How to Calculate the Absenteeism Rate

Employees may be absent from work for a variety of reasons. Throughout the year, you should anticipate your employees to be absent due to illness or other reasons. However, your company's productivity may suffer if employees begin missing work abruptly.

Before you act, discover why your workers are absent and whether their reasons are valid. It is critical to monitor the absenteeism rate to optimise your staff's productivity.

This article will guide you on the absenteeism rate, calculating it, and its optimal rate. 

Definition of Absenteeism Rate

An annual count of unexpected employee absences due to illnesses or other personal causes is known as the absenteeism rate. You can compare the absenteeism rate to that of an individual, a department, or the entire company.

The reason for the absence determines how we interpret the absenteeism rate. For example, if a parent is a sole caregiver for their child, they could call in sick. Make sure the absenteeism rate doesn't account for holidays or tardiness.

Calculating the Absenteeism Rate

You will need the employee data below to determine your company's absenteeism rate:

• The number of days an employee or team was absent.

• The dates of their absence.

• The number of workdays available in each period. 

The International Organisation for Standardisation (ISO) uses the following standard measure:

This formula will allow you to see the absenteeism rate for over a month or even a year. You can find the number of days a staff member is absent in your company's HR system.

Again, ensure that you do not include holidays or annual leave, as they do not count towards the formula. 

The annual absenteeism rate also follows a similar formula:

Here's how to calculate the number of available workdays: 

The number of days in a year - weekend days, public holidays, and annual leave = the number of available workdays

Example of an employee's absenteeism rate 

Ahmad worked full-time in Kuala Lumpur in 2021 and was absent for nine days that year. He's also entitled to 14 days of annual leave. In Kuala Lumpur, there were 243 working days in 2021. Minus Ahmad's yearly leave days, his total workdays are 229.

Ahmad's absenteeism rate would be: 

You can use this formula for teams and departments, as well.

What is a high absenteeism rate?

Do you think your company's absenteeism rate is high? First, you must look at what a standard absenteeism rate would be.

As a rule of thumb, a 1.5% absenteeism rate is excellent and healthy. It is impossible to 100% prevent illness, and it is OK to take three to four days off a year due to a bad cold or other ailments. Please note that weekend days do not count, which is average.

Most employees do not get sick, though others may take a few days off due to the flu. It does not mean there is a problem when one employee has an absenteeism rate higher than 1.5%. The flu can knock employees out for two weeks, translating to 10 days, or a 4.3% absenteeism rate.

However, the absenteeism rate can be beneficial when it includes the whole organisation. Any absenteeism rate higher than 1.5% is most likely to be caused by the following:

• Burnout or stress,

• Lack of engagement or motivation,

• Conflict with management or colleagues, and

• Any other reason other than illness.

It is also not a good sign to have an absence rate that's structurally lower than 1.5%. Unless your organisation has a perfect employee wellness programme, this low rate could mean that your employees are afraid to take an MC, so they choose to come to work anyway.

This phenomenon is called presenteeism, where staff work while sick, which leads to poor health, exhaustion, and productivity loss.

Absenteeism rate vs absence frequency

There is absence reporting frequency, also called absence frequency. The difference between the absenteeism rate and absence frequency is that the absenteeism rate shows severity, whereas the absence frequency shows the pattern of absence.

For instance, with a 4.1% absence rate, you can be ill once for ten days straight or fall sick ten times for one day each. If it's the latter, you are unlikely to be severely ill. 

You are more likely to be stressed or in physical pain, as a day off can relieve the pain sufficiently for you to return to work tomorrow. 

Similarly, imagine two departments with both high absenteeism rates. Department A has a low absence frequency, whereas Department B has a high absence frequency. It means that Department A had fewer people ill for an extended time (for instance, an employee had burnout while everybody else was OK). 

Department B had many shorter days of absence. These patterns can give more context for your employees' absence.

If you're not already tracking your absenteeism rate actively, this post has made it clear why it's so crucial to do so. Not only does it function as a health check for the entire company, but when absenteeism statistics are broken down by department or unit, it also highlights trouble areas.

Sources: BrightHR, AIHR

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