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Project Report


Submitted to



In partial fulfillment of the requirements for the

Degree of
Masters of Business Administration (MBA)

Prof.Vikasdeep Singh Satnam kaur
Roll No.

University school of business of studies

Talwandi sabo

Certificate of completion

This is certified that the final project report submitted in partial fulfillment of the requirement
of the requirement for the degree of MBA from University school of business studies
affiliated to Punjabi University Patiala, research work carried out by Satnam Kaur,in 2015
under my Guidance and supervision.


It is my proud privilege to express my sincere gratitude to all those helped me directly

Or indirectly in completion of this project report.

First of all with the limitless humility, I would like to thank God for bestowing me with
Favorable circumstances and keeping me in high spirits.

A feeling of elation insist us on expressing our heartiest gratitude to our head of HR

Department Mr. Ram Kumar Vishisth to extend all facilities for carrying out the project
successfully. I would also like to think Miss. Kuljinder kaur for his guidance during the
I would like to give my special thanks Prof.Vikasdeep Singh for their enlightened and
constructive criticism during the project.
I am highly privileged to thanks the respondents for being cooperative and sparing a few
moments from their busy schedule, without whose help this project would not have been
I dedicate my deep sense gratefulness to my parents who have always been a great source
of inspiration and encouragement for me.

Satnam Kaur


I hereby certify that the work which is being presented in the project entitled Human
Resource Management in partial fulfillment for the award of degree of bachelor of business
administration Submitted in the Department of HR at Aarti international an authentic
record of my Own work carried out during a period from June 2015to July 2015 under the
supervision of Prof.Vikasdeep Singh. The matter presented in this project has not been
submitted in any other university, institute for award of any degree.

Signature of the Student

Satnam Kaur

This is to certify that the above statement made by the candidate is correct to the best of my

In todays era of cut-throat competition, Master of Business Administration (M.B.A) is sure
to have an edge over their counterparts M.B.A education brings its students in direct contact
with the real corporate world through industrial training. The M.BA program provides its
students with an in depth study of various managerial activities that are performed in any
organization. A detailed analysis of managerial activities conducted in various departments
like production, marketing, finance, human resources, export-imports, credit dept, etc. gives
the student a conceptual idea of what they are expected to manage , how to manage and how
to obtain the maximum output through minimum inputs and how to minimize the wastage of
resources. I have undergone my comprehensive training at Aarti international ltd. I feel great
pleasure to present this report work after my training at Aarti international ltd. that produced
to be golden opportunity for me by enriching my knowledge by comparing my theoretical
knowledge with the managerial skill and application.

Executive summary

Absenteeism simply means absence from work by employee. Voluntary non attendance at
work, without valid reason. Absenteeism means either habitual evasion of work or willful
absence as in a strike action. It does not include involuntary or occasional absence due to
valid causes or reason beyond ones control, such as accidents or sickness.


When I joined the training at Aarti International Ltd.I was allocated 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 organization to make arrangement to cover staffs, which are going to
be off for long periods. However, employee taking odd days off here and there is more
problematic, can have an immediate impact. In some jobs, are likely to have to cover for
those absent.

































Dr.S Renuga Devi and Mr.N Bharathi found in their study of EMPLOYEE ENGAGEMRNT
PRACTICES IN SPINNING MILLS(2009) that the remuneration package and grievances
handling are the areas which needs the attentions of the management.

level of education are unimportant in predicting employee turnover.

According to an essay on Literature review on labour turnover it is found that Apart from age
and tenure, personal characteristics of employees appear to have little relationship to turnover

Yasir Nawaz, Tanzeel Ur Rahman, Md. Naeemullah Siraji found in their study of Role of
Voluntary Employee Turnover in Textile Industry of Pakistan 2009 that in Pakistan textile
workforce are more concerned with supervisors negative behavior and less monetary

Arie C. Glebbeek & Erik H. Bax found in their study of Labor turnover and its effect on
performance that labor turnover can have negative effects on firm performance.

AHM Shamsuzzoha and Md. Rezaul Hasan Shumon concludes in their study of Employee
Turnover-a Study of its Causes and Effects to Different Industries in Bangladesh that

relationships among wages and salary structure, compensations, fringe benefits, location
advantage, job security and social & economic factors can show a new way to control
turnover for the managerial concern.

Muhammad Naeem Tariq, Prof. Dr. Muhammad Ramzan and Aisha Riaz found in their study
ORGANIZTION that turnover negatively affects the performance of the organization.

Magnus at al. (2001) resulted that the job insecurity is interrelated primarily to exit and
devotion reactions, but not to voice. In terms of exit, a striking pattern in our results concerns
the connection obtained between job insecurity and organizational turnover intention.
Although the magnitudes of effect sizes differed across countries, there was a positive
relation between job insecurity and the propensity to exit from the organization. The results
also swell previous research by indicating that job insecurity may have similar cost for union
turnover intention.

Fogarty at al. (2004) results that the employee turnover increases due to individuals in offices
were mostly at fault, making errors because they failed to follow procedures and were
ineffectually supervised the circumstances; put the employees of the organization in, such a
pressure created by poor planning and results in increase in turnover and organizational
performance decrease.

Bloom at al. (1991) concluded that the organizational analysis of turnover is due to
organizational and ecological variables like the crime rate in the area may increase nursing
turnover. The study strongly argued that the base of increase in turnover is only
environmental basis.

Beverly & Philip (2006) recognize that the extant research on employee engagement
demonstrates its relationship to outcome variables important to every organization, such as
productivity, safety, and employee retention and customer service. They further explore that
the Increases in knowledge as to how to create high performance workplaces are always
welcome by practitioners and academics. What the field does not need, however, is another
fad term. We call for continued research into employee engagement in order better to
understand and to capture its contribution to organizational and individual performance.

According to Camp (1993), the organizational commitment found to be a significant

predictor of organizationally relevant behavior, in his case, turnover. This certainly lends
support to the position of organizational commitment. Conversely, He further justify that
there was no evidence from this study of workers in one public sector agency that job
satisfaction has any effect on voluntary turnover. The correct in that even when combined
with the other relevant control variables, the explanatory power of the models containing
organizational commitment is fairly low. It should be kept in mind that organizational
commitment was typically measured months before the respondents actually quit work. Even

so, the results of this and related studies suggest that even though we have additional insight
about the theoretical relevance of organizational commitment, we still do not seem to
understand much about the processes that generate turnover.

Ologunde at al. (1999) concluded that the employee turnover in schools and universities are
due partly to the low morale of the teachers, which in turn has increased the rate of labor
turnover from the system.

Harris at al. (2002) theory asserts that high turnover lowers firms incentives to provide staff
training programs and, therefore, reduces productivity.

Michael & Steiner (1997) concluded that the annual managerial employee turnover of an
organization is 18.6 per cent for the combined sample and their costs are very high on per
employee turnover incident while conducting his research. They further reported that chain
restaurants report higher employee turnover ratio and more costly managerial employee
turnover for independents.

Research by Knapp at al. (1998) reported that the rate at which staff change jobs has posed a
serious problem for employers in the private and public sectors. Since, staff employee
turnover generally breaks the stability, consistency and continuity of work, makes long-term
planning more difficult, it leads to shortages of staff which in turn can raise the workloads of
other employees, and raises the costs of recruiting and training staff.

Guthrie (1999) reports a positive association between the use of high involvement work
practices (HIWPs) and employee retention and firm productivity. He further indicated the
disordinal interaction, also he found that employee turnover is associated with decreased
productivity when use of HIWPs is high, and increased productivity when use of HIWPs is
low. He further reports that there is insignificant relationship between efficiency of overall
organization and the individual employee as well.

Gaia Garino found in her research of The Impact of Labor Turnover that at the optimal
wage the effect of turnover on profits is negative, since, for a given turnover function, profit
maximizing firms adjust the wage to minimize the cost of labor

W. Stanley Siebert, Nikolay Zubanov, Arnaud Chevalier and Tarja Viitanen found in their
study that empirical research on the relationship between labour turnover and productivity
has been inconclusive.

JAMES G. NEAL concludes in his research of Employee Turnover and the Exit Interview
that information gathered through exit interviews or surveys is invaluable management data.
No exit interview program can proceed successfully without a clear organizational
commitment to communicate and act upon the findings.


EBERLY found in their study of Turnover and Retention Research that the theory and
research on turnover is cumulative. Over time, they have accumulated substantial evidence on
the weighted-average effect sizes for their more frequently studied predictors. One way to

increase the rigor of their research is by making point or range predictions of their better-
studied results rather than testing them again against the null hypotheses.

MINTRAC commissioned acirrt to undertake a literature review examining the causes of

high labour turnover in a range of industries in Australia and overseas. This review of
turnover literature identifies a range of factors that have been shown to be consistently linked
to turnover. These include organisational commitment, job satisfaction, alternative
opportunities and intentions to quit. Evidence on the role of pay is still somewhat
inconclusive, although keeping pay in line with market rates is certainly critical to retaining
staff. Apart from age and tenure, personal characteristics of employees appear to have little
relationship to turnover.

AMY HISSOM concludes that there are many causes pertaining to employee turnover. Most
of these can be prevented by the employer. Employers, who offer competitive salaries along
with good benefits, will most likely retain their employees. Also the opportunity for
advancement and promotions will also help. Most employees want a job that they can
eventually advance in.

Huselid (1995) finds high labour turnover negatively linked to labour productivity in his
sample of 968 U.S. firms.

Baron, Hannan and Burton (2001) find turnover to be disruptive in their

study of hi-tech start-ups in California in the early 1990s.



The textile industry (known colloquially in UK and rag trade in Australia) is a term used for
industries primarily concerned with the design or manufacture of clothing as well as the
distribution & use of textiles.

The Textile Industry occupies a vital place in the Indian economy and contributes
substantially to its exports earnings. Textiles exports represent nearly 30 per cent of the
country's total exports. It has a high weight age of over 20 per cent in the National
production. It provides direct employment to over 15 million persons in the mill, power loom
and handloom sectors. India is the worlds second largest producer of textiles after China. It is
the worlds third largest producer of cotton-after China and the USA-and the second largest
cotton consumer after China. The textile industry in India is one of the oldest manufacturing
sectors in the country and is currently its largest.

The Textile industry occupies an important place in the Economy of the country because of
its contribution to the industrial output, employment generation and foreign exchange
earnings. The textile industry encompasses a range of industrial units, which use a wide
variety of natural and synthetic fibres to produce fabrics. The textile industry can be broadly
classified into two categories, the organized mill sector and the unorganized mill sector.

Unlike other major textile-producing countries, Indias textile industry is comprised mostly of
small-scale, nonintegrated spinning, weaving, finishing, and apparel-making enterprises. This
unique industry structure is primarily a legacy of government policies that have promoted
labor-intensive, small-scale operations and discriminated against larger scale firms:


Weaving & knitting
Fabric finishing



AARTI GROUP, which has incorporated in 1977 in the name of Aarti Steels Limited & has
taken rapid strides to emerge as one of North Indias manufactures & processor of steel with
an annual turnover of US. $ 300 million & a workforce of over 2000-2500 personnel.

AARTI STEELS LIMITED is located at LUDHIANA, PUNJAB. The Company has got a
mini Steel Plant with a capacity of 1.25 lacs tones per annum.

The company is manufacturing carbon, Spring Steel and Low Alloy Steels, which are used in
Automobile Sector of Indian Economy. Wire Rods, Wires drawn and galvanized, are also its
thrust areas.

Constant upgradation of technology is always alive on the agenda of the company, most
modern Electro Magnetic Stirring facilities at stage one of modernization have been recently
installed for quality up gradation on continuous casting machine. 26 Continuous Rolling
Mill & Vacuum Degassing arrangements installed recently. Over the years Aarti group has
emerged as a thriving organization due to its ability to transform itself rapidly to meet the
challenges of highly competitive global economy and it committed to become a supplier of
choice. So, the group has turn into major expansion and a most modern technologically
efficient and eco-friendly green field integrated steel plant has been set up at Ghanti Khal,

ORISSA PROJECT- The Steels Division of the group is setting up an 886 Crore Plant in
Orissa, which symbolizes groups growth pace. The main aim of Orissa Project is to produce
value added steel for the automobile sector for Domestic and International market & to
convert value added steel in to forged and finished components for domestic and international


During 1996, company diversified into the textile by setting up 28,000 spindles at Ludhiana
in the name of AARTI INTERNATIONAL LIMITED. Starting with 28224 Spindles, the unit
has constantly increased its capacity. Today Aarti International has an installed capacity of
1,74,450 spindles including 57,000 spindles of compact yarn. This unit with its state of art
technology has emerged as a global player in the spinning industry.

Now at present, they are having 1,74,450 spindles in four units.

It is the first company in INDIA to produce compact spinning.

Right from the day one of production, the company is exporting 90% of production to the
highly quality conscious customers. Within 3-4 years Aarti International has established a
good brand name in the market. They are mainly exporting the yarn to Hong Kong, China,
South Korea , Taiwan, Bangladesh & European Markets & our product finally ends up in
various internationally accepted & well known brands like Tommy Hilfiger, Wall & Mart,
Gap, Marks & Spencer etc.



Ashok Leyland

Mahindra & Mahindra

Mahindra Sona


Punjab Tractors Limited

G.N.A. Axle

G.N.A. Durapart

Guru Nanak Entreprises

And main ancillary units of Hero Honda, Bajaj ,Honda Motors , TVs


Tata Motors

Merri Tor Corp.


Apollo Tyres

Birla Tyres

Ceat Tyres

J.K. Enterprises


MRF Tyres

Ralson Tyres



Good brand equity

Good technological base
High production capacity


Comparatively high prices.

Lesser degree of promotional activity
High labor turnover


Favorable demand condition- large, growing domestic and international market.

The govt allows 100% FDI in the textiles sector under the automatic route.


Cotton prices soar.

Growing competition from yarn producing units in unorganized sector.


To provide efficient & reliable services to the customers by adding genuine value to the
product as taking it for competitive advantage.


To be globally recognized as a supplier of choice in this highly competitive economy.


Focus on value added yarn

Improvement in capacity utilization
Focus on high value customers
Focus on improving yields

Core Values of Aarti International Ltd:

Openness and mutual trust

Learning organization
Respect for each individual
Love for product

Corporate social responsibility:

Hospital(Deepak Charitable Hospital)

Aarti cinema
Health camps in villages

Manufacturing process:

Blow room

Cotton, which is in the form of highly compressed bales, weighing approx. 170 kgs. Is passed
through the blow room having various opening and clearing machines known as beating point
to convert it in to a loose for easy subsequent processing. The process of opening also

removes impurity of cotton such as sand, seed, particles, dust, leaf matter etc. known as trash,
to a substantial extent. The process of preparing suitable packages (known as ravings) for
ultimate ring spinning is termed as spinning preparation.


From blow room, loose cotton is fed to the carding machines or cards either through a manual
system of laps or the modern automatic system of pneumatic chute feeding. In cards, the
cotton is further individualized through combing action of line wire points. The material
combing out of the card in the form of loose fibrous rope known as card silver is collected
and stored in cans.


The next stage of processing is combing. The card silver is fed to draw frames for a precomb
drawing and further to combing preparation machines such as unilap or sliver / Ribbon lap
machines to prepare cotton in a sheet from suitable for combing action. On combing

machines, Small laps of cotton are fed and short fibers are removed through combing action
to improve the spinning of cotton for producing stronger and better quality yarn. The end
product form comber is also in the form of silver which is stored in cans. In case of carded
yarns, the material is fed to draws frames straight way without combing process.


Combed sliver or card sliver, as the case may be, is passed through draw frames to improve
the uniformity of material and parallelization of fibers in the sliver. This is achieved by
feeding up to 8 slivers in a drafting system which attenuates the sliver strand by as many
times so that the weight per unit length of end product is same as that of single sliver fed to
the machine. The draw frame sliver now gets ready for roving operation.


Roving operation i.e. intermediate step between the preparatory and final yarn spinning
converts the combed uniform strand of fibers in to a thing softly twisted ( usually 10-12 times
thinner than sliver ) of fibers known as roving which is feed material for ring spinning. The
process carried on fly frames or modern day inversion i.e. speed frames is a two stage
process where by firstly the slivers are passed through a drafting system to make a thinner
strand and then twist is imparted on flyers mounted on roving bobbins.


Enter the spinning zone to make final yarn which also continuously Winds on to the spinning
tubes the feed material in the form of roving bobbins is put on the creel of ring frame which
has now a days up to 1000-1200 spinning positions known as spindles. Each spindle has its
own ring and traveler system which inserts twist in the yarn and also aids formation of yarn
on the bobbins. The roving passes through a top arm drafting system where the fibrous
strand is further thinned (up to 25-35 times depending upon desired yarn count etc.) and
individuals fibers from the nip of drafting roller.


Since the package of yarn formed on ring frames contains small quantity of yarn (usually
about 70-100 gms.) the next stage of processing called winding , converts the smaller ring
frame packages in to bigger / heavier packages about 2.5 4 kgs known as cones or cheeses.
Winding can be manual or automatic. During winding certain yarn defects such as think and
thick places are also removed. Now adays automatic cone winders have electronic yarn
cleaning devices which ensure the yarn quality with in the predetermined parameters and
splicers which give knotless yarn.

This single yarn thus produced can be doubled on either doublers or two for one twister. The
yarn package are then conditioned and subsequently packed suitable.

Organization chart

M. D.

L A.G.M.
D.G.M PRO D.G.M. A.G.M. D.G.M C.A. A.G.M .AGM.
M. . G.
T. ST.
M. D.



D.G.M D.G.M. A.G.M. D.G.M A.G.M. C.A. A.G.M .AGM.
M. . . . . G.

R T.

T. ST.


Production department
Research and development department
Maintenance and engineering department
Human Resource department
Stores and purchase department
Excise and dispatch department
Marketing department
Finance department

Production department:

Production is the functional area responsible for turning inputs into finished outputs through a
series of production processes. The Production Manager is responsible for making sure that
raw materials are provided and made into finished goods effectively. He or she must make
sure that work is carried out smoothly, and must supervise procedures for making work more
efficient and more enjoyable.

Research and Development department:

Research and development is very expensive and can be very time

consuming for many businesses to be see positive results from it, even

though this can be the case most of the time most businesses invest
greatly in research and development, some companies put millions into
their research and development departments. Some of the main reasons

They gain an advantage over rivals.

Developing new and better products for customers.
Allows them to assess how they're products are doing.
Businesses may find that there are cheaper ways in producing
Research and development also allows better products to be
produced but at the same price for making them, so meaning the
company can raise prices for that product.

Maintenance and engineering department:

The Maintenance Department consists of the following functions: 1) administration, 2)

capital projects engineering, 3) right of way services, 4) water utility services, 5) sewer utility
services, 6) solid waste services, 7) facilities services, and 8) customer field response

Human Resource department:

Some activities and roles undertaken include:

Drawing up job descriptions,

Organizing the process of recruiting and selecting new staff,
Organize training (e.g. induction training for new staff),
Arrange and conduct performance appraisal,
Planning future staffing requirements,
Handling grievances
Implementing HRM policy, e.g. equal opportunities (line managers are expected to be
aware of all legal requirements affecting HRM).

Stores & Purchase department:

Storage of each and every component, raw materials, semi finished goods, stationeries
etc. and supply of these things for meeting the needs of the people working in the
company effectively.
First In First Out method (FIFO) system is adopted for the issue of materials for which
the life time/durability of the materials is less. For nondurable commodities LIFO
system or any other method is adopted
To receive the raw materials, components, tools, equipments and other items and
account for them.
To provide adequate and proper storage and preservation to the various items.
Maintaining minimum stock levels.
To ensure good housekeeping, so that material handling, material preservation,
sticking, receipt and issues can be done adequately.
To report to purchase department regarding the shortage/requirement of any materials
for purchase,

The role of purchasing dept:

Prevent shortages.
Minimize expenses.
Pre-approve vendors.
Track orders.
Check invoices.

Marketing department:

Managing customer relations, Concentrating on customers, Researching customers habits,

Identifying customers needs, Analyzing customers reaction to advertising, Identifying
customers influential groups, Collaborating with marketplace, Specifying target audiences or
market segments, Processing orders and payments, Getting feedback from target audience,
Researching new markets, Managing vendors, Managing budget, Tracking competitors
activity, Conducting advertising campaigns, Preparing sales presentation materials, Making
marketing schedules, Measuring effectiveness of marketing promotion, Developing company
and product brand, Forecasting sales, Planning sales, Analyzing sales, Reporting sales, After
sales support, Analyzing price, Developing price strategy, Developing product and package
design, online promotion.

Finance department:

The basic function includes-

Collection of funds.
Processing of the documents and bills.
Issuing of cheques.
Checking the bank a/c balance and bank statement.
Preparation of cash flow statement.
Preparation of fund flow statement.

Facilities availed by workers in AARTI

Fixed date of payment, i.e., 7-10 of every month.
Free colony service for male workers.
Air conditioned & computerized training centre.
Free medical camps in the company premises.
Free transport facilities for female workers.
ESI medical facility.
Provident Fund facility.
20% bonus facility.
Dispensary and visit of lady health officer 3 days a week.
Gratuity of 75 days after being with the company for five years.
Rest incentive.
Canteen facility.
Production incentive.
Bank facility.
24hrs electricity and water facility in colony.
Traveling expenses facility for the workers.
Provision of loan without interest.
Casual, earning and eight gazetted leaves.
Cultural program every Wednesday and Saturday to relieve them from stress.
Continual 10yrs service provides the pension for the worker.
Advanced technology machines provided to workers.
Advance wages facility.


1) First in India to introduce Compact Spinning.

2) 20448 spindles to produce COMPACT YARN one of the largest installations of
compact yarn machinery in India.
3) One among the five companies in India to get USTERIZED quality certificate from
USTER, Switzerland.

4) Having Supima Licence & Cotton USA License from Cotton Council International.
5) Keeping regular inventory of Indian Cotton for atleast six months and imported cotton
such as US-Pima, SJV Acala, Fibermax and Egyptian Giza for atleast two months.
6) 100% online monitoring of yarn through USTER QUANTUM gauges.
7) LABONLINE (Computer aided yarn clearing) installed in all gauges Consistency in
yarn quality achieved by activation of alarms in gauges to eliminate rogue bobbins.
Also precise setting of clearing curves through CAY.
8) Online monitoring of preparatory machine using SPIDER WEB from Rieter.
9) Continuous monitoring of power consumption by ENERCON.
10) Online facility to check shipment status on our website by using login & password provided

by us to individual buyers/ agents.

11) Approved yarn supplier to all ESPRIT Vendors Worldwide.

12) Largest installation of Link coners in India.

13) Semi Automatic bobbin transportation system from Simplex to Ring frame from
ELECTROJET, Spain for improving material handling.
14) Latest polypropylene clearer from USTER to be installed in all gauges.
15) Contamination clearing system with polypropylene detection after every fine cleaner.
16) RIETER preparatory and TOYODA Ring frames with Auto doffer.



The study of absenteeism is very important for any industry. The word absenteeism means the
absence of an employee from work when he is scheduled to be present at in work place. An
employer has available of work and employee is well aware of it, and when employer has no
information in advance, that the employee will not reputed for duty for work if he has taken
leave to which he is entitled or on ground of sickness or in case of accident. Thus absence
may authorize or unauthorized willful or caused by circumstance beyond employee's control.
Absenteeism refers to unauthorized absence of the worker from his job. Absenteeism can be
defined as failure of employee to report for work when they are scheduled to work.
Employees who are away from work on recognized holidays, vacations, approved leave of
absence or leave of absence allowed for under the collection agreement provision would not
to be included.

Recent surveys indicate:-

The higher the rate of pay &the greater the length of service of the employee, the
fewer absence.
As an organization grows, there is tendency towards higher rates of absenteeism.

Women are absent more frequently than man.

Single employees are absent more frequently than married employee.

Younger employee are absent more frequently than older employees but the later are
absent for longer periods of time.

Unionized organizations have higher absenteeism rates than non- union organization.

Absenteeism is any failure to report for or remain at work as scheduled, regardless of reason.
The use of the words as scheduled is significant, for this automatically excludes vacation,
personal leave, jury-duty leave, and the like. A great deal of confusion can be avoided simply
by recognizing that if an employee is not on the job as scheduled, he or she is absent,
regardless of cause. We focus here on unscheduled absence because it tends to be the most
disruptive and costly of the situations where an employee is not at work. Scheduled or
authorized absences are more predictable. The employee is not available to perform his or her
job as expected. This often means that the work is done less efficiently by another employee

or is not done at all. This chapter describes in detail the potential costly consequences of

DEFINITION: - Absenteeism is costly to employers, negatively impacts productivity,

stresses employees who do show up to work. Absenteeism is a pattern in which an employee
is habitually absent from work. Chronic absenteeism is often an indicator of poor employee
performance, a medical condition, or psychological problems.

Absenteeism can be a violation of an employers contract and may lead to job termination.
Most employers allot a certain number of days in which an employee can be absent,
regardless of the reason.

There are so many definitions of absenteeism as there are organizations but for our purpose
we choose the definition given in the factories Act.

Absence is the failure of a worker to report for work when he is scheduled to work. A worker
is considered as scheduled to work, when the employer has work available for him and
worker is aware of it. A worker is to be treated as absent for purpose of these absenteeism
statistics, even when he does not turn for work after obtaining prior permission. Absence of a
worker on account of strike or lay-off that is voluntar

Importance of employee absenteeism:

The employee tried unsuccessfully to contact his supervisor, a result he contacted. On his
return to work, the employee failed to provide proof of his sons medical condition. Hamman
reviewed the employees attendance record and was of the opinion that it showed
unacceptably high levels of absenteeism. No disciplinary action had ever been taken against
the employee for his attendance record. The employee was found guilty and dismissed. The
arbitrator held that a sanction of dismissal was too harsh and that the employees record of
absenteeism was irrelevant, as no disciplinary action had ever been taken against him. The
review test to be applied was whether the decision to which the arbitrator came was a
decision to which no reasonable decision-maker could have come to Sidemen other
Rustenburg Platinum Mines Ltd & others 12 The court held that at the arbitration, Ham man

was to shed light on the status of any of the periods of absence on which the employer relied
for proving excessive absenteeism, and also failed to establish any basis to suggest that any of
the periods of absence were taken without permission. In contrast, the employee testified that
he had on all occasions sought permission to be absent.

.The employer argued that the arbitrator failed the Sidumo test in relation to the
appropriateness of dismissal as the sanction. According to the court, contrary to what the
employer asserted, the arbitrator took all factors into account and the award clearly recorded
that the arbitrator dealt with the evidence before her in relation to the employees prior
absenteeism. The employer also argued that the arbitrator failed to consider properly the
special final warning against the employee and the fact that it was made clear to union
members that they would be dismissed should they commit any act of misconduct during the
period for which the warning remained valid. The court held that it was clear from the
arbitration record that there Was no evidence to suggest that the employee was personally
made aware of the content of the warning and the consequences of future misconduct, that the
warning was ever put to the employee at the disciplinary enquiry, or what role it played in the
determination of dismissal as the sanction. Finally, much of the relevant background and
other averments crucial to the employers case were disclosed only in the founding affidavit
were absent from the record of the arbitration proceedings. The consequences of these
shortcomings by the employer at the arbitration hearing could not be blamed on the arbitrator.
In the result, the application was dismissed, with costs
Long hours of work
Bad Working condition
Lack of co-operation and understanding between management and workers
Problem of transport facilities
Low wages
Lack of proper medical aid and health programmers
Lack of canteen services
Rest room
Bad housing conditions
Evil of drinking
Lack of market facilities
Social or religious festivals
Harvest seasons

Education of children
Domestic problems and consequent worries

Causes of Employee Absenteeism

Finding out the causes of absenteeism of employees and why they take unplanned leaves.

What is defined as absenteeism? According to online dictionaries, it is frequent or

habitual absence from work. It occurs when an employee takes both planned and unplanned
leaves. But it is the latter that causes much problem for employers throughout the world.
Ask any employer and they will tell you that their definition of absenteeism is a decrease in
productivity. Look deeper and you will realize that this will mean that organizations will
need to incur additional costs and time to find and train replacements to perform the

absentees work. In fact, employees unplanned absenteeism is by far one of the most
problematic faced by most organizations.

Let us have a look at the causes of absenteeism to understand the root of this problem.

Cause # 1: Employees Attitude

This is probably the main cause of misused absenteeism at the workplace. An employees
work attitude will provide hints on the level of commitment he or she has towards their
work. If employees have good work attitude, they will not take leaves unless necessary and
they will plan their leaves well in advance so that proper delegation of duties can be arranged
before that. On the other hand, should the employee have poor work attitude, then chances
are they will misuse leaves entitlements and may even have other issues like discipline and

Cause # 2: Length of Employment

Surveys have shown that the longer the employee is attached to the organization, the lesser
unplanned leaves taken, though there are exceptional cases. This is most likely due to the fact
that organizations would have gotten rid of employees who indulged in absenteeism much
earlier in their career.

Cause # 3: Work Pressure

Naturally, it goes without saying that when the work pressure goes up, absenteeism rate too
will go up. Sometimes, employees in trying to avoid stressful situations e.g. difficult
meetings would coincidently report in sick or having family commitments on that day. It
is obviously an excuse to take the day off in order not to face such pressures.

Cause # 4: Relationship with Superiors

What are the working relationships like in the office? Are the heads of department putting
too much pressure on their staff or are the managers demanding beyond what was expected
from their subordinates? In recent surveys, it was a surprise that a high number of employees
cite poor relationship with superiors as the main reason why they choose to stay away from
work. Employees, especially junior positions would rather not report to work in a bid to
avoid confrontation with their demanding bosses or as an act of defiance.

Cause # 5: Job Satisfaction

Other than to earn a salary, the other pulling factor why people seek employment is because
of job satisfaction. This is also the reason why people change jobs or work environment.
Some employees prefer doing the same thing over and over again and will not seek new
responsibilities, while others find it boring to perform monotonous functions. But in both
cases, absenteeism will occur when their level of satisfaction is lower than what they would
accept in their daily work.

Effects of Employees Absenteeism

Decrease in Productivity
Financial costs
Administrative costs

1. Decrease in Productivity :
Employees may be carrying an extra workload or supporting new or replacement
Employees may be required to train and orient new or replacement works.
Staff morale and employee service may suffer.
2. Financial Costs :
Payment of overtime may result.
Cost of self- insured income protection plans must be borne plus the wage costs of
replacement employees.
Premium costs may rise for insured plans.

3. Administrative costs :

Staff time is required to secure replacement employee or to reassign the remaining

employees. Staff time is required to maintain and control absenteeism.


Cross-sectional data were collected from outpatients with RA between December 2007 and
February 2008. The control group was formed by subjects without RA matched on age and
gender. Absenteeism and presenteeism were estimated by the Quantity and Quality (QQ)
Questionnaire, Work Productivity and Activity Impairment Questionnaire General Health
V2.0 (WPAI-GH) and Health and Labor Questionnaire (HLQ) questionnaires. Differences
between groups were tested by Mann-Whitney U-test. Costs were valued by the human
capital approach.


This study indicates that the impact of presenteeism on the total productivity costs in patients
with RA is high. However, work productivity in individuals without RA was not optimal
either, which implies a risk of overestimation of cost when a normal score is not taken
account. Finally, different presenteeism instruments lead to different results.

Financial Impact of Employee Absences:

Learn what impact and costs employee absences, beyond the costs of sick and vacation
pay, are having on your bottom line.

Survey results will astound you. The total cost of employee absence averages 35% of base
payroll; this figure includes both direct costs, like employee pay, and indirect costs, like
replacement expenses and net lost productivity. Not included in the 35% are the
administrative costs related to managing employee absence.

Most department heads and managers are unaware of the true cost of absenteeism in their
organizations. See the staggering numbers on the true cost of employee absence, including:

Total costs :- All major absence categories, including direct and indirect expense as a
percentage of base payroll .

Lost productivity :-Due to absenteeism, accrued and FMLA leave, and planned and
unplanned absence; across union, hourly, exempt, and other employee types
complaints, grievances, and lawsuits experienced on average by participants.
Risk factors:- Including employee complaints, grievances, and lawsuits experienced
on average by participants.

Factors Influencing Absenteeism in a Workplace

disruptions are a
common but
manageable cause
of employee

Employee absenteeism is a major burden to a workplace and employers. When employees
miss work, they are unable to collaborate with work teams and to complete tasks and
assignments. The costs of missed work and opportunities affect a company's bottom line.
Many companies offer wellness programs to encourage good health among employees.
However, other critical factors influence absenteeism in a workplace.


Personal illness and injury are among the leading causes of workplace absenteeism. Erie
County Department of Health educator Kimberly Beers cites a Wellness Councils of America
study showing that workplace stress causes illness and injury for 36 percent of workers. This
contributes to the $300 billion spent annually on absenteeism in the United States. Many
companies offer wellness programs and health training for employees to proactively combat
the impact of illness on absenteeism. Additionally, workplaces that pose significant safety
risks for employees should make safety training and safety standards priorities to reduce the
number of injuries on the job.

Childcare Issues

Companies that employ a significant number of parents have higher risks of absenteeism
since parents have childcare responsibilities to consider. Along with personal illness, family
illness or problems are the most common causes of absenteeism, according to Bright
Horizons Family Solutions. Parents that rely on childcare providers face a burden when a
provider is sick or not in operation on a given work day. Some parents struggle to find a
backup option and must miss work. Bright Horizons notes that some employers offer a type
of subsidized backup care program for employees in a bind so they can get to work.

Work Relationships

General working conditions are a common influence on workplace absenteeism. In his article "How to Deal with Employee Absenteeism," Gary
Vikesland, a licensed psychologist with Pathways Psychological Services in Golden
Valley, Minnesota, points out that stressful relationships with co-workers are typically a
more-specific cause of absenteeism. He notes that stress occurs in horizontal
relationships with colleagues as well as in superior-subordinate relationships.
Employees may miss work to avoid dealing with fear, anger or other stresses associated
with a co-worker. Vineland adds that companies that promote an atmosphere of
acceptance and offer internal conflict resolution processes typically have less problems
with absenteeism.

Authoritarian Management Styles

Regarding the manager-employee relationship, Vikesland indicates that authoritarian

management styles influence high levels of workplace absenteeism. Managers that are
controlling, bossy, micro-managing and who do not value input from employees often cause
increased stress for their employees. Employees may feel overwhelmed by impossible goals,
rigid or poor communication, and the general burden of having little ability to make decisions
and work with autonomy. Some employees miss work just to avoid dealing with a manager.
However, actual physical and emotional illnesses can occur if the associated stress is too
high. Companies can offer management training and coaching to help prevent these issues.

Positive Influences

Not all influences on workplace absenteeism are negative. Companies

often do proactive and positive things to reduce workplace
absenteeism, thus saving themselves money. Some companies offer
incentives to employees for achieving certain health levels or
maintaining certain standards of attendance and performance.
Offering attendance incentives may have expenses, but the costs
are probably modest compared to the expense of significant missed
work days. Just tracking attendance can have positive effects on
absenteeism as employees are more aware that their presence is

7 Tips for Controlling and Preventing Employee Absenteeism

Absenteeism in the workplace is a problem all managers encounter, and although absences
are often due to legitimate reasons, they can get out of control if theyre not managed
carefully. Persistent unexcused absenteeism, particularly when it involves just a few
individuals, not only lowers productivity and increases everyone elses workload, but it can
precipitate a sour atmosphere in the workplace. Its something that needs to nipped in the

Absences occur for many reasons burnout, stress, low morale, job hunting, etc. and need
to be addressed quickly. The following tips may help:

1. Is the Absence for Genuine Reasons?

Ever wondered if there was a good reason behind that call you just got from an absent
employee excusing himself from work for the day? Often there is a genuine reason and your
gut instinct can guide you on this one. However, if you are noticing an excessive pattern and
finding it hard to take your employees word for it, then its time to take action. If an
employee is simply not bothering to show up or give you advance notice, then an intervention
is essential. Start keeping a paper trail and records of absences.

2. Give absent Employees an Opportunity to Explain Themselves

The first thing you can do is give employees an opportunity to explain themselves. When
they return to work, have a one-on-one discussion about their absence and express your
concern. This is not a disciplinary discussion, but more of a fact-finding mission. Your goal is
to understand whats happening and try to solve the issue. For example, if stress is a factor,
then you may need to discuss strategies that can help, such as shifting workloads, reducing
responsibilities, etc.

3. Put a Performance Improvement Plan in Place

If the tactic above doesnt work, then you need to put a performance review plan in place that
sets specific goals for improvement, attendance being one of them. Put the plan in writing
and clearly explain the timeframe of the plan and the consequences of not fulfilling its

4. Develop and Communicate a Clear Leave / Sick Leave Policy

A written policy wont stop absenteeism, but it will help you deal with it more effectively. It
will also demonstrate to all employees that you dont tolerate absenteeism. Use the document
to clearly explain paid and unpaid leave policies and the consequences of unexcused
absences. If you have a company newsletter or intranet, use these to promote your policy.

5. Assess your Management Style

Its hard to acknowledge, but one of the more common reasons for employee dissatisfaction
is management style. Could your style be encouraging employees to harbor grudges or lose
morale? Step back and assess what you can do differently. Is your open door policy really that
open? Do employees really feel valued? Plan on setting side more management time for your
team, discuss their professional goals, and share your vision for the continued growth of your
business and their role in it

. 6. Consider Introducing Incentive Plans

While their are no guarantees that you can control absenteeism, initiatives such as incentive
plans and programs such as flex-time, wellness programs, and project completion perks, are
proven to increase morale and productivity. They also send a clear message to your valuable
role to play in your business as a whole. employees that they have a recognized and The
following articles have tips on how to recognize, nurture, and incentivize employees:

Get More from Your Team - 5 Employee Incentive Program Ideas That
Pay Off
Recognizing Performance in a Tough Economy: How to Best Reward
Stand-Out Employees

7. Terminating Repeat Offenders

If youve exhausted all these intervention measures and arent seeing improvement, then
termination may be your only option. Follow your HR policy to the letter on this one and
refer to the law as it pertains to terminating employees, final pay checks, and more.

Role of HR in managing employee absence

1. The role of HR in managing employee absence A Visual white paper VIZUAL

Management Solutions Ltd
2. The role of HR in managing employee absence a Visual white paper The role of HR
in managing absence Approaches to absence management Almost four in ten
employers say the recession has increased their In order for employers to manage and
monitor employee absence organizations focus on reducing absence levels and costs.
The there is a need for a clear absence management system. This largest gaps and
subsequent cost saving opportunities are in the needs to enable organizations to set
out the expectations in terms areas of preventing absences and addressing the risks
before they of attendance and absenteeism and highlight the procedures that become
more costly. should be applied in dealing with both. This is where HR can provide
effective absence management and The most commonly used approach to manage
shorter term promote accountability. Providing accurate records and reports can
absences remains the return to work interview with a recorded illustrate trends and
patterns allowing proactive managers to deal 83% of companies opting for this
approach, however the use of with the early indicators of an ineffective department.
electronic trigger systems is becoming more prevalent. These systems have the
ability to record and highlight various kinds of holidays, sickness and absence.

3. The role of HR in managing employee absence a Vizual white paper Employee
wellbeing Absence management is not only important to the employer but also the
employees. Over recent years, awareness of health issues and the impact of lifestyle
choices can have on productivity has shown a rapid increase. Employers have come to
recognise the importance to business of building an actively engaged and healthy
workforce, leading to investment in the wellbeing of their employees. Through the
analysis of absenteeism employers are much more likely to spot patterns in an
individuals working life. This can then be brought to the employees attention making
it easier for issues to be discussed and hopefully resolved. This not only aids line
managers when broaching difcult situations but also makes the employee aware that
there wellbeing is important to the company and that a resolution is mutually
benecial. Counting the cost of absenteeism Based on the average days lost per
employee per year. It is important for employers to recognise if a member of their
workforce is persistently absent so that they can use the data they An organisations
attendance policy is designed to minimise the have to aid in identifying what the key-
drivers are.

4. The role of HR in managing employee absence a Vizual white paper Recording

absence data Comprehensive reporting An effective absence management system
identies and addresses A company using an absence system can input specic working
absence causes via accurate recording and this means that casual hours, breaks, lunch
periods and overtime rules making sure that absences, intermittent or patterned absences
and disability are every minute of an employees working day is accurately recorded.
managed in an integrated manner to optimise risk avoidance. When. Authorised absences
can then be seperated from the unauthorised absences. This level of functionality not only
helps employees to know exactly who should be working when, but it can also be used to
back up any absence related disciplinaries, with accurate calendars and reports at the
touch of a button. Monitoring attendance and absence of employees accurately and
Conclusion efciently can save a company time and money. This is particularly true of
large organisations where absence rates are proven to be There is no quick win solution
to managing absence, and one size higher.

The Responsibilities of the Supervisor

In addition to ensuring that work is appropriately covered during the
employees absence, there are a number of other critical actions that
supervisors need to take to manage absenteeism. They should:

ensure that all employees are fully aware of the organizations

policies and procedures for dealing with absence,
be the first point of contact when an employee phones in sick,

maintain appropriately detailed, accurate, and up-to-date absence

records for their staff, (e.g., date, nature of illness/reason for
absence, expected return to work date, doctors certification if

identify any patterns or trends of absences which cause concern,

conduct return-to-work interviews, and

Top tactics to reduce absenteeism

Workplace absenteeism is a major concern these daysand with good reason. Even casual
absenteeism costs Canadian employers billions of dollars a year. And that doesnt take into
account disability costs, lost productivity or the demoralizing impact on the workplace.

One organization thats recently tackled this challenge is Transat Tours Canada Inc. With
nearly 300 call centre employees responding to more than 1.3 million calls a year, the
companys average monthly absenteeism rate of 12% was cause for alarm.

Thats a huge number of absences for a call centre, said Suzanne Diefenbaker, Transat
Tours director, customer care centre, during a presentation at Benefits Canadas Face to
Face: Workforce Management conference on May 29 in Toronto. There was a sense of
entitlement in the workplacea feeling that it was okay to be absent because others could
look after the customers.

In 2010, Transat Tours decided to change the statistics with a plan to identify and address
absenteeism trends. We provided our team with an objective to reduce absenteeism by 2% to
3% for the same period [compared with] the previous year, Diefenbaker said, explaining that
a tracking form was created using a simple spreadsheet to show days absent and late. We
needed to acknowledge that people do get sick, but there also had to be an understanding of
how absences impact team members and clients.

A new four-stage notification process to deal with absenteeism issues was developed in
conjunction with the HR team.

The process starts with a verbal discussion initiated by the direct manager with employees
who take two to three sick days in a row or show a trend of taking certain days off (such as
Mondays). Usually, the behaviour changes after the first stage, noted Diefenbaker. But if
theres no improvement, there is another talk and an email confirming the conversation.

By the second stage, the director and HR are informed. At the third stage, the director attends
the meeting, and by stage four, HR is involved and the employee receives written notification
that he or she has not changed behaviour and further action may be required, including
suspension, if necessary.

Barely two years after Transat Tours implemented its new program, the absenteeism rate at
the companys three call centres in Montreal and Toronto dropped to 3% to 4%.

High cost

Transat Tours experience with excessive absenteeism is not uncommon. During the events
keynote session, Dianne Dyck, an occupational health and safety specialist, provided a
broader perspective on the high cost of employees being away from work.

According to 2011 data from Statistics Canada, 8.1% of full-time employees are absent for all
or part of the week for personal reasons: 5.9% due to their own illness or disability and 2.2%
due to personal or family responsibilities. On average, in 2011, full-time employees lost 3.7%
of their work time each week due to absenteeism

All of these unplanned absences cost Canadian employers about $7.4 billion a year, according
to The Conference Board of Canada. That works out to an annual cost of $572 per employee
a figure that jumps to $1,700 per employee when looking at disability on the whole, said

And while these numbers are troubling enough, Dyck added that indirect costssuch as
replacing people off work, paying for overtime, losing productivity and allowing for catch-up
time after employees return to workwould push the total cost even higher.

If you could reduce absenteeism by one day a year, you could make significant savings for
the organization of about 22.7%, she explained, noting that Canadian employers are not
good at tracking absenteeism and have little idea about the impact of presenteeism (when
employees are at work but arent really producing). Although numbers are lacking in Canada,

in the U.S., presenteeism is estimated to represent nine times the cost of absenteeism, and
Dyck expects that a similar trend will be seen here.

With studies linking high rates of absenteeism and presenteeism to low employee morale,
Dyck made a case for going beyond the traditional approach of trying to change the worker.

Im not advising that employers give up on the traditional approach, because it is effective,
she said. But an enlightened approach would give organizations more bang for their buck.

To have the most impact, she recommended that organizations build a workplace culture that
is conducive to regular work attendance and strong productivity. You need to do a cultural
assessment, then drive change to the desired state and involve the grassroots to move

Partners in time

The high cost of calling in sick is well recognized by Victor Trotman, senior director, labour
relations, with the University Health Network (UHN). He presented UHN as a case study on
reducing absenteeism through collaboration in a unionized environment.

Our organization is prone to absenteeism, he explained, noting that there are seven unions
and 20 collective agreements in place. Currently, our level of absenteeism at UHN is less
than six days per employee a year, and in our benchmarking going forward, we need to
reduce that level. And were going to do it.

But it wont happen overnight. Back in the 1980s, the hospitals absenteeism rate had jumped
to an average of 13 days per employee a year. Despite a robust attendance management
program and massive terminations for both innocent and culpable absenteeism, the rate
remained high.

The big turnaround happened when the absenteeism problem led the hospitals to consider
contracting out the nutrition department to the private sector. At that time, absenteeism was
running at eight days per employee per year.

Trotman and the leader of the union local decided to collaborate on finding a solution to keep
the work within the organization. Expanding the focus from one department to the whole
bargaining unit as a group, the union and management looked at the cost factor, injuries and
lost productivity.

In many cases, wed had to accommodate employees, and that was costing us $3 million a
year, said Trotman. We had to reduce injuries to lower that cost.

During negotiations, management proposed that if the level of absenteeism were reduced by
2.5 days per year (30%) over the next year, then employees would get a wage increase. If the
absenteeism rate didnt fall by at least 30%, theyd get nothing. The tactic worked:
absenteeism fell by 40%.

The next step was to address employees who took more than 75 hours a year off for sick
time. Ron Callanan, UHNs HR manager, suggested reclassifying them as part-time
employees, and the union agreed.

When some individuals were reclassified, it began to send a message to the employees as a
whole, Trotman remarked. The cure was fabulouspeoples absences were reduced to
such an extent that it was staggering.

Although an arbitrator later raised the standard from 75 hours to 115 hours, the focus
expanded beyond the service union when a similar agreement was negotiated with unions
representing technicians and nurses through the arbitration process.

In the end, we saw a significant decline in absenteeism and reduced costs, said Trotman.
The organization now says we need to reduce absenteeism to less than four days off [per
employee] per year. That is a virtually impossible task. But we are up to the challenge, and
today, we definitely have a more engaged workforce.

Workplace strategies

Transat Tours and UHN used different tactics to reduce absenteeism, and both saw positive
results. But every workplace is different. A panel discussion led by workplace health
specialist Karen Seward closed out the event by offering a wide spectrum of attendance
management strategies. Suggestions included everything from training managers to recognize
issues that could trigger absences, to creating a positive work environment that encourages
people to come to work, to providing early support and accommodation for people with
health issues and adopting successful back-to-work programs.

Angela Borges, manager, health and absence management, with Standard Life, explained that
she sees a lot of different types of workplace absences, including short- and long-term
disability related to chronic disease and mental illness.

From my perspective as a carrier, what influences a lot of absenteeism is poorly documented

performance management, lack of attendance management programs, poor training for
managers and poor hiring practices, she noted. Some employees come in the door having
the wrong impression of the organization, and they are not going to be engaged. So if they
dont like their job or their boss, they go on sick leave.

Noting that no one is healthy 100% of the time, Paula Allen, practice leader, health and
benefits, and vice-president, health solutions, with Morneau Shepell, said there are only three
health reasons for employees to take time off work: one, they are contagious, so having them
in the workplace is a risk to someone else; two, the environment may pose a risk or delay
their recovery; or three, they are so incapacitated that they cant do productive work.

To help reduce absenteeism, she suggested problem-solving (particularly accommodation) to

manage chronic conditions such as mental illness and creating a policy and culture that
promotes coming to work.

Sometimes, it is important for employees to know that they are expected to be at work and
why they are needed, she added.

When employees do go off work, it is best to get involved as early as possible, said Sheri
Quinn, national health and wellness specialist with Golder Associates Ltd. Then you can

direct the absence and ensure that appropriate care is involved, work with managers to see if
any type of accommodation is available and educate co-workers. The workplace environment
can sometimes become difficult if other workers resent having to pick up the slack for a
colleague who is off sick.

Everyonemanagers, unions, employees and co-workershas a role in preventing

absenteeism and managing absences to get people back to work as soon as possible,
emphasized Seward.

We need to think about absence policies, integration of programs, accommodation

and return to work as a continuum, she summarized. Its important to understand
the individual and start from the assumption that someone off sick wants to be back at


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 other, whilst
the financial consequences of the works absenteeism are for many years to the change of the

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.


Employee absenteeism creates problem with deadlines, morale, productivity and scheduling.
If your company is having a problem with absenteeism, look at the situation from a broad
perspective first, as dealing with the root causes of absenteeism is more effective than
addressing the problem on case-by case basis.

Step 1

Gather hard data relating to the absenteeism so that you know the size of the problem.
Analyze the data to determine if a small percentage of employees are contributing to the
absence rate, or if many employees are often absent. Look for a period of time when the
absences increased, as there may be a organizational change or similar factor affecting the
absentee rates.

Steps 2

Address any organizational factors that you determine might be related to the absenteeism.In
the increases in job demands are directly related to absenteeism, as are decreases in job
resources, such as feedback and learning opportunities.

Steps 3

Address personal reasons that employees may be absent.Schaufeli notes that work-home
interference and emotional pressures influence employee absenteeism. Employee might
need additional flexibility, job training or other measures to reduce feelings of being
overhelmed that can lead to absenteeism.

Steps 4

Address absenteeism on an individual basis as well. Meet with the employee and discuss
possible solutions. If a particular employee continues to have excessive absenteeism,
give him a verbal warning and document it. If the absences continue, give a written
warning that should be placed in his personnel file.

Steps 5

Develop an absenteeism policy if you dont already have one. Detail how many absences are
acceptable in a given period of time, and for what reason. Delineate consequences for
violating the policy.

Guidelines for Absenteeism 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.

Identifying Excessive Absenteeism

Attendance records should be reviewed regularly to be sure that an employee's sick-leave
days are excessive compared to other employees. If a supervisor suspects that an employee is
excessively absent, this can be confirmed through reviewing the attendance records.

If all indications show that an employee is excessively absent, the next step is to gather as
much information as possible in order to get a clearer picture of the situation. The employees'
files should be reviewed and the employees immediate supervisor should document all
available information on the particular employee's history.

Individual Communication

After all available information has been gathered, the administrator or supervisor should
individually meet with each employee whom has been identified as having higher than
average or questionable (or pattern) absences. This first meeting should be used to bring
concerns regarding attendance to the employee's attention. It is also an opportunity to discuss
with the employee, in some depth, the causes of his or her attendance problem and possible
steps he or she can take to remedy or control the absences. Listen carefully to the employee's

The tone of the meeting should not be adversarial, but a major purpose of the interview is to
let the employee know that management treats attendance as a very important component of
overall work performance. Keep your comments non-threatening and work-oriented. Stick to
the facts (i.e. patters, profiles, rates etc.). The employee should be given a copy of there
attendance report with absences highlighted for discussion.

This interview will give you the opportunity to explore in depth with the employee the
reasons for his or her absence. Gather facts - do not make any assumptions. Provide support
and counselling and offer guidance as the occasion demands to assist the employee to deal
with the specific cause of the absence.

Often, after the initial meeting employees reduce their absenteeism. The meeting shows that
you are concerned and that absenteeism is taken seriously. The employee's attendance should
be closely monitored until it has been reduced to acceptable levels. Appropriate counselling
should take place as is thought necessary. If a marked improvement has been shown,

commend the employee. The meeting should be documented and a copy placed in the
employee's file.

Proof of Illness

Sometimes it is helpful in counseling employees with excessive innocent or culpable

absenteeism to inquire or verify the nature and reasons of their absence.

The extent to which an employer may inquire into the nature of and reasons for an
employee's absence from the workplace is a delicate issue. The concepts of an employee's
privacy and an employer's need for information affecting the workplace often come into
conflict. Seldom is the conflict more difficult to resolve than where personal medical
information is involved.

Unions will often strongly object to any efforts by management to inquire more deeply into
the nature of an employee's illness. You will need to consider the restraints of any language in
collective agreements in relation to this issue.

Generally speaking, however, the following "rules of thumb" can be derived from the existing

1. There is a prevailing right to privacy on the part of an employee unless the employer
can demonstrate that its legitimate business interests necessitate some intrusion into
the employee's personal affairs.
2. When such intrusion is justified it should be strictly limited to the degree of intrusion
necessitated by the employer's interests.

3. An employee has a duty to notify his employer of an intended absence, the cause of
the absence and its expected duration. This information is required by the employer to
meet its legitimate concerns to have at its disposal facts which will enable it to
schedule work and organize its operation.

4. An absent employee has an obligation to provide his employer with information

regarding any change to his condition or circumstances relating to it which may affect
the employer's needs as described in item #3 above. As such, the interests of the

employer in having this information outweigh the individual employee's right to

5. An employer rule requiring proof for every absence is unreasonable if an absenteeism

problem does not exist.

6. A mere assertion by the person claiming to be sick is not satisfactory proof.

7. The obligation to prove sickness, where the employer requires proof, rests with the

8. An employer is entitled upon reasonable and probable grounds to refuse to accept a

physician's certificate until it contains sufficient information to satisfy the employer's
reservations. (i.e. seen by physician, some indication of return to work, etc.). Non-
production of a required medical certificate could result in loss of pay until the
certificate is produced.

9. Where a medical certificate is rejected by an employer (as in #8 above) the employer

must state the grounds for rejection and must point out to the employee what it
requires to satisfy the onus of proof.

10. An employer may require an employee to prove fitness for work where it has
reasonable grounds to do so. In a health care setting the nature of the employer's
business gives it a reasonably irresistible interest in this personal information for the
purpose of assessing fitness.

11. Where any unusual circumstances raise reasonable suspicion that an employee might
have committed an abuse of an income protection program an employer may require
an employee to explain such circumstances. For example, an employer may require
responses as to whether the illness confined an employee to his/her bed or home;
whether an employee engaged in any outside activity and the reasons for the activity.

In summary then, any intrusion into the employee's privacy must be shown to be reasonable,
based on the individual circumstances and in relation to the operation of the employer's
business. If income protection abuse is suspected the extent to which such intrusion is
"reasonable" would be far greater than in the case where it is not. If you are not clear on
whether an inquiry is legally justified it is advisable to consult your superior.

After the Initial Interview

If after the initial interview, enough time and counseling efforts, as appropriate, have passed
and the employee's absenteeism has not improved, it may be necessary to take further action.
Further action must be handled with extreme caution - a mistake in approach, timing or
severity can be crippling from both an administration and labour relation's point of view.

Determining whether counseling or disciplinary action is appropriate, depends on whether

the employee's absences are innocent or culpable. If the employee's absenteeism is made up
of both innocent and culpable absences, then each type must be dealt with as a separate issue.
In a labour relation's context innocent absenteeism and culpable absenteeism are mutually
exclusive. One in no way affects the other.

Counseling 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 counseling(s)
2. Written counseling(s)

3. Reduction(s) of hours and/or job reclassification

4. Discharge

Initial Counseling

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 Counseling

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.


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

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

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.

Factors and Disease on Worker Productivity


The costs attributed to employee health problems are usually measured by employers in terms
of direct health care costs, such as medical plan claims. Although it has been understood that
employee health problems also produce indirect costs for employers, their measurement has
been far less frequent. At best, studies have recorded one component of indirect health costs:

the time lost to employee absenteeism and disability. The study presented here includes a
measure of the actual decrease in the productivity of employees while they are on the job, in
addition to measures of absenteeism and disability. These three measurements were combined
to produce a Worker Productivity Index (WPI). The WPIs of 564 telephone customer-service
agents were correlated with the employees' number and type of health risks, as measured by a
Health Risk Appraisal. Additionally, the WPI was also examined across different disease
states in the same population of employees. As the number of health risks increased, an
employee's productivity decreased. The nature of the health risk may also differentially affect
the pattern of the decrease. Finally, disease states were also associated with different patterns
of productivity reduction.

Workplace absenteeism is a phenomenon that occurs any time an employee fails to appear at
his or her job when scheduled to do so. It is possible for absences to be arranged for ahead of
time, such as for vacations or medical leave, though unscheduled absenteeism also occurs.
Significant levels of absenteeism can be very costly to a business due to losses in productivity
and the need to pay overtime to other employees that have to fill in for the absent ones, so
each company tends to deal with the matter differently. Many businesses develop some sort
of absenteeism policy that spells out the number of days an employee can be absent and any
penalties for abuse of the system.

The two primary types of workplace absenteeism are scheduled and unscheduled. Scheduled
absenteeism refers to events that are planned well in advance, such as vacations, so the
employer is able to make allowances for the absence. Some companies offer a specific
amount of either paid or unpaid vacation time each year that can be used for these types of
absences. In some cases employees are able to keep unused vacation days for the next year,
though other companies reset the allotted time each year to prevent excessive workplace

Unscheduled workplace absenteeism is caused by events that cannot be planned out in

advance. These absences are often caused by sudden medical or family emergencies,
transportation breakdowns, or other unforeseen circumstances. Workplace policies differ in
regards to unscheduled absenteeism, and employees may or may not be paid for this type of
time off. Some employers offer a number of either paid or unpaid personal days that can be
used to excuse these types of absences. In other cases, both vacation and personal days are
combined into one pool that can be drawn on for either scheduled or unscheduled absences.

In addition to individual company policies, many governments also have laws that dictate
how employers can treat employees in regards to workplace absenteeism. Each company
tends to set up a framework that will minimize the financial costs of absenteeism, though
those guidelines must conform to the local labor laws. In the United States, various laws such
as Title VII of the Civil Rights Act of 1964 (Title VII) and the Family and Medical Leave Act
(FMLA) restrict the way that employers can deal with absent employees under specific
circumstances. Other laws guarantee employees the right to scheduled absences for religious

observances and jury duty, which are other factors that can lead to workplace absenteeism .


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 works 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.

Limitation of the Study

The personal biases of the respondents might have entered into their response.

Time allowed for the survey was less.

Some of the respondents give no answer to the questions which may affect the

Generally the respondents were busy in their work and were not interested in
responding rightly.

Respondents were reluctant to disclose complete and correct information.


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, employee & 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 Hindustan
Computers Ltd.

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 interview 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

Chapter -5

Q.1 Number of years in the service.

Sr.No. No.of Respondents Percentage%

1 0-1 yr 6 60%
2 1-2 yr 4 40%
3 <5 yr 0 0%
4 2-5 yr 0 0%
5 Total 10 100%

Interpretation:- The above figure show that 60% labour working with international ltd.
employee are satisfied,40% due to low &0% employee are dissatisfied.

Q.2Number of members in your family.

Sr.No. No.of Respondents Percentage%

1 <3 2 20%
2 4 6 60%
3 5 2 20%
4 Above 5 0 0%
5 Total 100 100%


Interpretation:- The above figure shows that 20% employee not

absenteeism,60% employee once absent & 20% employee twice absent and
0% employee are not absent more than twice.

Q.3Monthly household income in Indian rupees.

Sr.No. No.of Respondents Percentage%

1 Less than 10000 100 100%
2 10001-25000 0 0%
3 25001-35000 0 0%
4 35001-45000 0 0%
5 More than 45000 0%

Interpretation:-The figure show that 100% absent due to the reason of health
problem &domestic reason& not any other reason.

Q.4 Does your job match your qualification?

Sr.No. No.of Respondents Percentage%

1 Yes 2 20%
2 No 5 50%
3 Total 100 100%

Interpretation :- The figure show that 20% employee are more satisfied with
the present absenteeism policy of HCL CDC and 50% satisfied and 30% are
less satisfied with present absenteeism policy of HCL CDC and 0% employee
who dont know about policy.

Q5. Are you clear about your work and job respondents?

Sr.No. No.of Respondents Percentage%

1 Well clear 6 60%
2 Good 3 30%
3 Total 100 10%

Interpretation :- The figure show that 60% employees are well cleared about their work and
30% are good and 10% are fairly clear and 0% not clear about their work and job

Q6. Which shift do you find more difficult to work?

Sr.No. No.of Respondents Percentage%

1 General shift 3 30%
2 First shift 6 60%
3 Second shift 1 10%
4 Third shift 0 0%
5 Total 10 100%

Interpretation :- The figure show that 30% employee are working environment are excellent
& 60% employee good work place in Aarti international LTD.&10% Fair to the employee .

Q7. Is it possible for you to get leave whenever you require?

Sr.No. No.of Respondents Percentage%

1 Always 4 40%

2 Often 5 50%

3 Sometime 1 10%
4 Never 0 0%
5 Total 10 100%

Interpretation :- The figure show that 40% excellent relation co-workers & superiors &50%
good relation in employee & superiors to the HCL CDC &10% co-worker in fair to the

Q8. Your superiors behavior towards your problem?

Sr.No. No.of Respondents Percentage%

1 Excellent 2 20%
2 Good 4 40%
3 Fair 4 40%
4 Dont Know 0 0%
5 Total 10 100%

Interpretation: - The figure show that 20% employee behaviour problem to the
superior & 40 % employee good &40% fair behaviour.

Q.9 Does your company motive you?

Sr.No. No.of Respondents Percentage%

1 Excellent 4 40%
2 Good 6 60%
3 Fair 2 20%
4 Dont Know 0 0%
5 Total 10 100%

Interpretation :- The figure show that 20% excellent company motive the
employees & 60% good & 20% is fair.

Q.10 Any suggestion/ comments

It is good to work in a HCL CDC & motivated the environment in HCL

Mohali for workers & trainees.



60% employee assume that the main reason of absenteeism of low rate of wage.
40% respondents assume that absenteeism can be removed by decreasing work of

Suggestions and Recommendations

Following points can be suggested for the chronicle

Provide incentives An incentive provides an employee with a boost to their motivation and
avoids 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 employee that they must phone in as early as possible to advise why
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 It can also be used to identify and cure excessive absenteeism.

In the end of 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 firsthand practical experience.


The study of absenteeism is very important for any industry. The word absenteeism means the
absence of an employee from work when he is scheduled to be present at in work place. An
employer has available of work and employee is well aware of it, and when employer has no
information in advance, that the employee will not reputed for duty for work if he has taken
leave to which he is entitled or on ground of sickness or in case of accident. Thus absence
may authorize or unauthorized willful or caused by circumstance beyond employee's control.

Address absenteeism on an individual basis as well. Meet with the employee and discuss
possible solutions. If a particular employee continues to have excessive absenteeism,

give him a verbal warning and document it. If the absences continue, give a written
warning that should be placed in his personnel file.



Dear Respondent,

We are conducting a survey on the employee Absenteeism. Your free and frank opinion
would be very valuable in conducting the survey. Please answer the following questions with
a () in the appropriate boxes:

Gender.......................................... Age.............................

Department.......................................... Card no............................

Designation.......................... Address...............................

1. Number of years in the service.

A) 0-1 yr b) 1-2 yr

c) 2-5 yr d) < 5 yr

2. Number of members in your family.

A) <3 B) 4

C) 5 D) Above 5

3. Monthly household income in Indian rupees.

A) Less than 10000 B) 10001-25000

C) 25001-35000 D) 35001-45000

E) More than 45000

4. Does your job match your qualification?

A) Yes B) No

5. Do you have any option of job rotation?

A) Yes B) No

6. Which shift do you find more difficult to work?

A) General shift B) First shift

C) Second shift D) Third shift

7. Is it possible for you to get leave whenever you require?

A) Always B) Often

C) Sometime D) Never

8. How many time you have taken leave in last one month?

A) 1 B) 2

C) 3 D) More than 3

9. Which of the following type of leaves you avail often?

A) Medical leaves B) Causal leave

C) Privilege leaves D) Any other (Please specify)

10. The process of applying for leave through your supervisor is time consuming.

A) Strongly agree B) Agree

C) Disagree D) Strongly disagree

E) Neither agree nor disagree

11. What is the most common reason of availing leave?

A) Sickness C) lack of interest on job

B) Long working hours D) Family/ Personal reason

E) Any other (Please specify)

12. You being recognized for excelling in your job.

A) Always B) Often

C) Sometimes D) Never

13. Your co-workers help you in work related problems.

A) Always B) Often

C) Sometimes D) Never

14. How many hours on an average you work beyond working time?

A) 1 hr. B) 2 hrs.

C) 3 hrs. D) More than 3 hrs.

E) Never

15. You clear about your work/job responsibilities.

A) Very Clear B) Some-what clear

C) Very less Clear D) Not clear at all

16. You satisfied with your work\.

A) Highly satisfy B) Satisfied

C) Not satisfied D) Not satisfied at all

17. Your relationships with your superior/co-workers.

A) Excellent B) Good

C) Fair D) Poor

18. Your company makes lot of efforts to motive you for work.

A) Excellent B) good

C) Fair D) Not at all

19. Any suggestion / comments................




Books Referred
Shashi K Gupta, Joshi Rosy, Human Resource management
Ashwathappa,k,Human Resource Personal management
Research Methodology Methods and Techniques; Kothari C.R.:Willey Easter

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