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A TRAINING REPORT

On

ABSENTEEISM

AT:

FEDERAL MOGUL GOETZE (INDIA) LTD, BAHADURGARH, PATIALA.

SUBMITTED TO:

RATTAN PROFESSIONAL EDUCATION

COLLEGE, SOHANA

In the partial fulfillment of the requirement for the degree of MBA

Submitted By:

KHUSHWANT SINGH

MBA 3rd. SEMESTER

ACKNOWLEDGEMENT

Concentration, dedication, hard-work & application are essential but not only the factors to
achieve the desired goal. All these are supplemented by guidance, assistance & co-operation of
people to make it success. Every complete successful assignment is the result of many hands join
together.
It is a matter of pride and privilege for me to adequately express my deep indebtedness, thanks
and guidance to my project guide Ms. Prableen Kaur ( Incharge , Training & Development) for
her valuable guidance, co-operation and constant inspiration.

I take the opportunity to express my gratitude to Mr. Sanjay who took pains to see that I get all
facilities required for my project work and enlightened me about real working of organization.

I gratefully acknowledge the overwhelming support of Mr.Sanjeev Nanda’s efforts, professional


experience proved bliss for me during this work I also acknowledge my thanks to all the other
staff members. who directly or indirectly helped me in completing this project

Lastly, how can I forget to owe my indebtedness to my parents who provided moral support as
well as adequate finances during the course of my studies.

KHUSHWANT SINGH

DECLARATION

I, Khushwant Singh hereby declare that the project entitled EMPLOYEE


ABSENTEEISM, assigned to me by FEDERAL MOGUL GOETZE (INDIA)
LTD, during my six weeks training for the partial fulfillment of M.B.A, Degree
from RATTAN PROFESSIONAL EDUCATION COLLEGE, SOHANA is the
Original work done by me and the information provided in the study is authentic
to the best of my knowledge.

This study has not been submitted to any other institution or university for the award of
any other degree.

KHUSHWANT SINGH
INTRODUCTION
To
The Company
History

1899 – 1940: Founded on Innovation


1941 – 1956: Diversifying for Success
1957 – 1974: Going Global
1975 – 2005: A Bright Future

Federal-Mogul Corporation is an innovative and diversified $6.3 billion global supplier


of quality products, trusted brands and creative solutions to the automotive, light
commercial, heavy-duty truck, off-highway, agricultural, marine, rail and industrial
markets. The 45,000 people of Federal-Mogul located in 35 countries drive excellence in
all they do.

Company’s globally networked engineering and technical centers in the


U.S., Europe and Asia enable to bring customers breakthrough in advanced
technology and innovation.

Federal Mogul is a premier supplier of products, services and solutions to original


equipment manufacturers that use quality components in their vehicles and automotive
systems, and to aftermarket customers who sell company’s world-renowned brand-name
replacement parts through repair shops and retail outlets. As partner with a global
network of suppliers whose commitment to excellence and on-time delivery is crucial to
company success.

For more than a century, Federal Mogul has developed the innovative products, which
customers need to produce the next generation of vehicles. Federal-Mogul has been
creating value through innovation and leading technology for more than 100 years.
Today, the company is a key player in the global marketplace, serving industries that
range from automotive and commercial vehicles to railroad and aerospace. Customers
know they can rely on Federal-Mogul’s quality excellence in products, trusted brands and
creative solutions.

This company started with a bold idea, with a global workforce thousands strong. The
Federal-Mogul team has celebrated countless victories and worked hard to overcome the
inevitable challenges.

The company utilizes its engineering and materials expertise, proprietary technology,
manufacturing skill, distribution flexibility and marketing power to deliver quality
products and services, and leading brands. Federal-Mogul is focused on driving global
profitable growth and creating value to satisfy customer, employee and stakeholder
expectations.

Headquartered in Southfield, Michigan, the Company, which reported sales of $6.3


billion in 2005, employs 42,000 people worldwide. Federal-Mogul was founded in
Detroit in 1899. The Company’s principal customers include many of the world’s
foremost original equipment manufacturers of automotive, light commercial, heavy-duty
truck, agricultural, marine, rail and industrial vehicles and equipment as well as the
worldwide aftermarket.

Federal-Mogul employees throughout the organization create value for their stakeholders
and continuously strive to exceed their customers’ expectations by following these core
values:

• We are a team first.


• We respect, trust and help each other.
• We act with integrity.
• We are driven to be the best in all we do.
• We create value through innovation.

• We celebrate our success.

FEDERAL MOGUL GOETZE (INDIA) LTD.


BAHADURGARH, PATIALA
(History)

Goetze (I) Ltd., Bahadurgarh, Patiala was set up in 1954 with the collaboration of M/s. Goetze
Werke, Germany which started its production of Piston Rings for automobile industry in 1957.
The plant is situated at Bahadurgarh, about 10 kms. from Patiala on the Patiala-Rajpura Road.

Considering the need of complete Piston assembly, Escorts Ltd. ventured into manufacturing of
Pistons in 1958 with the collaboration of M/s. Mahle GmbH, Germany, which delivered the
Indian automobile industry its Pistons in 1960.

Escorts entered in collaboration with M/s. SUKO GmbH, Germany for Piston Rings in 1967 and
manufacturing started in 1968. To meet the increasing demand of market, in 1977, a parallel unit
for manufacturing Pistons and Piston Pins was set up in Bangalore.

From 1 October 1996, Escorts Ltd. entered into joint venture with M/s. Mahle GmbH, Germany
with the formation of the new company Escorts Mahle Ltd. in 1998, Goetze also became a part of
Federal Mogul, a well-known group of USA. In June 2000, both Escorts Mahle Ltd. and Goetze
have become QS-9000 certified companies.

The present capacity of the plant is 285.09 lacs nos. Piston Rings and 52.68 lac nos. Pistons (on
302 working days). The total capital employed as on 31 March 2004 is 134.46 crores in Ring
Activity and Piston Activity. The workforce including managers and supervisors is 1131 nos. in
Ring Activity and 1304 in Piston Activity as on 31 March 2004. The turnover of the Patiala
Plants is 159 crores excluding Excise (combined in Ring Activity and Piston Activity) as on 31
March 2004.
BRANDS

Federal-Mogul Goetze (India) Limited

• Manufacturer of world-class pistons, piston rings, sintered parts and


cylinder liners covering a wide range of applications including two/three-
wheelers, cars, SUVs, tractors, light commercial vehicles, heavy commercial
vehicles, stationary engines and high output locomotive diesel engines.
• Widest range of piston rings and pistons varying from 30mm to 300mm
diameter.
• The most modern production facilities at Bangalore, Patiala and Bhiwadi
are certified TS 16949, ISO14001 and OHSAS 18001.
• Market leaders both in OEM and aftermarket. Exports to many countries.
• Goetze and Goetze Brico provide leading-edge technologies and
competitive solutions for original equipment manufacturers and the automotive
aftermarket.

Production Capacity: Piston rings 55 Million


Pistons 13 Million
Turnover: April 05 -March 06 INR 5124 Million
Net Profit (after tax): April 05 -March 06 INR (505) Million

MILESTONES

1954 Incorporated as a JV with Goetze Werke

1957 Ring & liner production

Patiala

1958 Piston production as escorts (Automotive Division) (Collaboration:Mahle)

Patiala

1960 Cast iron / Forged piston production started

Patiala

1968 Pins / ring carrier production started

Patiala

1977 Piston / ring production started

Bangalore
1982 Steel rings / Large bore locomotive piston

Bangalore

1985 Light alloy products

Patiala

1989 Auto thermic pistons production

Bangalore

1990 Moly coated / IKA / chrome oil rings

Patiala

1992 Large bore rings / pistons for battle tanks

Bangalore

1994 Composite pistons / new ring foundry

Bangalore

1996 Escorts (Automotive Division) hived off into joint venture with M/S Mahle, Germany

1997 Goetze TP (India) Ltd. - Manufacturer of steel rings

2001 Merger of Federal-Mogul sintered products Ltd. with Goetze (India) Ltd.

2003 Merger of Escorts pistons activities with Goetze (India) Ltd.

2004 Introduction of chrome-ceramic rings

2004 Technical collaboration for pistons with Federal-Mogul Corporation

2006 Majority stakeholding acquisition by Federal-Mogul Corporation

2006 Name changed "Goetze (India) Limited" to "Federal-Mogul Goetze (India) Limited"
Management
Board of directors Name

Chairman Mr. Charles B.Grant

Vice Chairman, Managing Director

& C.E.O. Mr. Arun Anand

Directors Mr. Rainer Juestock

Mr. Charles H. Polzin

Mr. Mukul Gupta

Mr. Vishavjeet Kanwarapal

Corporate Leaders

Executive Directors–Sales & Marketing Mr. Mohan Narayan

a) Original Equipment Sales Mr. Yogesh

b) After Market Sales Mr. Sanjeev Singh

c) Exports Mr. G.S. Arshi

Executive Directors – Manufacturing Operation Mr. Andreaf Kolf

a) Bangalore Plant Mr. K. Saravana

b) Patiala Plant Mr. Sunit Kapur

c) Bhiwadi Plant Mr. A. R. Ahuja

Financial Controller & Company Secretary Mr. Rajan Luthra

General Manager Corporate Planning Mr. Ashish Mathur


Quality Policy

FEDERAL MOGUL GOETZE (INDIA) LIMITED commits itself to leadership in national


market for all its products and ensuring total customers’ satisfaction highest in industry. It
commits to develop and build an image in the international market to achieve a sustained annual
growth in exports.

Policy
We shall continue to manufacture all our products in conformity with accepted international
norms/ standards.

We shall also continue to retain our leadership in development of products through technical
know-how from our Collaborators and in-house developments. Consistent development of human
resources through training at all levels will be our major thrust area.

MR.CHARLES B.GRANT

(Chairman & Managing Director)


Mission of the Company

“Steadily moving towards leadership with piston with vision strategy seeing it as the
best way to leaders in business”

Vision of the Company

“To be one of the worlds leading automotive solutions provider”

Share Holding Pattern:

Federal-Mogul Corporation 51.0 %


Goetze India Ltd. 24.5 %
Teikoku Piston Rings Co. Ltd., Japan 24.5 %
EXPORT DESTINATION

• Dubai

• Bangladesh

• Singapore

• Egypt

• Mauritius

• U.S.A

• Germany

• Nepal

• Sri Lanka

• Uganda
COLLABORATIONS

A. GERMANY

o Faun
o Class

B. JAPAN

o Yamaha
o Kayaka
o Mikni

C. UK

o JCB (Goetze)
o Ford

D. USA

o HUGHES

E. FRANCE

o Bosch
o Dynapal
PRODUCT RANGE

Federal Mogul Goetze (I) Limited manufactures wide range of Liners, Brackets, Shock Absorber,
Gudgeon Pins, Light Alloy casting & Sintered Products.

Piston, Piston rings, Piston Pins, Cylinder blocks, Cylinder Liners, Brackets, Shock Absorber,
Gudgeon Pins, Light Alloy casting & Sintered Products.
PISTONS
Federal-Mogul Goetze India has state-of-the-art test bed facilities, design facilities for products
and dies and tooling with CAD/PRO-E.

Production Capacity:

13 million pistons per annum

Product Range:

30 mm to 300 mm diameter

Applications

Bi-wheelers

Cars
SUVs

Tractors

Light commercial vehicles

Heavy commercial vehicles

Heavy output locomotive diesel engines

Stationary engine

Industrial

Products suitable for

4 stroke engines

2 stroke engines

Gasoline engines
Piston Rings

Goetze piston rings of OEMs and Aftermarket in India has state-of-the-art design facilities for
products, tooling with CAD/PRO-E/GLIDE SOFT and test bed facilities.

Federal-Mogul Goetze India is dedicated to developing new technologies and continuously


improving its products.

Production Capacity:

55 million rings per annum

Product Range:

30mm to 300mm diameter

Goetze manufactures a wide range of piston rings for:

Bi-wheelers

Tractors

Passenger cars & SUVs

Commercial vehicles (HCVs, MCVs & LCVs)


Locomotive engines

Stationary engines

Industrial

Tx Type Expander & Cr Plated Rails

Chrome Plated Ring

Coating On Running Surface

Chrome ceramic plated rings (CKS)

Molybdenum coated rings

Plasma filled rings


Semi-inlaid rings

Ferrox filled rings

Features

Thin rings made from SG iron

Asymmetric profile rings

Specially honed chrome rings

Lower sharp edge rings

Reverse torsion rings

Conformable chrome oil rings

Keystone

Napier

Nitriding

Drilled hole oil ring

Interrupted cut

Narrow land

I-Ring with Cr plated Periphery

Cylinder Liners

Federal-Mogul Goetze India manufactures wet and dry cylinder liners with honnong and sleeves for bi-
wheeler applications for its quality conscious customers.

Applications
Bi-wheelers

Cars

Tractors

Light commercial vehicles

Heavy commercial vehicles

Stationary engines

Production Capacity:

0.5 million liners per annum

Product Range:

50 mm to 120 mm internal diameter

Features

Thin-walled

Plateau honed

With and without flanges


Coating

Phosphating

Metal Castings
Federal-Mogul Goetze (India) Ltd. makes a wide variety of light metal castings, including cylinder blocks;
cylinder heads for single cylinder engines; and aluminum tube castings and aluminum crown handles for
motorcycles.

TIMINGS

The factory runs round the clock in three shifts, namely- Morning, Afternoon and Night.

TIMINGS SHIFTS

6.30 a.m. to 2.30 p.m. Morning Shift

2.30 p.m. to 10.30 p.m. Afternoon Shift

10.30 p.m. to 6.30 a.m. Night Shift

However the Non-production department works in a General Shift.

(From 9 a.m. to 5 p.m.).

MAJOR CUSTOMERS OF THE COMPANY


PASSENGER CARS & JEEPS

Hindustan Motors Ltd.

Premier Automobiles Ltd.

Mahindra & Mahindra Ltd.

Maruti Udyog Ltd.

Telco

BI-WHEELERS

Bajaj Auto Ltd.

Escorts Yamaha Ltd.

Kinetic Engineering Ltd.

TVS Suzuki Ltd.

Majestic Auto Ltd.

Scooters India Ltd.

Ideal Jawa (I) Ltd.

Lohia Machines Ltd.

TRACTORS

Eicher Tractors Ltd.

Mahindra & Mahindra Ltd.

Escorts Ltd. (TD)


Escorts Ltd. (Farmtrac Division)

HMT Ltd.

COMMERCIAL VEHICLES (LCV’s & MCV’s)

Telco

DEFENCE

Vehicles Factory, Jabalpur

COMPRESSORS

Telco

STATIONERY ENGINES

Kirloskar Oil Engines Ltd.


LOCATION OF DEPOTS
Market Share Of Piston Manufacturers In India

Company Name Market Share (%)

FMGI 36.5

Perfect Circle 12.0

IP Ring 16.5

Shriram Piston 22.5

SAMKRG Piston 9.0

Menon Piston 3.5


ORGANISATION
OF
FEDERAL MOGUL GOETZE (INDIA) LTD.
ORGANISATION GOALS

The company has laid down for itself goal of improving the “value” to the customers
through:

1. LEADERSHIP: To maintain leadership in following categories

Market share: to maintain its status as brand leaders in the country for Piston and
Piston Pins.

Product Development: To develop Piston and Piston Pins for all new applications
as identified.

Technology: modernization and up gradation of technology to the latest


improvements to meet customer requirements.

2. CUSTOMER SATISFACTION:

It shall strive to achieve customer satisfaction rating more than 90%.

3. TECHNICAL REQUIREMENT:

Products are manufactured as per specifications based on DIN / JIS / IS / MAHLE


NORMS / SUKO NORMS as also against customers specific requirements.

4. QUALITY:

To improve quality consistently through quality assurance and process control.

5. DELIVERY:

To strive to achieve 100% on time delivery as per customer requirements

6. ENVIRONMENT AND SAFETY :

FMGI is fully aware of its environment and social responsibilities. To keep the
environment healthy, several measures like smoke precipitators, effluent
treatment plant, plantation programs etc. have been adopted. Pollution control
methods adopted by the company have been approved by the Central Govt.
Periodic checks and regular training is conducted to ensure safety.

7. MEDICAL FACILITIES :

Company takes a lot of interest in the extra curricular activities like medical
programs and rural development programs etc. The company has its own medical
centre as well as a heart institute and research centre, where employees get
treatment on reimbursement basis.
ORGANISATION SET UP

The organizational set up of the following departments is studied in detail:

1. HR Department
2. Finance Department
3. Purchase and Store Department
4. Production Department

HR DEPARTMENT

HR department advises the management on all matters relating to HR administration. The


top management takes into account its advice before arriving at final decisions on human
resources and administrative matters. HR Policies in FEDERAL MOGUL GOETZE
(INDIA) LIMITED have been divided into three parts:

a) HR FUNCTIONS to encourage the adoption and utilization of


latest methods and techniques in areas of manpower planning
and development and keeping avenues of promotion open to
employees.
b) PROVISION OF COMMUNICATION, TRAINING AND WELFARE
MEASURES, EMPLOYEE COMMUNICATION so that employees
contributes their best to company’s objectives and also get opportunities
for advancement and self-development.

c) INDUSTRIAL RELATIONS between employer and employee so as to


promote satisfactory relations by providing channels for upward and
downward communication and establishing systematic procedure for
redress.
FINANCE DEPARTMENT

The realization of cash for the purpose of raw materials components and
spares to pay wages and salaries to incur day to day expenses and overhead
costs, to meet selling costs to provide credit facilities to customers and to
maintain inventories is also the function of this department.

The formulation of policies with regard to profitability risk and liquidity, decisions about
comparison and level of current assets and liabilities, formulation of production policy to
keep the production steady by accumulating inventories, formulation and execution of
credit policy is also the function of Finance Department.

This Department is responsible for handling transaction relating to purchase of raw


material as well as accounts relating to sales. It is also concerned with payment of all
expenses incurred by the company like purchase of raw material, electricity bills, repairs
etc. It is also concerned with valuation of various costs relating to inventories.

It deals with determination of monthly wages, salaries of employees, fringe benefits of


retirement, provident funds deduction, incentives, bonus and all the rewards, which the
employees get for rendering their services to the company

PURHCASE AND STORE DEPARTMENT

Purchase and Store are two Departments, which go hand in hand. It is very essential that there
should be proper synchronization between Purchase Department and Store Department.

In GOETZE (INDIA) LIMITED, the main responsibility of Purchase Department is to receive


orders from other Departments, do the market survey, list the potential sellers and the rates,
choose the best and go ahead with purchase. The purchase order is placed only with approved
contractors. The Purchase Department scrutinize the following aspects:

a. Quality and Technical specifications


b. Delivery
c. Prices

Once the purchase order has been placed, it is sent to stores where the store gets ready to receive
the incoming material. When the material is received, a notification is sent to the Finance
Department.

Stores deal with an array of material, which can be divided into:


a. Raw materials
b. Components
c. Standard items or patent items

PRODUCTION DEPARTMENT

The Department is responsible for production of various items fixed on basis of production
budget, which includes:

a. Raw material budget


b. Labor budget
c. Plant utilization budget

GOETZE (INDIA) LIMITED turns out a wide variety of Piston Rings for Bi-Wheelers, Heavy
Light Commercial Vehicles and Motor Cars etc. The Company has maintained steady growth in
Piston Rings in view of ready acceptability of its products. Form modes production of 22517
rings in 1957 it touched a figure of 24 million in 2003-04.
INTRODUCTION TO
PROJECT
REASONS TO CHOOSE THE PROJECT

When I joined the training at FEDERAL MOGUL GOETZE (INDIA) LTD,


BAHADURGARH, PATIALA I was allotted the project of “ABSENTEEISM”.
Initially it appeared to me quite a simple project, but as I started working on it only then I
understood its real significance.

It is often easier for the organizations to make arrangement to cover staff, who are going to be off
for long periods. However, employees taking odd days off here and there are more problematic,
can have an immediate impact.

If remain unchecked, this type of absence can send out the wrong signals to colleagues who, in
some jobs, are likely to have to cover for those absent. If employers fail to take action, a ‘buggins
turn’ mentality may emerge. Frequent absence may have serious repercussions where staff are
employed in customer-facing roles or employed on production lines. The impact of absence may
be most directly felt and the need to arrange cover at short notice may be paramount.
ABSENTEEISM

An absence from the workplace refers to time a team member is not on the job during
scheduled working hours, except for a granted leave of absence or holiday time. Left
unchecked, high absenteeism can rapidly develop into serious business problems
including morale issues and high turnover.

Maybe even worse than absenteeism, it is obvious that people such as malingerers and
those unwilling to play their part in the workplace can also have a decidedly negative
impact.

Such team members need individual attention from frontline supervisors and
management.

Indeed, as prevention is better than cure, where such a problem occurs, it is always
important to review recruitment procedures to identify how such individuals came to be
employed in the first place.

For any business owner or manager, to cure excessive absenteeism, it is essential to find
and then eliminate the causes of discontent among team members.

If they find their supervisor or job unpleasant - really unpleasant - they look for
legitimate excuses to stay home and find them with things such as upset stomachs or
splitting headaches.

Any effective absentee control program has to locate the causes of discontent and modify
those causes or eliminate them entirely. In other words, if we deal with the real reasons
team members stay home it can become unnecessary for them to stay away.

Any investigation into absenteeism needs to look at the real reasons for it.

Sometimes team members call in sick when they really do not want to go to work. They
would not call you up and say, “I’m not coming in today because my supervisor abuses
me.”

Or, “I’m not coming in today because my chair is uncomfortable.” Or, “I’m not coming
in today because the bathrooms are so filthy, it makes me sick to walk into them.”

There are a few essential questions to consider at the outset if you want to make a
measurable improvement to your absenteeism figures.

Why is your present absenteeism policy ineffective?


Where and when is excessive absenteeism occurring? In many cases, under- trained
supervisors could be a contributing factor.

What are the real causes for absences?

It is commonly expected that low pay, poor benefits and high workloads will be the major
causes.

However, in numerous employee surveys absenteeism generally has been identified as a


symptom of low job satisfaction, sub-standard working conditions and consistent
negative and unfair treatment received by first-line supervisors.

How much formal training have your supervisors received on absenteeism containment
and reduction? If your answer is none or very little, maybe you have found the solution.

As with every other element within your organization, you cannot ask a person to do a
job he or she has never been trained to do.

Many human resources specialists have found that repetitive, boring jobs coupled with
uncaring supervisors and/or physically unpleasant workplaces are likely to lead workers
to make up excuses for not coming to work.

If your team members perceive that your company is indifferent to their needs, they are
less likely to be motivated, or even to clock on at all.

One way to determine the causes of absenteeism is to question your supervisors about
excessive absenteeism, including what causes it and how to reduce it.

Of course, if your supervisors have made no efforts to get to know the team members in
their respective departments, they may not be able to provide reasons.

However, just the act of questioning may get the ball rolling and signal to your
supervisors that their involvement is important.

Once a manager finds the real reasons for absenteeism there is another important step.
Through open communication, you need to change the team member’s way of reacting
and responding to discontent.

Other problems will no doubt arise in the future. If the way of responding has not been
reviewed, then the same cycle is likely to start all over again.

So often absenteeism problems can be sheeted back to the supervisor level and to
unsatisfactory working conditions. Without improvement in these areas, you can expect
your high rate of absenteeism to continue.
Causes of Absenteeism

The causes of absenteeism may include:

• serious accidents and illness


• low morale
• poor working conditions
• boredom on the job
• lack of job satisfaction
• inadequate leadership and poor supervision
• Personal problems (financial, marital, substance abuse, child care etc.)
• poor physical fitness
• transportation problems
• the existence of income protection plans (collective agreement )
• benefits which continue income during periods of illness or accident.)
• stress
• workload
• employee discontent with the work environment

Most if not all of these causes can be prevented by taking a positive approach to things.
By showing the employees that you care, you can help lower absenteeism in the work
place.
LOSS DUE TO ABSENTEEISM

Absenteeism and disability constitute the most important causes of work discontinuity. The
consequences are enormous. In addition to loss of productivity in connection with the duration of
the absence, the long-term consequences are far-reaching, both for the employer and for the
employee. The production of the employee has to be taken over by others, whilst the financial
consequences of the worker’s absenteeism are for many years to the charge of the employer.

There is an increasing need for limitation and prevention of the drop-out, and for gaining a clear
insight into and control over the financial consequences.
ABSENTEEISM RATE

Normally, the rate of absenteeism is calculated by dividing the number of working days
lost through absence in any given period by the total number of available working days in
that same period, as follows:

Absenteeism Rate = Number of lost working days due to absence /(Number of team
members) x (Number of Workdays) x 100.

For Example:

a. Average number of employees in work force 100


b. Number of available workdays during period 20
c. Total number of available workdays (a x b) 2,000
d. Total number of lost days due to absences during the period
93
e. Absenteeism percent (d [divided by] c) x 100 4.65%

Since absenteeism is a major barometer of employee morale, absenteeism above 5


percent has to be considered as very serious (across most industries 3 percent is
considered standard).
ABSENTEEISM RATE
AT
FEDERAL MOGUL

1.8

1.6

1.4

1.2

1
2007
0.8 2008
0.6

0.4

0.2

0
jan mar may july sept nov
Absenteeism- Types & Control

There are two types of absenteeism, each of which requires a different type of approach.

1. Innocent Absenteeism

Innocent absenteeism refers to employees who are absent for reasons beyond their
control; like sickness and injury. Innocent absenteeism is not culpable which means that
it is blameless. In a labour relations context this means that it cannot be remedied or
treated by disciplinary measures.

2. Culpable Absenteeism

Culpable absenteeism refers to employees who are absent without authorization for
reasons which are within their control. For instance, an employee who is on sick leave
even though he/she is not sick, and it can be proven that the employee was not sick, is
guilty of culpable absenteeism. To be culpable is to be blameworthy. In a labour relations
context this means that progressive discipline can be applied.

For the large majority of employees, absenteeism is legitimate, innocent absenteeism


which occurs infrequently. Procedures for disciplinary action apply only to culpable
absenteeism. Many organizations take the view that through the process of individual
absentee counselling and treatment, the majority of employees will overcome their
problems and return to an acceptable level of regular attendance.

Counselling Innocent Absenteeism

Innocent absenteeism is not blameworthy and therefore disciplinary action is not


justified. It is obviously unfair to punish someone for conduct which is beyond his/her
control. Absenteeism, no matter what the cause, imposes losses on the employer who is
also not at fault. The damage suffered by the employer must be weighed against the
employee's right to be sick. There is a point at which the employer's right to expect the
employee to attend regularly and fulfill the employment contract will outweigh the
employee's right to be sick. At such a point the termination of the employee may be
justified, as will be discussed.

The procedure an employer may take for innocent absenteeism is as follows:

1. Initial counselling(s)
2. Written counselling(s)
3. Reduction(s) of hours and/or job reclassification
4. Discharge
Initial Counselling

Presuming you have communicated attendance expectations generally and have already
identified an employee as a problem, you will have met with him or her as part of your
attendance program and you should now continue to monitor the effect of these efforts on
his or her attendance.

If the absences are intermittent, meet with the employee each time he/she returns to work.
If absence is prolonged, keep in touch with the employee regularly and stay updated on
the status of his/her condition. (Indicate your willingness to assist.)

You may require the employee to provide you with regular medical assessments. This
will enable you to judge whether or not there is any likelihood of the employee providing
regular attendance in future. Regular medical assessments will also give you an idea of
what steps the employee is taking to seek medical or other assistance. Formal meetings in
which verbal warnings are given should be given as appropriate and documented. If no
improvement occurs written warning may be necessary.

Written Counselling

If the absences persist, you should meet with the employee formally and provide him/her
with a letter of concern. If the absenteeism still continues to persist then the employee
should be given a second letter of concern during another formal meeting. This letter
would be stronger worded in that it would warn the employee that unless attendance
improves, termination may be necessary.

Reduction(s) of hours and or job reclassification

In between the first and second letters the employee may be given the option to reduce
his/her hours to better fit his/her personal circumstances. This option must be voluntarily
accepted by the employee and cannot be offered as an ultimatum, as a reduction in hours
is a reduction in pay and therefore can be looked upon as discipline.

If the nature of the illness or injury is such that the employee is unable to fulfill the
requirements of his/her job, but could for example benefit from modified work, counsel
the employee to bid on jobs of such type if they become available. (N.B. It is inadvisable
to "build" a job around an employee's incapacitates particularly in a unionized
environment. The onus should be on the employee to apply for an existing position
within his/her capabilities.)
Discharge
Only when all the previously noted needs and conditions have been met and everything
has been done to accommodate the employee can termination be considered. An
Arbitrator would consider the following in ruling on an innocent absenteeism dismissal
case.

1. Has the employee done everything possible to regain their health and return to
work?
2. Has the employer provided every assistance possible? (i.e. counselling, support,
time off.)
3. Has the employer informed the employee of the unworkable situation resulting
from their sickness?
4. Has the employer attempted to accommodate the employee by offering a more
suitable position (if available) or a reduction of hours?
5. Has enough time elapsed to allow for every possible chance of recovery?
6. Has the employer treated the employee prejudicially in any way?

As is evident, a great deal of time and effort must elapse before dismissal can take place.

These points would be used to substantiate or disprove the following two fold test.

1. The absences must be shown to be clearly excessive.


2. It must be proven that the employee will be unable to attend work on a regular
basis in the future.

Corrective Action for Culpable Absenteeism

As already indicated, culpable absenteeism consists of absences where it can be


demonstrated that the employee is not actually ill and is able to improve his/her
attendance.

Presuming you have communicated attendance expectations generally, have identified the
employee as a problem, have met with him/her as part of your attendance program, made
your concerns on his specific absenteeism known and have offered counselling as
appropriate, with no improvement despite your positive efforts, disciplinary procedures
may be appropriate.

The procedures for corrective/progressive discipline for culpable absenteeism are


generally the same as for other progressive discipline problems. The discipline should not
be prejudicial in any way. The general procedure is as follows: [Utilizing counselling
memorandum]
1. Initial Warning(s)
2. Written Warning(s)
3. Suspension(s)
4. Discharge

Verbal Warning

Formally meet with the employee and explain that income protection is to be used only
when an employee is legitimately ill. Advise the employee that his/her attendance record
must improve and be maintained at an improved level or further disciplinary action will
result. Offer any counselling or guidance as is appropriate. Give further verbal warnings
as required. Review the employee's income protection records at regular intervals. Where
a marked improvement has been shown, commend the employee. Where there is no
improvement a written warning should be issued.

Written Warning

Interview the employee again. Show him/her the statistics and point out that there has
been no noticeable (or sufficient) improvement. Listen to the employee to see if there is a
valid reason and offer any assistance you can. If no satisfactory explanation is given,
advise the employee that he/she will be given a written warning. Be specific in your
discussion with him/her and in the counselling memorandum as to the type of action to be
taken and when it will be taken if the record does not improve. As soon as possible after
this meeting provide the employee personally with the written warning and place a copy
of his/her file. The written warning should identify any noticeable pattern

If the amount and/or pattern continues, the next step in progressive discipline may be a
second, stronger written warning. Your decision to provide a second written warning as
an alternative to proceeding to a higher level of discipline (i.e. suspension) will depend
on a number of factors. Such factors are, the severity of the problem, the credibility of the
employee's explanations, the employee's general work performance and length of service.

Suspension (only after consultation with the appropriate superiors)


If the problem of culpable absenteeism persists, following the next interview period and
immediately following an absence, the employee should be interviewed and advised that
he/she is to be suspended. The length of the suspension will depend again on the severity
of the problem, the credibility of the employee's explanation, the employee's general
work performance and length of service. Subsequent suspensions are optional depending
on the above condition.

Dismissal (only after consultation with the appropriate superiors)


Dismissals should only be considered when all of the above conditions and procedures
have been met. The employee, upon displaying no satisfactory improvement, would be
dismissed on the grounds of his/her unwillingness to correct his/her absence record.
Guidelines For Absenteeism Control
Absenteeism is a disease that appears whenever a company fails to inoculate itself
through the use of sound management practices. To cure excessive absenteeism, one has
to know the exact causes and then examine the available, workable and proven solutions
to apply against those causes.

To embark upon a successful absenteeism reduction program, you need to make sure you have
some basic information and facts about absenteeism in your company. Consider the following
four questions, which should help you further focus your ideas and put a plan into action.

1 Why is your present absenteeism policy ineffective?

Absenteeism policies vary in effectiveness. Most ineffective policies I have reviewed


have a common denominator: They allow "excused" absences, whereas those that do
work are "no fault" policies.

2 Where and when is excessive absenteeism occurring?

Numerous studies have concluded that under trained supervisors are one of the main
causes of absenteeism. Therefore, any company experiencing absenteeism of greater than
3 percent should consider supervisors as a potential contributor to the problem.

Given that this may be the case, you first should check the percentage of employee
absenteeism by supervisor to see if it is concentrated around one or two supervisors. If it
is, you've begun to uncover the obvious--undertrained supervisors. If, however, your
research reveals that the rate of absenteeism is almost equally distributed throughout your
factory, you will need to investigate other possible causes.

3 A What are the real causes for absences?

People-oriented companies are very sensitive to employee opinions. They often engage in
formal mini-studies to solicit anonymous employee opinions on topics of mutual interest,
These confidential worker surveys commonly ask for employee opinion regarding higher-
than-normal absenteeism.

In other words, employees revealed that repetitive, boring jobs coupled with uncaring
supervisors and/or physically unpleasant workplaces led them to make up excuses for not
coming to work, such as claiming to be sick.

One way to determine the causes of absenteeism is to question your supervisors about
their employees' excessive absenteeism, including what causes it and how to reduce it.
4 How much formal training have your supervisors received on absenteeism
containment and reduction?

If you find that your supervisors hesitate to provide meaningful answers to your
questions, then you're on the right track toward a solution. Ask yourself, "How much
formal training have I given my supervisors in the areas of absenteeism reduction and
human resources skills?" If your answer is none or very little, your solution can't be far
behind. The fact of the matter is, you cannot ask a person to do a job he or she has never
been trained to do.

The Bradford Factor & Absenteeism

The Bradford Factor is a Human Resources tool used by many organisations to measure and
identify areas of absenteeism. The theory is that short, frequent and unplanned absences are more
disruptive than longer absences.

It is based on the fact that it is normally easier to make arrangements to cover for staff who are
going to be off for long periods, and which are more likely to be suffering from a genuine illness.

However, employees taking odd unplanned days off here and there actually cause more disruption
to the business. If this pattern is repeated regularly, the employee will have a high Bradford
Factor score; which may raise questions about how genuine the illness actually is.

The formula for the Bradford Factor is:

E x E x D = Bradford Factor Score

Where E is the number of episodes of absence and D is the total number of days absent in a
rolling 52 week period.

So, for employees with a total of 10 days absence in one year, the Bradford Factor score can vary
enormously, depending on the number of episodes of absence involved. For example:

One absence episode of 10 days is 10 points (i.e. 1 x 1 x 10)


Five absence episodes of two days each is 250 points (i.e. 5 x 5 x 10)
Ten absence episodes of one day each is 1,000 points (i.e. 10 x 10 x 10)
How do organisations use the Bradford Factor?

There are no set rules for using the Bradford Factor; it is down to each organisation to determine
the ways in which it uses the score.

However, used effectively, the Bradford Factor can reduce absenteeism dramatically, serving as a
deterrent and a method for tackling persistent absenteeism.

Studies have shown that by educating staff about the Bradford Factor, and then showing them
their score on a regular basis, absenteeism can be reduced by over 20%. This is largely down to
staff understanding that taking the odd day off here and there will quickly multiply their Bradford
Factor score. The Bradford Factor places a value on the absence which an employee can clearly
see. Where the absence is not absolutely necessary, this can serve to deter absenteeism.

When this is used in conjunction with a points system the Bradford Factor can be effectively
utilised to deter unnecessary absenteeism.

For example the Bradford Factor can be utilised by creating “triggers” whereby certain actions
are taken when an employee’s Bradford score reaches a certain point. For example, the UK
Prison Service has used the following triggers:

• 51 points – verbal warning.


• 201 points – written warning
• 401 points – final warning
• 601 points – dismissal

Setting these triggers is entirely dependent on the organisation using the Bradford Factor. It is
usually advisable to use the Bradford Factor as one of a number of absence policies. However,
setting these triggers and making staff aware of them, in addition to taking action, resulted in the
Prison Service reducing absenteeism by 18%.

By implementing mandatory procedures for tackling absenteeism across an organisation led by


the Bradford Factor, an organisation can remove the potential for differences across teams and
management and remove the difficulties and reluctance that line managers often face when
having to discipline a close staff member.

The Bradford Factor can provide organisations with a two pronged method for tackling absence:
proactively deterring absence in the first place and utilising a set procedure to identify and tackle
persistent absenteeism.

Implementing the Bradford Factor

Calculating the Bradford Factor for one member of staff over a given period is not a difficult
proposition. However, calculating the Bradford Factor over a rolling 52 week period, across
multiple teams and locations and considering different types of absence is a very difficult task.

As a result of the exponential nature of the formula {E x E x D}, even the slightest mistakes in
calculation can result in a wide variance of an employee’s Bradford Factor score.
For example:

For an employee who has had 10 days off in a year in total, on two separate occasions:

2 X 2 X 10 = 40 {which does not trigger a warning – fewer than 50}

However, if their absence is either not recorded correctly, or is calculated wrong by just one day:

3 X 3 X 10= 90 {which does trigger a warning – over 50}

You can see that their score is more than double, despite the small mistake. Getting the formula
the wrong way round can have even more significant results:

10 X 10 X 2 = 200 {which would trigger disciplinary proceedings – over 200}

If an organisation wants to tackle absenteeism effectively, using the Bradford Factor, including
using an employee’s Bradford Factor score in potential disciplinary proceedings, then the process
for calculating the Bradford Factor has to be full proof, consistent and equal. To achieve this, an
organisation will need to ensure:

• Absence reporting and monitoring is consistent, equal and accurate both


over time and across the whole organisation.
• The calculation of an employee’s Bradford Factor score is based on these
accurate, equal and updated absence records.
• Management and staff have access to updated Bradford Factor scores.

Without these processes in place the calculation of the Bradford Factor is extremely difficult and
time consuming. In addition to this; unequal processes for reporting and calculating the Bradford
Factor could be discriminatory; everyone’s Bradford Factor score should be subject to the same,
indisputable criteria.
SCOPE & OBJECTIVE
OF
STUDY
OBJECTIVES OF THE STUDY

The objectives of present study are as follows:

Major Objectives:

• To study the reasons of employee absenteeism.


• To put forward the suggestions and to find those areas where it can be
improved.

Minor Objectives:

• To study the problems of workers faced during the work period.


• To find out whether job satisfaction & motivation level are low. If yes,
then what are the reasons.
• To find out whether the workers feel stress during the work.
Limitations Of The Study

• The personal biases of the respondents might have entered into their response.
• Time allotted for the survey was less.
• Some of the respondents give no answer to the questions which may affect the
analysis.
• Generally the respondents were busy in their work and were not interested in
responding rightly.
• Respondents were reluctant to disclose complete and correct information.
RESEARCH METHODOLOGY

The methodology used for the collection of data has been divided into two groups:

Primary Data

This data is based upon personal discussion with managers, officers , employees &
workers working in various sections of HR Department, Piston Ring Foundry Shop and
Piston Ring Machine Shop.

Secondary Data

It is mainly based upon office records and other published documents of Goetze (India)
Ltd., Bahadurgarh, Patiala.

Sample Size : 50 Workers

Sampling Technique

In this project the primary data was collected through questionnaire method. A structured
questionnaire was administered and workers were asked to fill it. The interview method
was also considered as in it the interviewer and the interviewee can interact face to face.

Data Analysis Technique

Percentage method is used for the analysis of data and bar graphs are used to present that
data.
Questionnaire

Personal Information
Name –
Age-
Sex-
Job status-

• For how many years you are working with FMGI ?


0-1 yr
1-2 yr
2-5 yr
< 5 yr

• How often you remain absent in a month ?


Nil
Once
Twice
< Twice

• According to you what is the main reason for employees absent ?


Health problem / domestic reasons
Stress
Work dissatisfaction
Working environment

• Your views regarding the present Absenteeism Policy of FMGI ?


Excellent
Good
Fair
Don’t know

• Are you clear about your work / job responsibilities ?


Well clear
Good
Fairly clear
Don’t know

• Are you satisfied with your work ?


Well satisfied
Good
Fair
Not satisfied

• Your views regarding the working environment of FMGI & work place ?
Excellent
Good
Fair
Poor

• How are your relations with your superiors / co-workers ?

Excellent
Good
Fair
Poor
• Your superiors behaviour towards your problems ?
Excellent
Good
Fair
Poor

• Your views regarding the fascilities provided to you by FMGI ?


Excellent
Good
Fair
Poor

Any suggestions / Comments- _____________________________________


ANALYSIS
&
INTERPRETATION
Q. For how many yrs you are working with FMGI ?

Interpretation – it can be seen that 56% of the workers at FMGI are working for
more than 10 years whereas 36% are working for more than 5 yrs.
Q. How often you remain absent in a month ?

100%
90%
80%
70%
60%
50% no of absents in a
40% month
30%
20%
10%
0%
nil once twice >twice

Interpretation- it can be seen that 96% of the workers do not remain absent.
Q. According to you what is the main reasons for
employees absent ?

100%
90%
80%
70%
60%
50%
reason for being
40%
absent
30%
20%
10%
0%
stress personal
prob

Interpretation- according to 96% workers, personal problem is the reason for being
absent. 4% think that stress can also be the reason.
Q. Your views regarding present Absenteeism Policy of
FMGI ?

80%
70%
60%
50%
40% views regarding
absenteeism policy
30%
20%
10%
0%
excellent good fair poor

Interpretation- it can be seen that 76% workers rate the present absenteeism policy as
good whereas 22% rate it as excellent.
Q. Are you clear about your work / job responsibilities ?

100%
90%
80%
70%
60%
50%
40% clarity regarding work
30%
20%
10%
0%
well clear good fairly don't
clear know

Interpretation- it can be seen that 94% of the workers at FMGI are clear regarding
their work responsibilities.
Q. Are you satisfied with your work ?

90%
80%
70%
60%
50%
40% satisfaction regarding
30% work
20%
10%
0%
well fair
satisfied

Interpretation- 82% of the workers are fully satisfied with their work whereas 16%
workers think their work as good.
Q. Views regarding working environment of FMGI ?

90%
80%
70%
60%
50%
views regarding
40% working env.
30%
20%
10%
0%
excellent good fair poor

Interpretation- 82% workers feel that the working environment at FMGI is good
& 14% feel it as excellent.
Q. Your relations with your superiors ?

80%
70%
60%
50%
40% relations with
superiors
30%
20%
10%
0%
excellent good fair poor

Interpretation- 76% workers have good relations with the superiors whereas 22%
have excellent relations with the superiors.
Q. Yours superiors behaviour towards your problem ?

60%

50%

40%

30% superiors behaviour


towards your
20% problems

10%

0%
excellent good fair poor

Interpretation- 42% workers think that their superiors behaviour toward their
problems is excellent & 56% workers consider it as good.
Q. Yours views regarding fascilities provided FMGI ?

90%
80%
70%
60%
50%
fascilities provided
40% at FMGI
30%
20%
10%
0%
excellent fair

Interpretation– 86% workers consider that fascilities provided to them are good
whereas 10% consider them as excellent.
Conclusion
Findings

Almost 56% of the workers at FMGI are working for more than 10 years whereas 36%
are working for more than 5 yrs.

Almost 96% of the workers do not remain absent.

According to 96% workers, personal problem is the reason for being absent. 4% think
that stress can also be the reason.

Almost 76% workers rate the present absenteeism policy as good whereas 22% rate it as
excellent.

Almost 94% of the workers at FMGI are clear regarding their work responsibilities.

82% of the workers are fully satisfied with their work whereas 16% workers think their
work as good.

76 % workers have good relations with the superiors whereas 22% have excellent
relations with the superiors.

42% workers think that their superior’s behaviour towards their problems is excellent &
56% workers consider it as good.
Suggestions
Suggestions and Recommendations
Following points can be suggested for the chronicle absentees -

Provide Incentives- An incentive provides an employee with a boost to their motivation


and avoid unnecessary absenteeism. Incentives like two hours of bonus pay for every
month of perfect attendance can improve a lot.

Employee Assistance Program- if you confront an employee about his or her frequent
absenteeism and you find out that it is due to personal problems refer them to EAP.

Sickness Reporting – tell employees that they must phone in as early as possible to
advise why they are unable to make it to work and when they expect to return.

Return To Work Interview- when an employee returns to work then ensure that they
have a ‘return to work interview’.

Bradford factor can also be used to identify and cure excessive absenteeism.

In the end to conclude this report I would like to specify that the project allotted to me on
ABSENTEEISM was of immense help to me in understanding the working environment
of an organization, thereby providing a first hand practical experience.

In this project while identifying the reasons of absenteeism of the workers of FMGI,
Patiala I got an opportunity to interact with workers to observe their behavior and
attitude.

In the end I would once again like to thank the people of FMGI who helped me in
accomplishing this project and boosting my morale by appreciating and recognizing my
efforts.
BIBLIOGRAPHY

o www.goetzeindia.com
o www.benifits.org
o www.employer-employee.com
o www.citehr.com
o www.management-issues.com
o www.e-days.com
THANKS

TO

ALL