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Calculate Your Organization’s Annual Absenteeism Rate to Save Money

Does your organization calculate your annual absenteeism rate? If not, it is time to start. It is the benchmark to understand the direct financial cost of sick days. The formula is very simple. Here is how the calculation works.

Annual absenteeism rate = number of absences during the calendar year divided by the number of available workdays during the year

The formula assumes that your organization keeps track of the number of sick days taken by all employees in any given calendar year on a daily, weekly, or monthly basis. This piece of information can reveal quite a bit when compared year to year. Trends including spikes during certain times of the year, departments where staff may get sick more often (and need an intervention such as promoting good hygiene practices) or rewarding employees who never take sick days with extra paid time off.

The total number of available workdays during the calendar day is determined by the number of days in the year minus weekend days, public holidays (including mandatory company days) minus voluntary days off (including vacation days). Here is an example:

Need help calculating? Click here for an Employee Absence Rate Formula and Calculator.

To calculate an individual’s absenteeism rate, divide the number of days absent by the number of total workdays. For example, a person who has been absent for 10 days out of a total of 235 workdays is absent 4.25% of the time.

Once you know your organization’s annual absenteeism rate, you can compare your performance with the industry average and, if you are part of a group or chain, to others in your cohort. It is an opportunity either to be a leader or to learn from the leaders who are successful are reducing sick days.

Reducing the number of sick days offers many benefits to your organization as well as your employees. Need help figuring out your next steps? Contact us today!

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