As a fresh-faced college graduate interviewing for my first grown-up job, I had no concept or understanding of the intricate world of absence management. Sitting across the table from a panel of interviewers, I listened to words like FMLA, CFRA, employer-sponsored plans, STD, LTD … and kept an internal checklist of all the words I’d have to look up on my friendly internet browser.
The real challenge occurred when I was offered a job as case manager for a company administering leaves and disability benefits. Navigating training meant learning a slew of new words, acronyms, and processes. It felt completely overwhelming.
Whether you’re an employee interested in learning the basics of absence administration, or someone seeking a career in the field, I’d like to introduce you to the basic concepts of absence management.
What is Absence Management?
Absence management can be best described as a combination of programs, policies and procedures that are used to manage, track, and reduce employee absenteeism. The goal of a successful absence management program is to avoid disruption within the workplace and to comply with leave laws, which have continued to expand year after year. Absence management encompasses planned and unplanned time off from work due to a variety of reasons, such as an employee’s serious health condition, injury, or illness, caring for an ill family member, bonding with a newborn child, or taking time off due to civic responsibilities, to name a few.
Why is Absence Management Important?
According to the Centers for Disease Control and Prevention (CDC), companies experience productivity losses related to personal and family health problems, which total roughly $225.8 billion annually. That translates to costs of $1,685 in expenses per employee for U.S. employers.
At the same time, the reasons for an employee’s leave often relate to stressful circumstances, so having certainty about allowed time off can provide peace of mind.
A properly managed absence program provides significant benefits to both employers and employees:
- Financial Savings – Well-defined absence programs can reduce both direct and indirect costs of employee absences. When an employee is out of work, the cost to the employer is multiplied significantly. Not only is the employer responsible for paying out potential wages such as PTO/sick time, but also there’s an impact in the loss of productivity. This means paying overtime for additional staff to cover the work, administrative costs of managing the absence, and additional costs for providing a replacement. The replacement costs can include financials tied to finding and interviewing new talent as well as investing time and effort for training.
- Compliance – Understanding and adhering to the varied federal, state, and municipal leave laws ensures that an employer will be less likely to engage in risky administrative behaviors and poorly written policies. Today’s absence management programs must consider not only sick leave policies, but also how these policies interact with the continually changing paid and unpaid leave of absence programs. Having a well-planned and documented approach to absence management can reduce the risk of lawsuits, as well as Equal Employment Opportunity Commission and U.S. Department of Labor investigations.
- Preventing Presenteeism – Presenteeism describes employees who continue to work while sick, disabled, or impaired. This type of behavior can be detrimental to an individual’s productivity and quality of work, which can result in performance management challenges for employers. Applying a well-managed absence program, giving employees time they need when it is most critical to their health, and providing flexible work arrangements such as telecommuting, reduced work schedules, or accommodations, can maximize employee productivity and decrease presenteeism in the workplace.
- Health and Wellness Program Integration – Providing fitness classes or reduced-cost gym memberships, health screenings, counseling, and ergonomic assessments for the workplace can promote employee well-being and participation in health and wellness programs that are often underutilized in this space.
Fortunately, human resources professionals don’t have to navigate these challenges alone. Absence management software can make administering leave of absence a routine, rather than a headache. For example, FINEOS Absence offers employers the ability to manage disability, leaves and company-sponsored plans on a single platform.
Contact us to discuss your needs and schedule a demo.
