Presenteeism: The Hidden Costs of Business

(prez.un.TEE.iz.um) nbeen a part of employee/employer relations for years.
Presenteeism, a relatively unknown concept, is theWhile that may be somewhat true, the actual
complement of Absenteeism. It is defined as theassociated costs of Presenteeism are rising, usually
measure of lost productivity cost due to employeeswithout the conscious knowledge of the employer.
actually showing up for work, but not being fullyThose "hide your head in the sand" approaches to
engaged and productive mainly because of personalbusiness operation usually spell d-o-o-m. Ignorance
health and life issue distractions. Currently,concerning any threatening, growing, unrealized
Presenteeism is estimated to be up to 7 ½ timesoperational problem will indeed be costly.
more costly to employers than absenteeism. (1)Potential Solutions: Employers must begin to encourage
Statistically, Presenteeism rears its ugly head andsick or distraught workers to stay home and get
shows itself for what it really is... a costly, somewhatappropriate medical or professional attention before
unseen threat to employers. It is considered a threatreturning to work. Consider funding or partially funding
because of its stealthy nature. The term itself is new,an on-site day-care facility. There are many successful
only recently added to our language. Considering themodels to emulate. Consider expanding or modifying
following alarming statistics, your business may be inpersonal leave policies to better aid employees.
danger.o Presenteeism accounts for 61% of anExpand EAP programs to offer additional employee
employees total lost productivity and medical costs.assistance in a wide range of emotional and family
(4)o Presenteeism costs employers an estimatedissues. This also has the unseen benefit of enhancing
$2000/yr/employee. (10)o Employees working atgoodwill and demonstrating to employees that their
diminished capacity cost employers $250 Billion/yr. (8)oemployer cares about their concerns. While these
42% of employees anticipate elder care issues overactions may appear to be costly, they are actually an
the next five years. (2)o 37% of employees withinvestment in your business.
current elder care issues have lost work time perAwareness is the key, the origin, the beginning of
week, a total of (11) hours/wk spent. (2)o On average,finding solutions. Study your operations in light of the
employees spent about 8 hours over the previousprevious statistics. Take actions to prepare for these
two-weeks off work, related to giving care. Some ofinevitable situations and build their associated costs into
that was paid, such as sick leave or vacation time, andyour business model, rather than being caught by
some was unpaid. (5)o One of the most commonlysurprise at the end of the fiscal year with drastically
requested resources from EAP's are legal services toreduced profit margins without a reasonable
cover estate planning, family law, divorce, real estate,explanation. Smart business persons will become
bankruptcy and other non-workplace issues,aware of the costs of Presenteeism and take action
accounting for 60-70% of all EAP requests fromup-front to protect their business.
employees. (2)o 64% of unscheduled absences areBibliography and References:
due to family issues 22%, personal needs 18%, an
entitlement mentality 13% and stress11%. (9)o 30% of1. 1999 study by The Employers Health Coalition of
employees come to work at least 5 days when theyTampa, FL
are too distracted to be effective. 28% of workers2. Risk and Insurance, March, 2004
took time off for care giving and 25% took at least 13. Business Legal Resources, April 24, 2003
hour/day to deal with personal issues. (7)o Costs of4. New Cornell University study, published in April 2004
absenteeism have risen from $610/employee/year inof the Journal of Occupational and Environmental
2000 to an average of $789 per employee in 2002.Medicine. A study of 375,000 employees over a
(6)o Of all of the expenses related to absence,3-year period
unscheduled time off has the biggest impact on5. Recent BankOne survey of employees
productivity, profitability and morale. (9)o 49% of6. Dee W. Edington PhD, Director, Univ. of Michigan
employees lose productivity at a rate of 1 hour orHealth Mgmt Research Center
more/day due to stress, 40% lose 1-2 days/yr, 37%7. Elevated Stress Levels Lead to Presenteeism, by
lose 3-6 days/yr, and 23% lose more than 6 days/yrRichard Chaifetz, CEO of ComPsych, provider of EAP
of productivity due to stress. 44% of employees comeprograms
to work 1-4 days/yr when too stressed to be8. Bulletin to Management, 12/5/2002, BNA Professional
effective, 19% of employees come to work more thanInformation Center
6 days/yr when too stressed to be effective. (3)o9. Braun Consulting News, 2003 CCH Unscheduled
68% of employees take frequent "stress breaks" atAbsence, Business Insurance July, 2000, and the US
work to talk with others. (7)Bureau of Labor Statistics
So, what can be done? Some will argue "Do nothing"10.
and it will work itself out, after all, these issues have