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Real cost of absenteeism in SA's workplace

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Real cost of absenteeism in SA's workplace

Absenteeism, an employee’s intentional or habitual absence from the workplace, is a growing issue for many South African businesses due to the knock-on effect it creates for productivity, staff morale and a company’s bottom line.


According to Christo Botes, Executive Director of Business Partners Limited, while the impact on larger corporations can be significant, the consequence of regular absenteeism for small and medium enterprises (SMEs) can be detrimental, given that many of these businesses often employ less than 10 employees. 

Botes points to figures released by Statistics SA, which reveal that absenteeism is costing companies more than R12 billion annually. “With SMEs being the key drivers of economic growth, many smaller businesses feel the financial loss of absenteeism considerably, due to the major role that each employee is likely to play within a relatively small team. The continued absence of one or two people within an SME can have a significant effect on a business.”


He says that a positive culture and personal engagement between SME entrepreneurs and their staff can however limit absenteeism - more so than in larger businesses.  “The importance of each team member is more evident within an SME, which results in staff being dependent on each other and aware of the team’s efforts.  


“Involving staff in the performance of the company will also help them to understand the role they play in making the business successful.  It will also result in the staff feeling valued and appreciated.”


A recent survey by CareerBuilder reported that employers noticed an increased number of sick days among their employees around the holidays and that December, January and February are months that employees are most likely to be absent.


“Around this time of year, many employees are either stressed out by the rush and pressure to wrap up the year, or are simply already in ‘holiday mode’, and both of these factors can have an impact on the number of absent employees. This type of festive season absenteeism can affect smaller businesses that require all hands on deck in order to meet final targets and deadlines,” says Botes.


He says that although this time of year, in particular, is notorious for absenteeism, certain businesses, such as those operating in construction and manufacturing, often experience a ‘quiet period’ during December and early January and can therefore grant the most annual leave, or close a business for a few weeks. “Depending on the sector, this approach should be encouraged among business owners as resource requirements during this period are often lower and it also enables staff to return to work in the New Year recharged and refreshed.”


However, when it comes to planning for a new year, business owners need to be consciously aware of the real cost of absenteeism on their business.


“Costs associated with absenteeism not only include the employee’s actual salary cost of sick leave, but may also result in the company having to source alternative labour resources given the particular industry they operate in. Other staff members could also become despondent, which could result in a decline in morale if they witness on-going absenteeism. These factors can collectively lead to a decrease in the company’s productivity, and ultimately profits, especially for smaller businesses.”


He says that while absenteeism is often due to legitimate reasons, it can sometimes get out of control if the situation is not managed effectively. “Occasional employee absences are inevitable, such as employees getting sick or having to handle personal emergencies, but habitual absences are the most challenging as these have a profound financial effect. The most efficient way for business owners to handle absenteeism in the workplace is by developing, implementing and enforcing strict guidelines.


“It is also the right of the employer to request a doctor’s certificate should the cases become habitual.  Regular absenteeism on a Friday and Monday should be addressed in a constructive way by management.”


Botes adds that given the nature of SMEs, sometimes a more direct and robust approach may be more suitable. “Flexibility has been proven to reduce absenteeism and as SMEs often consist of fewer employees than larger corporates, business owners can opt to implement flexible structures, such as allowing employees to select and swap shifts at short notice, which can assist with minimising habitual absenteeism,” concludes Botes.

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