result by 100 to get a percentage rate. Turnover rates are calculated by dividing the number of staff departures in a given time period by the average number of employees for that time period; multiply the result by 100 to get the percentage.