With the change of the economic model in Eastern Europe at the beginning of the 1990s, numerous problems related to the (non) competitiveness of the Croatian economy in relation to the countries from the immediate or distant environment came to the fore. Reduced competitiveness is most often the result of several different phenomena such as outdated technology or high cost of capital (due to business risk), but non-competitiveness is mostly associated with the emergence of low productivity.

Namely, low labor productivity results in an unrealistically high total labor cost in relation to the realized value, which then significantly increases the price of the final product or service.

What is causing the low labor productivity that investors and entrepreneurs often blame on the Croatian economy?

As with all key economic problems, there are a number of causes, ranging from lack of quality workforce or its unfavorable age and educational structure through outdated models of organization and management of business processes unsuited to new generations of workers to high rates of temporary absences from work. we colloquially call it “absenteeism.”

This phenomenon is one of the key factors of labor productivity and generates a large part of the so-called “hidden” labor costs. A large number of employers are not even aware of the impact that absenteeism has on their business.

According to current research in the world, 38.3% of the gross salary is paid for work that is never done (Total Financial Impact of Employee Absences, p. 19 (Report by the Society for Human Resource Management & Kronos Workforce Institute, 2014)), ie the average employer in Croatia has 51.3 paid and unworked working days per year for each of its employees.

In addition to direct and indirect costs, absenteeism in the organization results in a whole range of negative phenomena such as employee overload, management frustration and ultimately the collapse of organizational culture and the acquisition of the label of social irresponsibility.

What exactly is absenteeism?

The word absenteeism comes from the Latin word “absens” (gen. Absentis) which means absent. According to the generally accepted definition, absenteeism in labor economics means a one-time or multiple temporary absences of workers from the work process. The absence of workers can have different durations and be caused by a whole range of different, both internal and external factors.

From the aspect of costs and possibilities of organizing business processes, absenteeism is divided into two different forms – planned and unplanned. Although it sounds paradoxical, there are a number of different absences of workers from the work process that the employer plans and for which he determines the budget in advance.

Planned absenteeism

These planned absences include annual leave (individual and collective), employee trips to training or preventive medical examinations, as well as absences due to planned, previously approved days off (usually in cycles, for example during field or shift work).

Although the causes of planned absences are more or less transparent, and their costs are predictable and limited, they still need to be managed, primarily to avoid the synergy of planned and unplanned absences of workers.

Namely, if workers are prevented from using an annual leave in the period in which they planned it (either due to previously paid trips, the fact that their partner is using annual leave at that time, etc.), they will very likely resort to some other form of absenteeism, most often abusing temporary incapacity for work. The situation is the same with the popular “merger” of holidays, which most often occurs in June, due to the fact that the legislator allowed the transfer of unused annual leave to the new calendar year, provided that it is used by the end of June at the latest.

If workers are prevented from taking annual leave during the period in which they planned it, they are very likely to resort to some other form of absenteeism.

In addition to annual leave, other forms of planned absenteeism are: public holidays and celebrations, education of workers, mandatory medical examinations and the like. In short, planned absenteeism is any absence that we know in advance when it will occur, as well as the duration of it.

Unplanned absenteeism

Unlike planned absences, in case of unplanned absences, the employer is in a much bigger problem from the aspect of the organization of business processes. An unplanned absence is any absence for which it is not known when it will occur, it is usually not known how long it will last, there are no planned replacements or budget.

Unplanned absenteeism primarily includes illness, ie absences caused by deteriorating health. In addition to sick leave, unplanned absences include cases when the employee is absent due to some unforeseen circumstances, and in accordance with legal provisions or the provisions of the collective agreement (death in the family, illness of family members, marriage, relocation, etc.).

This group also includes cases of so-called micro-absenteeism, ie absences shorter than one day, such as delays at work, frequent breaks (cigarettes or coffee) longer than the prescribed duration and leaving the company to do private things (procurement of supplies, obtaining documents, etc.).

Do you want to get an insight into the real reasons for the absence of your employees? See how Improv3 can help you with that.

Causes of absenteeism

Outside the division by duration, absences can also be divided by causative agent. Thus, we recognize absenteeism due to cultural and behavioral causes, of which the so-called “Capricious” absences (conflict of workers with superiors or poor motivation to work due to eg dissatisfaction with salary or promotion), absences due to personal needs or jobs (documents or fieldwork…) or absences due to social problems (alcoholism, domestic violence, etc.).

The frequency of absenteeism in such cases depends almost exclusively on the employee (attitude towards work, management, shifts, etc.) and the workplace (the type of work the employee does, the quality of the organization…), and is easily linked to the employee’s intention to force the employer to change his role.

When we talk about “capricious” absenteeism, special attention should be paid to the frequent openings of sick leave in cases where organizational changes occur. When organizational changes occur in which certain organizational units are deleted or separated from previous organizations, many workers, out of their own insecurity, or ignorance of their fate in the process, “flee” on sick leave, to their home comfort zone, in order to avoid embarrassing situations for yourself.

Therefore, it is important that when entering organizational changes, we communicate them very clearly and very precisely with all employees to whom they apply, in order to avoid additional costs and disruption of organizational culture.

Apparent presence denotes a situation in which workers are present in the workplace but do not participate in the business process (do not work), either because they cannot (e.g. are ill) or because they do not want to work (they are not motivated).

Absenteeism is closely related to the two phenomena that often precede or follow it. It is about the appearance of the so-called apparent presence or turnover. While the notion of turnover (permanent departure of workers) is widely known to almost all participants in business processes, apparent presence is something that is very difficult to identify and about which very little is known, and can have far-reaching consequences for the organization.

Namely, apparent presence denotes a situation in which workers are present at the workplace but do not participate in the business process (do not work), either because they cannot (eg are ill) or because they do not want to work (they are not motivated). Occurs when a reward model or organizational culture stimulates workers to come to work despite temporarily reduced work ability (e.g., rewarding workers who have not been absent in a given period) or when a worker is not motivated to work (conflict with a supervisor or job dissatisfaction).

Levels of absenteeism

As stated, absenteeism and the phenomena that accompany it can have an extremely negative impact on the organization and its functioning. Therefore, it is very important to know the causes of the frequent absence of workers from the work process.

There are 3 levels at which absenteeism develops:

Macro level

• It includes all those causes that we can in no way or almost in no way influence, but which we must be very aware of when we want to manage absenteeism. The causes of the macro level include, for example: the state of the health system, the socio-economic framework, the emergence of epidemics, legislation, etc.

Individual level

• It implies those characteristics of each individual worker that can influence the greater or lesser occurrence of absenteeism. These include, for example: age, gender, health status, family environment, etc. When we mention the individual level, it is especially important to pay attention to generational differences and what each new generation brings us as a challenge. Namely, different generations have different needs and different patterns of behavior, and thus different motives for absenteeism and apparent presence (individuality, flexibility or disagreement with organizational principles).

Organisational level

• It includes all those factors within the organization that can more or less influence workers to be absent from the work process. The causes of the organizational level include, for example: organizational culture, leadership, line management, selection process, procedures, etc. It is precisely the causes at this level that employers most often do not recognize but attribute absences to “negligence” of workers. damage to the organization.

Why is it important to know to which level a particular cause of absenteeism belongs? A simple insight into the characteristics of the causative agent at each of the described levels makes it clear that significant progress in a relatively short time is easiest to make at the organizational level.

If we want to change the macro level, we should be able to influence the state, ie the health and social system (for example, to implement health reform), which would take years. On the other hand, changes at the individual level of workers would last even longer as they imply a change in the model of behavior or the development of awareness of the working population, which is an infinitely different process. It is therefore easy to conclude that it is very pragmatic to first try to eliminate the organizational causes of absenteeism.

Damir Kovačević, Vice President at Absence Insight

Do you want to get an insight into the real reasons for the absence of your employees? See how Improv3 can help you with that.