CorpComms Magazine

Have you ever pondered why the employees at your company turn up for work in the mornings? Is it because they relish the task that lies ahead of them, or perhaps it is because they look forward to chatting with their colleagues? Maybe their motives are even more selfish than that?

For Britain's Royal Mail, the answer to that question became a little clearer after its human resources division decided to tackle the problem of staff not turning up for their daily rounds.

Absenteeism in the group, which includes Royal Mail Letters, Parcelforce Worldwide and Post Office businesses, had got so bad that over six per cent of the workforce - about 10,000 staff - were off at any point in time. Postmen were taking an average of 12 days' sick leave every year, compared with a seven-day average across British industry.

Like many companies facing soaring absentee rates, the Royal Mail chose to throw money at the problem. But unlike other companies, that money was not spent on an off-the-shelf HR solution. Instead, the company went straight down to the garage, bought 34 Ford Focus cars and decided to hold a raffle.

Employees who had not taken a day off sick in six months were entered into a prize draw for the cars, which start in price at about £12,000, as well as several £2,000 holiday vouchers.

Predictably, given the Royal Mail's position as a government-owned company, the media had a field day over people being rewarded just to turn up and do their jobs. Even the Communication Workers Union (CWU), whose members include Royal Mail workers, branded the raffle a 'gimmick'.

'We have no problem at all with people winning cars and holiday vouchers,' explained CWU deputy general secretary Dave Ward. 'But giveaways are not the reason why attendance levels have improved and they are certainly not a substitute for continuing to invest in our members.'

But the initiative really seemed to work. Attendance went up 11 per cent, with 1,000 extra people turning up for work every day.

A London School of Economics (LSE) report out this summer suggested that between 2004 and 2007, Royal Mail reduced its absence rates for its 167,000-strong workforce from seven per cent to five per cent. About 3,600 employees who had previously been absent were back at work, saving the company £227m every year.

The study predicted that if some of the worst offending sectors for absenteeism, such as the health service and central government, adopted absence management policies like those at the postal services provider, the UK economy could save £1.45 billion a year because it would not be paying salaries for temporary workers and productivity would increase.

REWARDING BAD BEHAVIOUR

Royal Mail has now closed the car raffle scheme. However, it is not the only company to have tackled absenteeism with incentives. According to a survey by Mercer Human Resource Consulting, a quarter of companies in Europe are now using incentives to stop staff taking days off sick. The trend is far less pronounced in the UK, but other organisations, such as Greater Manchester Police which introduced cash prizes for good attendance, have used similar schemes and seen absenteeism drop.

Even the staid Department of Work and Pensions flirted with a similar idea to tackle 12 per cent absence rates, before rejecting incentives in favour of a 'more holistic approach'.

But does incentivising people against 'pulling a sickie' really work long-term, or are companies merely discriminating against people who are genuinely ill? And how are the incentives perceived both externally and internally?

Experts are divided as to whether the Royal Mail approach was a good idea. 'It's alright if you've got a lot of money,' says Paul Roberts, from employee wellbeing company IHC, and author of Absenteeism, Industry's Hidden Disease. 'At least they are doing something.'

Roberts claims dealing with staff absenteeism is trickier than people think, and that an off-the-peg solution will not work. 'There is no magic pill - it is very much an internal thing. A lot of time when people are dealing with absence they have a hunch that something is wrong, and they pick the wrong target.'

He says that a fatal mistake is to start by assuming that people are taking sick days because they are unwell. 'Illness is not the predominant cause of absenteeism,' says Roberts. 'It is about motivation to come to work.'

If that sounds harsh, the CBI, Britain's leading employers' organisation, suggests that around 12 per cent of absences are not caused by genuine illness. It also recognises that local government and other public service organisations have a particular problem.

'We really have to question if there is a medical explanation for the higher levels of long-term absence in the public sector. Low morale, poor management and a culture of absence are at least partly to blame,' says Sarah Anderson, CBI director of HR policy.

PRAISE NOT CENSURE

The CBI encourages a 'carrot and stick' approach to absenteeism but does not advocate incentives, such as raffles. It prefers offering incentives such as medical insurance, flexible working and health support, whilst also having formal absence management processes, which may include refusing to offer sick pay for the first three days of absence.

IHC's Roberts warns companies that high absence levels can damage their external reputation, because of lower levels of service. The CBI agrees. It estimates that indirect costs of absence, including problems with customer satisfaction, add up to an average £263 per employee every year.

According to the CBI, Royal Mail sits right in absenteeism's heartland. Absence rates are highest among manual staff, in larger organisations, in organisations where trade unions are recognised and in the public sector.

Major reasons for absence are musculo-skeletal disorders, such as back pain, as well as workplace stress. However, 70 per cent of employers surveyed by the CBI thought that praising staff for a job well done would have a radical impact on absenteeism by raising morale, suggesting that it is about far more than back pain.

Other important factors, employers felt, were offering development opportunities and decent internal communication. However, many traditional absentee management schemes tend to focus on stopping a worker's pay once they are off sick, and forcing them to provide certificates to prove that they are really ill.

Some employers, such as York City Council, even outsource absenteeism management to specialist companies who use nurses to answer the telephone when someone calls in sick. These nurses ask questions designed to discourage people from 'taking a sickie'.

Roberts says that HR departments need to focus their efforts elsewhere. 'You need to build a clear picture of who is absent, and why,' he explains.

John Smythe, deputy chairman of the Engage Forum, and a specialist in employee engagement, says that throwing incentives at people to stay in their job is not enough. 'It's fantastic if it works - and if you've got a blue collar workforce for whom financial reward is of the greatest interest there may be a demographic at work. However, you have to go deeper.'

Smythe believes people take sick time without needing it when they are not happy in their jobs. Companies like Royal Mail and other large businesses which rely on people doing repetitive jobs are likely to have the biggest problems with this, he says.

'Huge companies can be soulless, and people need to have wide discretion over their day. Even in a standardised working environment like a call centre, people are happier if they have control over the language they use. Put people in a small team where they can feel affinity,' he advises. 'But make them feel part of something big. They are not just emptying bins, they are making the municipality beautiful - give them a higher purpose.'

Even the Royal Mail recognises that the car raffles worked only as part of a synchronised effort to tackle absenteeism. Steve Boorman, chief medical officer at Royal Mail Group, presides over a package of measures including health screening for employees and support services, such as physiotherapy.

The company also introduced health clinics and promotion campaigns, as well as installing fitness centres on its larger sites. A £350,000 occupational health and gym facility was introduced at Royal Mail's main London sorting office. Managers now receive training in how to deal with staff who are regularly off sick, which includes advice to keep in regular contact with persistent offenders, and more closely manage attendance records.

Boorman says that the company's scheme has massively cut absenteeism, which is now below three per cent in the best performing areas of the company, and below five per cent overall.

Asked whether the car raffle was the reason behind the fall in absence, he says that it was an important factor. 'A lot of people have characterised the car raffle as just turn up and win,' he says. 'But what it was, if you'll pardon the pun, was a vehicle for internal communication. It allowed us to talk and publicise non-attendance all over the company.

'We put up posters for it and had meetings with local managers about the impact of absenteeism on the company. At the same time we were able to talk about how to support people in their areas who had been absent.'

He claims the media misunderstandings about the car 'gimmick' have been helpful when it comes to communicating internally.

PAYING DUE ATTENTION

'Media attention was no bad thing. Our people saw it and were able to look at our absenteeism rates from another angle. Our customers saw it as well, so they were able to see that we were doing something about our problems.'

Boorman says the company has now stopped the initiative because 'it has less impact as people are more and more aware of it'. Instead, the company is focussing on less headline-grabbing ideas, such as how to support people when they are off work, as well as providing occupational and physical therapy.

He says that, although Royal Mail is a big company, workplace health schemes should still be considered by smaller employers as well. 'It's like a ship's crew,' he says. 'The loss of one person is even more important when there are fewer people.'

IHC's Roberts says that one reason why incentives like the car scheme can have a positive effect upon attendance is that employees who are behaving well finally feel they are getting noticed.

'A lot of management time is spent on people who are off, and the people who are just there doing the job are ignored,' he says. 'It is motivational, being recognised for attending.' However, before companies go out and buy cars from the nearest forecourt, Roberts suggests a cheaper alternative: 'Lunch with the regional director works just as well.'

Gift vouchers are another alternative that some companies are already using to reward employees and increase motivation. Derrick Hardman, managing director of Capital Incentives & Motivation, runs a company offering different incentive schemes to employers.

He says while some companies in the UK do offer vouchers or other perks for good attendance, it is not yet common. 'It tends to be used on time-limited projects, or if something is winding down. Royal Mail had a fairly big problem and that necessitated a pretty big solution,' Hardman explains. 'In the ordinary world incentives can play a part to encourage attendance, but really, turning up is part of your normal job.'

However, Hardman says that vouchers and new replacements, such as branded prepaid cards, are popularly used to reward people who have performed 'over and above' their job description. They are popular in organisations such as call centres, where they are often linked with customer satisfaction.

Hardman says that appropriate incentives can be an important part of positive internal communication, especially if those incentives are appropriately branded. 'Every time a member of staff takes that card out of their pocket they will remember who gave it to them,' he adds.

And the cost of the schemes, if successful, can be neglible. Royal Mail claims that the cost of its car raffles was cancelled out by the savings made when more people turned up for work.

Not all organisations can afford to offer cars or raffles but if a few gift vouchers can solve a serious absence problem then perhaps it is worth considering. After all, if these schemes generate positive internal and external publicity and cut the cost of absenteeism, they may not be such a lottery after all.  

share me: del.icio.us | digg | reddit | Tweet