Managers are faced with problems of absenteeism day in and day out as they lose production and profits, notwithstanding some of the excuses are legitimate while others are downright dishonest.
This collection of money saving ideas focuses on what to do to curb absenteeism.
Some of the ideas have already been tried and reported as highly successful by enterprising employers who had suggestion plans and paid out bonuses to employees who submitted money saving ideas.

Only big ideas can save your company money, right? Wrong!

Cost Saving ideas are everywhere and you can find them everyday if you know where to look.

Most people just fail to recognize the potential for cashing in.

Take, for example, the September 1984 case of a terminally ill cancer patient living in Fort Lauderdale, Florida. He advertised that, when he died, he would deliver messages to dead friends or relatives of anyone who would pay $20 for the service.

To everyone’s surprise, he was swamped with calls from every part of the U.S. He even received calls from as far away as England and Australia.

Every idea in this article is a money saver. On the surface it may appear that some ideas are too simple or too outrageous to even bother with. Don’t let that fool you. If you don’t save or make money from these ideas, it is because you didn’t take the appropriate action.

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ACTION! ACTION! ACTION! This is the key to saving money. And not one idea is worth a nickel without it.

Millions of terminally ill patients have probably had the same idea as the dying man above, but he is the only one to take the action. He has taught us that it is not the idea that makes a difference, but the energy and action of those who follow it up.

Achieving Maximum Savings from These Report

Many of the ideas in this series of reports will be instrumental in saving your company a small fortune. The suggestions are all proven winners, some of them have already been credited with savings in the hundreds of thousands of dollars, and many of them have earned workers substantial monetary awards through employee suggestion plans.

One way to take advantage of the savings outlined in these articles and to uncover the specific savings applicable to your environment, is to evaluate each idea and start applying those which will produce the largest saving at first.

To be even more effective, you could organize a cost control committee with three to five dependable people and ask each to evaluate all of the ideas, and to estimate their potential savings.

To be sure each assessor applies him or herself 100 per cent, create an atmosphere of competition in which material rewards are offered to the assessor who can save your company the most money. (The competition alone will drive these people far beyond their present potential.)

In the meantime, you will discover that each assessor has his or her own ideas. You should take those ideas and evaluate them in the same manner. In the end, you will find savings beyond what you thought possible, and this will provide an enviable record for your department.

p.s. It is because of people like you that these articles

have been written, let us know of your successful cost-cutting ideas and we will make an effort to include them in our future editions.

Other articles in this series of cost cutting ideas:

Money Saving Suggestion for Business

Don’t Get Caught Cheating on Taxes: A Cautionary Tax-Evasion Reminder

About The Author

John P. Stewart is a correspondent for over 150 trade journals around the world. Based in Montreal, Canada, much of his work since 1979 has been on finding cost-cutting and production- improving ideas for business, trade and industry.

John P. Stewart’s experience is not limited to the office. Before his work as a world correspondent, he spent more than 25 years on a shop floor, rising from the ranks of welder-fitter, to flame straightening specialist, to cost-consultant in the metalworking industry. While working as a consultant, he wrote six books destined for the welding industry, detailing more efficient working methods and cost cutting techniques.

He was nominated for the 1985 Fabricating Industry’s Award of Excellence for his publication entitled Flame Straightening Technology.

In this chapter we are going to offer suggestions to curb absenteeism and in the process help you to understand the principal reasons that allows absenteeism to exist, some of these ideas have already been tried by enterprising managers and posted as being surprisingly successful.

Absenteeism Cures

Using Gentle Intimidation

Out of frustration, many companies have resorted to contests and give-aways to alleviate the problem of absenteeism. The Health Insurance Association of America has indicated that every workday, more than one million American workers call in sick, which means at least 330 million workdays lost each year.

The age old practice of calling to task, although watered down to a gentle form of intimidation, is one of several effective way of curbing absenteeism.

After you have tried an informal discussion about the problem with no success, the next step, says Quarterly training News (put out by the Advanced Management Center at Dalhousie University), is a memo that chronicles the specific dates of absence. This memo should include the company policy being violated, along with a statement about what the employee has to do to improve within a review period. The offending employee should be given the opportunity to sign the memo, indicating that he has read and understood it. At the end of the review period, the employee’s absenteeism record should be evaluated and a decision made about future action. This action will make a chronic offender think twice before being absent again. The truth about chronic absenteeism is that it exists only because it is tolerated.

Establishing Criteria

Absenteeism can be reduced by providing each employee with a detailed job description, and by providing each job with minimum attendance, physical and mental health, and performance standards.

With these in place, you now have criteria which, if not met, indicate that a specific employee is not performing or cannot perform his job. You could then bring sanctions against workers who do not meet the established standards.

If the problem is medical, you should determine whether the excuse is legitimate and if so, whether treatment will result in the employee being able to return to the job. Have employees produce medical certificates.

But, be cautious when reviewing medical certificates. An acceptable certificate should state the dates the patient was seen, a diagnosis, and a prognosis. The note should also indicate whether or not the employee is fit to return to normal duties, or whether his activity should be restricted. Any other form of medical certificate is useless.

To process a medical certificate, and to decide as to its legitimacy, a proper note should not just be given to the personnel officer, and tossed into a file. Companies should have, at least, a part-time doctor or nurse either on or off site. The medical consultants should review the medical certificates and conduct a brief physical. Once done, the consultants should inform the employer of the situation. Meanwhile, the diagnosis, which is not the company’s business, remains confidential in the files of the company. No employee wants the lunchroom gossip to be centred around his genital herpes.

Exercise Program

The cost benefits of an employee fitness program were measured in a widely quoted 1978 Canadian study of more than 1,000 life assurance workers. Canada Life Assurance Co. calculated an overall saving of $250,000, or 1 per cent of payroll, based on a rate of 28 per cent participation in a fitness program.

The 10-month study by the University of Toronto compared employees at Canada Life who exercised regularly with a control group of non-exercisers at North American Life Co.

The Canada Life fitness classes were held in a basement storeroom for 30 minutes three times a week. They attracted 35 per cent of workers. After six months, participants were doing 17 minutes of aerobic exercise at each session.

Job satisfaction increased during the study, and employee turnover went down from 15 to 1.5 per cent, among Canada Life’s exercising employees. Since the company estimated the cost of hiring and training a new supervisory-level employee at $8,600, the savings from reduced turnover could be substantial.

There was a saving of $84 a year in medical costs for each exercising employee and their absenteeism dropped by 22 per cent, an average of 1.3 days per worker annually.

New Wage Scales

Providing a higher salary or bonus to employees who complete a full week’s work is another way to reduce costly absenteeism.

The idea involves creating two wage scales for hourly paid employees instead of the usual one. For a specific employee, for example, an hourly rate of $15 or $16 can be in effect, depending on his weekly attendance record. If a full 40 hours are worked, the worker receives the top rate. If for any reason less than 40 hours are worked, the worker is paid at the lesser rate for that week.

Lucky Draws

General Motors of New Zealand reduced absenteeism to 5 per cent from 10 per cent by proceeding with weekly draws for cash. The only rule was that workers who were either late or absent at least once the week before were not eligible. The idea was copied by Bata Co. of New Zealand and it reduced absenteeism to 5 per cent from 15 per cent.

Dialing Up Culprits

If none of the above ideas interest you, you may want to copy a Chicago high school principal who woke often-absent students and staff at 6 a.m. by phone.

“Good morning. This is Dr. Walter Pilditch with a recorded wake- up call. You are continually late, or absent. I will continue to make this call until the problem is solved. Thank you for your co-operation.”

The robot-dialed reveille calls were credited with cutting tardiness and absenteeism by more than 50 per cent in a school with more than 2,500 students and staff.

Curbing Absenteeism

Spot Workers Faking Injury

Workers faking injury are costing business and government millions of dollars each year in injury claims and lost production.

In a 1984 study by the President’s Private Sector Survey on Cost Control, it was revealed that taxpayers could save up to $100 million a year just by having investigators crack down on civilian workers who free-load off the federal disability program.

Emory University’s Pain Control Center in Atlanta, Georgia, has developed a Faker profile to aid managers in spotting a worker faking an injury. According to Emery University, the following marks a faker:

The worker will often not show up at the pain clinics for his or her first appointment and will not make an effort to cancel or postpone the meeting.

The employee has no words to describe the pain felt, but is overly dramatic and gives an unprompted denial that he or she is malingering.

The worker shows poor willingness to be evaluated for his or her disability and exhibits an overall lack of commitment to physical therapy.

The employee gives evidence during the initial interview that he realizes there is an economic gain to be made in connection with chronic pain behavior.

The worker has a history of manipulative behavior.

The worker’s report on his pain disagrees with reports from his spouse or other family members who are asked for their reaction in separate interviews.

Before being asked, the worker brings up his fervent desire to get back to work.

Preventing Illness

Sometimes companies must take a lead in preventing illness among employees in order to prevent costly absenteeism.

Northern Telecom Ltd. of Mississauga, Ontario, estimated its 1990 flu vaccine program for employees saved the company at least $120,000 in lost time costs.

Flu shots were made available to any of the 22,000 employees at the company’s various subsidiaries who wanted them.

Safety Bingo

Wisconsin Centrifugal Inc. (800 employees), in Waukesha, Wisconsin, is said to have saved $1 million a year since introducing a game called Safety Bingo in 1978. The game rewards employees with prizes of up to $1,000 for avoiding accidents. On average, 90 per cent of employees win at least $25 every three months.

The game consists of distributing bingo cards to employees and calling at least one number each day. Like in regular bingo, this continues until someone gets bingo and wins the cash prize. However, if there is a loss-time accident during the game, the game is either cancelled and a new game started, or play is suspended for a day or two.

According to the former employee relations manager of Wisconsin Centrifugal Inc., the company’s average of 60 lost-time accidents a year in 1976 and 1977 resulted in more than 4,000 lost days. In the year following implementation of Safety Bingo, only six such accidents occurred, costing the company fewer than 100 lost days. Suspicious injury claims such as back injuries and muscle pulls all but disappeared.

Eliminating Health Hazards

Before concluding that absenteeism is always an attitudinal or behavioral problem, look around for other possible sources. Humidifiers, for instance, may be the cause of absenteeism in your company. Recent evidence shows that the use of humidifiers may not be the best and safest way to add moisture to our living environment. Allergy and air quality specialist Dr. James Day of Queen’s University in Kingston, Ontario, said that water left sitting in most types of humidifiers becomes stagnant and acts as a breeding ground for bacteria and fungi, which are then blown into the air and trigger health problems.

The sources are usually more obvious, however. Doors or windows may be left open causing a draft, air conditioning may be set too high thus overcooling offices, workers may be outside on the job in winter without jackets.

Other articles in this series of cost cutting ideas:

Sources of Free Print and Broadcast Publicity

Recession Proof Your Business