Absenteeism and the Australian Public Service

Parliament of Australia

Research Service Background Paper

Constance Larmour Director Education and Welfare Research Group

19 April 1990

This paper has been prepared for general distribution to Members of the Australian Parliament. The views expressed in the paper do not necessarily reflect those of the Research Service or of any part of the Parliament. • The content of the paper may be attributed to the aiithor. .'

ISSN 1034-8107

Except to the extent ot the uses permitted under the Copyright Act 1968, no part of this publication may be reproduced or transmittea in any form or by any means, inclUding inlormalion storage and retrieval system, Without the prior written consent ot the Department of the Parliamentary library. Reproduction is permined by Members of the Parliament ot the Commonwealth in the course ot their official duties.

Published by the Department of the Parliamentary library, February 1990. This paper was undertaken as an Executive Development Scheme project with the co-operation and backing of the Department of Finance and the Department of the Parliamentary Library. My thanks to Sue Fergusson, Nick Mersiades, Tim Burke, Gary Hodgson, Julie Pettit, Jamie Pryor, Chris McLennnan and Fiona Duncanson of the Department of Finance; Geoff Winter, Dom Garreffa, Mark Peters, Carole Wiggan, Carol Kempner, Jane Chapman, Diane Hynes, Sandra Bailey, Linda Calis, Paula O'Brien, Mary Lindsay, Bob Stewart and Dennis Argall of the Parliamentary Library; Helen Bladen and Greg Bunnett of the Public Service Commission; Grant Doxey and Dave Roberts of the Department of Industrial Relations; Jordan Serena and Personnel Officers of the Personnel Practices Contact Group, and Mark Wooden of the National Institute of Labour Studies. '. CONTENTS

EXECUTIVE SUMMARY

CONCLUSIONS AND RECOMMENDATIONS

INTRODUCTION 1

Objectives 1

The Need for Action? 1

The Structural Efficiency Principle 2

Review of Absenteeism 2

PROBLEMS OF DEFINITION 4

EXTENT OF ABSENTEEISM: RESEARCH AND SPECULATION 6

(a) Australia 6

(b) The Australian Public Service 8

Survey of Sick leave 1972-73 8

Is Absenteeism a Problem in the APS? 8 (c) Overseas la

AUSTRALIAN PUBLIC SERVICE CONDITIONS 13

Sick Leave Entitlement in the APS 13

Special Leave Entitlement in the APS 14

Effect of Flextime 14

PROFILES OF ABSENTEES AND ABSENTEEISM 17

CAUSES OF ABSENCE: FACTORS AFFECTING ABILITY TO ATTEND 19

(a) Occupational health and safety 19

(b) Off-the-job accidents 20

(d) Family responsibilities 21 ,

CAUSES OF ABSENCE; FACTORS AFFECTING MOTIVATION TO ATTEND 24

(a) Economic 24

(b) Job satisfaction 25

AGE VARIABLES 29

INCENTIVE SCHEMES/ABSENCE CONTROLS 31 Carrots, Sticks or Good Management? 31 OTC 33 Case Studies of Incentive/Absence Control Schemes 34 Overseas 34 Australia 35 Effectiveness of Absence Control Programs 37 Awards with Provisions for Payment of Unused Sick Leave 39 APPENDIX 1 Structural Efficiency Principle - Excerpt from National Wage Case Decision 1989. 43 APPENDIX 2 North American Survey and Anecdotal Evidence on the Benefits of Employer Provided Child Care. 45 APPENDIX 3 Age Retirement - Use of Sick Leave Survey Results. 47 APPENDIX 4 Case Studies. 48 (a) Absences of Teachers in State High School Australia. 48 (b) Incentive Scheme for Teachers - U.S. 48 APPENDIX 5 Sources of Information - Departments, Associations and Companies. 50 ENDNOTES 51 REFERENCES 56 EXECUTIVE SUMMARY

This paper looks at the findings of different research studies on absenteeism with the aim of identifying options and needs which relate to absenteeism in the Australian Public Service (APS). Differences of definition and measurement are apparent in these studies. Some perspective is given by studies of absenteeism in other countries.

In attempts to gauge the extent of labour absence, and of voluntary absenteeism in Australia, researchers have based their conclusions or estimates on a 1977 study by Harkness and Krupinski, the 1983 Australian Bureau of Statistics Health Survey and the 1972-73 Survey of the Incidence of Sick Leave in the Australian Public Service. Harkness and Krupinski found an overall absence rate of 4% for the Australian workforce in a survey which covered absences attributed to sickness and industrial or other accidents, but excluded other forms of leave and industrial dispute absences. The Australian Bureau of Statistics found in 1983 that 2.6% of the workforce was absent on anyone day as a result of illness. Estimates of the amount of voluntary and avoidable absence - the 'sickie' - vary but range up to one day in every five of all work absence.

Public servants are perceived to have generous sick leave entitlements and to take advantage of these. In 1972-73 the average number of absences on sick leave in the APS was 3.7% or 8 days. No current service-wide figures exist. Despite the apparent comparative safety of the work undertaken, and the wide availability of flextime provisions, it seems likely that sick leave absence figures may be higher than in 1972-73.

The 1988 and 1989 decisions of the Industrial Relations Commission listed measures to be considered to effect award restructuring and to increase productivity by enhancing flexibility and efficiency in the work place. One such measure was a suggested review of sick leave, to be undertaken initially in the Department of Social Security, to identify the incidence of and reasons for absenteeism, and to consider what action could be taken to reduce this. This Review will provide more information on current use of sick leave, but a service-wide survey, which can provide a comparison with the 1972-73 survey, is also needed.

Because of the difficulty in differentiating between genuine and non-genuine sickness, it is not possible to pinpoint accurately the percentage of working time lost through non-genuine leave or 'sickie' taking. It is possible to predict higher absence rates on particular days of the week and at different times of the year, and to identify some characteristics of employees which are often associated with higher rates of labour absence. Ability to attend is affected by work related and non-work related illnesses and accidents, other occupational health and safety factors, transport problems, alcohol and drug related problems and family responsibilities. Some of these factors are outside of the control of management, but other factors have scope for management intervention and a resulting positive response. Examples are the industrial programs to cope with alcohol and drug related problems, workplace safety and the provision of flexible working hours and permanent part-time work.

Motivation to attend work involves factors such as job satisfaction, personal work ethic, work group norms, co-worker relationships, organisational commitment, incentives and absence controls. These factors are also greatly affected by management policies and styles of supervision. Case studies are reported to highlight successful practices, and recognition given to the need to support and encourage the majority of public servants and workers who do not abuse sick leave entitlements.

The practice of using up sick leave credits before retirement is examined and the results of a survey undertaken with the co-operation of the Personnel Practices Contact Group is reported. Payment or part-payment of unused sick leave is considered and recommended as an option to reduce this practice.

It is noted that many or most of the factors which tend to increase absenteeism can be addressed by good management practices. Incentive schemes and absence controls are discussed, and the following conclusions are presented for consideration. CONCLUSIONS AND RECOMMENDATIONS

1. That Personnel Sections in all APS departments should be required to set up systems to record and facilitate access to data on use of sick leave, special leave and other types of leave.

2. That from the above data, regular surveys of the incidence of sick leave in the APS should be made to monitor the progress of productivity proposals under the Structural Efficiency Principle (SEP).

3. That a survey of the incidence of sick leave in the APS for the period May 1990 to April 1991 be undertaken using the same terms of reference as the 1972-73 survey, and that comparative findings should be reported.

4. That the role of immediate supervisors in monitoring and counselling in matters of attendance should be strengthened and that supervisors should receive training for this role.

5. That managers and supervisors should ensure that flextime and other conditions of service be administered with the aim of increasing morale and productivity.

6 . That employees should be consulted and involved in developing programs and strategies to provide greater job satisfaction, improved productivity and reduced absenteeism.

7 . That care should be taken in the development of these programs to ensure that the majority of employees who do not abuse sick leave entitlements do not become disaffected or feel threatened with the removal of the existing 'safety net' of sick leave provisions.

8. That use of leave, including sick leave and special leave, should form a part of performance appraisal and individual development programs, and that individual records on performance should include a more detailed section on attendance, including number of days and type of leave, and use of flextime.

9. That departments should extend provision for permanent part-time work and flexible 'standard days' and have regard to their obligations to workers with family responsibilities. Progress in the ACTU test case on parental leave and special family leave should be monitored closely and costs and feasibility of increased access to unpaid leave should be investigated.

10. That occupational health and safety concerns of employees should continue to be investigated and addressed. 11. That supervisors, and employees with attendance problems, should be encouraged to make use of programs such as those provided by the Industrial Program Service.

12. That the growing practice of payment or part payment of unused sick leave credits in industry should be monitored.

13. That the Overseas Telecommunications Commission be asked to provide data on the use of sick leave before and after the introduction of the 20% entitlement to accumulated sick leave on retirement.

14. That a similar scheme (such as payment of 20 - 25 % of unused sick leave) within the APS should be initiated for a trial period in terms of a SEP restructuring exercise. 1

ABSENTEEISM AND THE AUSTRALIAN PUBLIC SERVICE

INTRODUCTION

Objectives

By reviewing current research on absenteeism, particularly that having relevance to the Australian Public Service (APS), this paper aims to draw together what is known, to highlight areas where further studies are needed, and to identify successful strategies in combating the misuse of sick leave.

Much available research concentrates on the problem of voluntary or non-genuine sick leave, commonly known in Australia as 'the sickie'. This type of leave taking appears more of a problem in many European countries than in Australia, but a culture of condoning the practice of taking an occasional 'sickie' does appear evident in sections of the Australian work force. Some current studies suggest that the practice is more prevalent in the Australian public service than in the Australian work force generally, and this paper reviews the evidence presented.

The Need for Action?

The entitlement to sick leave is a hard-won and valued condition of service in Australia and overseas, and not least in the Australian Public Service. It is a safety net for the bad luck in the form of illness or accident that can happen to anyone. It has long been.regarded as a right rather than a privilege, and it would appear unwise, if not impossible, in industrial relations terms to attempt to remove or reduce. the existing provisions. That the entitlement to sick leave is abused to some extent is not disputed, nor is the fact that absenteeism can vary significantly between different work areas. However, in seeking to reduce absenteeism or voluntary absence in the Australian Public Service, departments must be sensitive to the need for . measures which do not act as disincentives to the majority of employees who do not abuse the sick leave entitlement. 2 The Structural Efficiency Principle

In its August 1988 decision, the Australian Industrial Relations Commission set the structural efficiency principle (SEP) as the central element in a new system of wage fixation. The object was to give incentive and scope to the parties to examine and modernise their awards so as to better meet the competitive requirements of industryl.

The 1988 decision listed measures to be considered including ensuring that working patterns and arrangements enhance flexibility and the efficiency of the industry2.

In its February 1989 review decision, the Commission made it clear that SEP exercises should canvass a broad agenda, and spelt out some of the efficiency measures it considered appropriate for consideration. These stressed greater flexibility in arrangement of working conditions such as hours of work, and included a suggested review of sick leave provisions with the aim of avoiding misuse.

Review of Absenteeism

In 1987, in the context of the 4% second tier pay increases for office based and related classifications, agreement was reached between the public sector unions (ACOA, APSA, FCU) and the Government to undertake a review of absenteeism, initially in the . Department of Social Security. It was considered that the improved work environment resulting from increased staff mobility at the workplace and flexibility, together with greater job satisfaction for staff, should assist in reducing the incidence of absenteeism3 .

An interdepartmental committee (IDC), set up in that year, 1987, with representatives from the Department of Industrial Relations (DIR), Department of Finance and Department of Social Security (DSS) had concluded that agreement should be sought with the unions that they would work together with Departments on ways to reduce absenteeism.

The Review of Absenteeism Working Party met first on 26 April 1988, with representatives from the Department of Social Security, the Public Service Commission and the public sector unions. The terms of reference for the Review of Absenteeism were:

to examine the extent and causes of absenteeism, initially in the Department of Social Security, and

to make recommendations on an agreed approach to reducing the level of absenteeism. . 3 In particular the Review was to: 1. Identify the incidence of absenteeism in the Department being examined, including any variations between areas, and to compare this level of absenteeism to general community levels.

2. Identify the possible reasons for absenteeism including staff morale, staff participation in decision-making, types and levels of accidents, stress levels, the public contact environment, any requirements to work excessive paid or unpaid extra hours and the impact of parental responsibilities.

3. Identify the current policies and practices of the Department to absenteeism and what action, if any, has been taken towards reducing the level of absenteeism.

4. Identify and examine the appropriateness of existing policies and practices relating to absenteeism.

Stage 1 of the Review was conducted by the Australian Bureau of Statistics and involved a sample of 10% of the 17,000 employees of the DSS and their leave usage. The Interim Report on Stage 1 by the consultants (the Australian Bureau of Statistics) has been considered by the Working Party which has decided not to release any findings until the completion of Stage 2 of the Review . because of their 'sensitivity' and the possibilities of misinterpretation by other agencies. Stage 1 data should reveal the overall level of absenteeism in the department and perhaps also indicate variations in locations or work areas which will have implications for management.

Stage 2 of the Review involves a different sample but with the same break up of age, classification, location and sex and entails the development, processing and analysis of a questionnaire designed to elicit the reasons for absences. The questionnaire will seek to discover attitudes to work, conditions and management, as well as factors such as family responsibilities, peer attitudes, interpersonal relationships and availability of leave, including special leave. However, unless questions on the reasons for taking sick or special leave include voluntary absence, it is unlikely that the resulting data will be sufficiently comprehensive to include an accurate assessment of 'misuse of leave'.

As the second stage of wage increases for the public service this year is contingent on progress being made on the agreed measures to improve efficiency (including the review of absenteeism and the identification of measures to decrease its incidence), the length of the review process is causing concern. However it is important that the data produced by the Review is sound and can lead to an accurate assessment of the effectiveness of policies and practices relating to absenteeism. It seems likely that before major new policies can be implemented to reduce absenteeism, a more widespread survey of current sick leave and special leave usage in the Australian Public Service will be required. 4 PROBLEMS OF DEFINITION

According to the Shorter Oxford English Dictionary absenteeism is 'the practice or condition of being absent,4, a definition which perhaps embraces both the state of absence and the suggestion of a conscious decision being made.

The 'absenteeism' being investigated by the DSS Review does not appear to have been defined. The Review is seeking to quantify, and assess the reasons for, sick leave and special leave, but whether or not abuse of leave will be considered remains a sensitive question. No definition has been issued by the Industrial Relations Commission to cover such studies.

Many research papers have been written on the problems and causes of absenteeism. In many cases these are studies of 'labour absence'. Often, though, the term 'absenteeism' is used to denote absence which is both 'avoidable' and 'voluntary' - in other words as a synonym for 'the sickie,5.

In his paper, A Taxonomy of Measures of Absenteeism, R.G. Ensley indicates some of the problems of definition and measurement which exist in the current studies of absenteeism:

Absenteeism has been studied for several decades. During that time many measures of absenteeism have been devised. The profusion of measures contributes to the difficulties faced by business practitioners and researchers who seek to study absenteeism. These difficulties are increased when measures are not clearly defined... The third source of confusion [is] the distinction between voluntary and involuntary absence ...

Ensley identifies 25 different measures of absenteeism. He claims that many writers concentrate on attempts to measure voluntary absenteeism but ignore problems associated with a workable distinction between 'voluntary' and 'involuntary':

A particular problem in distinguishing between involuntary and voluntary absenteeism is the difficulty of defining sickness6 •

This is demonstrated by the ABS finding in its nation-wide survey of the health of Australians in 1983 that, during a two-week period, 61.9% of all employed persons had experienced some illness condition, but that only 7.5% took any time off work as a result7 .

Nor is it possible to differentiate between 'certificated' (i.e. with an accompanying medical certificate) and 'uncertificated' sick leave as a measure of genuine illness as opposed to 'the sickie'. As has been pointed out8 , it is often not difficult to obtain a medical certificate for non-existing or non-serious conditions. On the other hand, doctors now rarely make house calls in Australia, and a person with an acute but known illness such as influenza may recover more quickly without a visit to a doctor or hospital. 5 That voluntary absenteeism or 'sickie' taking occurs, and that there is a culture of acceptance of this practice within the Australian workforce including (and some researchers consider especially in) the Australian Public Service, are widely held beliefs9 . Perhaps sharing this belief, the Industrial Relations Commission has identified the reduction of this type of voluntary absence on paid sick leave as one way of achieving greater efficiency throughout the public sector.

In reviewing the literature on labour absence and absenteeism, statistics and findings will be quoted in this paper. This is not to suggest that the statistics quoted are either comparable or conclusive, but merely to indicate the perceptions of absenteeism which exist.

This paper will not attempt a definitive break down of what is voluntary and avoidable labour absence attributed to sick leave. Nor will it try to distinguish between genuine illness warranting absence anq non-serious, imaginary or non-existent illness. Rather it will look at some reasons for such absence which have been identified in the research to date on absenteeism, and will consider the options for reducing these types of absences. 6 EXTENT OF ABSENTEEISM: RESEARCH AND SPECULATION (a) Australia

In October 1973 and again in October 1976 the Human Relations Branch of the then Department of Productivity carried out surveys of absences in manufacturing and non-manufacturing work establishments throughout AustralialO . The October 1976 survey found an overall absence rate of 4.0%, a slightly but not significantly lower rate than for 1973. Thus on average the survey found that in anyone year, 4% of the Australian workforce would be away from work on any day as a result of absenteeism, sickness and accidents, and another 0.23% would be absent because of industrial disputation (a total of 4.23 % or 57.2 million days in 1976)11. This study has been quoted widely and forms a basis for much subsequent Australian research.

Using these figures, Crawford and Volard in a 1980 study sought to produce estimates of 'temporary non-approved work absence' in Australia. Of these absences, which included sick leave and industrial disputes, Crawford and Volard attributed 18.9 % to 'the sickie' or 'absenteeism' and another 17.8 % to alcohol and other drug abuse. This Crawford and Volard figure of 18.9% of temporary non-approved work absences attributed to 'the sickie' has been often quoted since publication of their findings in 1981, but this is probably because little hard data is available. Such a figure would mean that 0.8 % of the workforce could be expected to be 'taking a sickie' on anyone day. The authors admit that the figure of 18.9 % was what was left after absences were attributed to other factors such as disease (respiratory, circulatory, musculoskeletal or nervous) and other sicknesses, accidents, industrial disputes and substance abuse12 . The term 'non-approved work absence' can be misleading as sick leave is usually approved, albeit usually after the event.

According to the 1983 ABS health survey, overall, on anyone day 2.6 per cent of the workforce was estimated to be absent from work as a result of illness. The most common types of illnesses were headaches, minor respiratory illnesses such as the common cold or influenza, and complaints of the digestive system. The most common causes of sick leave absences were injuries, influenza and spinal and back problems13 . The occupation which was most absence prone was that of miners, while the least absence prone were service workers, and administrative, executive and managerial workers. 7 Estimates of temporary non-approved work absence in Australia from Crawford and Volard, 'Work Absence in industrialised societies: the Australian case' 1980.

1.> '0'9< ",0\0 o ,,'0' OCher, oH-lhe·job -;. '"'% accidents ,..:> "'0 10.0% Alcohol abuse --.:I 0" . g ~" 13.8% Industrial Other drug abus~ accidents "" 4.0% 6.3%

!ndustrial disputes 5.5% 'Other' sicknesses 9.3%

"The sickle" 18.9% 3.8%

Musculoskeletal diseases Respiratory diseases 15.5% "09 '''0 -0 8 (b) Australian Public Service

Survey of Sick Leave 1972-73:

In 1974 the Public Service Board reported its survey of the incidence of sick leave in the Australian Public Service for the period May 1972-April 1973. This survey found that an average of eight days sick leave was taken by all staff. Of this an average of 6.7 days was on full pay. Male staff averaged 7.4 days (6.5 days on full pay), and female staff averaged 9.9 days (with 7.5 days on full pay). A steady increase in leave taken with age was apparent for men over 39 years, but for women the average remained much the same (about 9.9 days) for all age groups. Permanent officers averaged 7.6 days (males 7.0 days, females 9.7 days) while temporary employees averaged 8.8 days (males 7.9 days, females 9.5 days).

During the year, 8.8% of all staff took no sick leave (10.1 % of males and 5.1% of females). With increasing age the proportions of employees taking no uncertificated leave rose dramatically (from 7.4% for the under 18 age group to 22.2% for the 55-59 age group). The proportion taking no certificated leave was steady over all age groups. During the year 46% of staff took fewer than 5 days sick leave14 .

Is Absenteeism a Problem in the APS?

A widely held perception is that public servants tend to take more sick leave than other employees. For example, an editorial in the Australian of 1 November 1989, citing no sources, alleged that public servants take 16.4 days sick leave per year on average compared with the industry average of 4 days per year. More reliable research,15 however, points to statistical evidence that public administration is second only to mining in terms of absence-prone occupations, ahead of transport and storage and other 'heavy' occupations.

No current figures are readily available and personnel areas of public service departments report that their computers systems are not yet geared to provide breakdowns of leave taking. For most departments, any coilection of personnel statistics on the taking of sick and special leave, for example, still involves a manual search of the files of individual officers16 .A Senior Research Fellow at the National Institute of Labour Studies, Mark Wooden, has commented:

...it is notoriously difficult to obtain data on absence levels from public sector agencies (which undoubtedly serves to reinforce further the perception that there is a problem)17.

Wooden concedes that what figures exist do not provide much of a guide to the extent of any difference between the public and private sector. Indeed, he quotes an absence rate of 3.5 % for public administration (one of the public sector areas which he considers), which is only marginally above the non-manufacturing industry rates discovered in the 1977 Harkness and Krupinski study (3.4 %). One problem, of course, is that many of the 9 assumptions are drawn from the 1983 Health Survey and comparisons are made with the 1977 absence study. The conclusion Wooden has reached is:

Data on illness related absence from work indicates that labour absence is particularly pronounced in industries dominated by public sector employment. This conclusion holds after controlling for a number of demographic and employment related influences usually thought to be associated with non-attendance at work, and even after the imposition of the extreme assumption that all absence that is associated with a medical consultation or with the taking of medication is involuntary. Given the implausibility that the observed inter-industry differences can be explained by uncontrolled variations in the healthiness of work environments, it appears likely that the high levels of public sector absenteeism must reflect factors such as low job satisfaction, more generous sick leave entitlements and conditions surrounding the use of such entitlements, greater job security, less effective control mechanisms, and less competitive pressures, and hence greater inefficiency, within the public sector. Investigation of the relative importance of these alternative explanations awaits further research18 .

One theory of absenteeism points to its availability as a cause of the problem, noting that the amount of leave taken often relates to the amount of the entitlement. In identifying 'more generous' sick leave entitlements as one of the reasons predisposing public servants to greater levels of absenteeism, Wooden cites a 1984 survey of State awards which showed only 18%, many of which were awards covering statutory authorities or local government employees, as providing more than 10 days sick leave.

What information we have indicates that some sections of the public service, at least, do have higher sick leave rates than industry generally or in comparison with other public service areas. For example, the average number of days per year taken on sick leave for the Commonwealth Employment Service in 1986-87 was 10.78 days, although the A.C.T. offices averaged the 16.4 days sick leave quoted by the Australian editorial referred to above. 19 During this period the CES was being restructured, and the ACT Office faced a merger with N.S.W. Similarly, other high stress areas or departments such as the Taxation Office or counter areas of the Department of Social Security are thought to have markedly higher sick leave rates than the service-wide average. A 1988 review of sick leave usage in the central office of the Department of Finance (which is considered a low-leave department) found a sick leave rate of 3.5% or 7 days average, excluding compensation leave 20. 10 Without the benefit of up to date and reliable statistics, it is impossible to draw any conclusions as to the extent of the problem of absenteeism in the Australian Public Service or even to assert that the average amount of sick leave taken has increased since the 1972-73 survey. For the purposes of the Structural Efficiency Principle measures to be taken by departments, Personnel Sections should be advised in advance that these statistics will be required and that they should set up their systems accordingly.

Conclusions:

Personnel Sections in all APS departments should be required to set up systems to record and facilitate access to data on usage of sick leave, special leave and other types of leave.

From the above data, regular surveys of the incidence of sick leave in the APS should be made to monitor the progress of productivity proposals under the Structural Efficiency principle.

A survey of the incidence of sick leave in the APS for the period May 1990 to April 1991 should be undertaken using the same terms of reference as the 1972-73 survey, and the comparative findings should be reported.

Absenteeism is a problem of international concern. Again it is difficult to make statistically valid comparisons but it is interesting to note the perceptions presented in various studies of lab9ur absence in other countries. One comparative study, reported in a 1978 Monthly Labour Review, has placed Australian absenteeism rates as marginally higher than those of the United States, over all, but substantially lower than those of Western Europe. In comparison with the October 1976 absenteeism rate of 4 per cent in Australia, the study cited a rate of 3.5 per cent in the U.S., but 11 per cent in West Germany, 10 percent in the Netherlands and 15 per cent in Italy.21 Steers and Rhodes, 1984, allege that overall absence rates in Western Europe range from 14 per cent in Italy to a low of one per cent in Switzerland, with France ranking as second to Italy in high absence rates. They quote a United Kingdom figure of 13.5 days lost per employee in sick days per year (or over 300 million workdays). Yet another study on the U.K. states that a 1985 survey revealed that 11 working days per capita in sickness absence were lost in a working year. This study quoted a 'mean sickness rate' of 4.6 per cent. Absences attributed to personal reasons or industrial disputes were not included in these figures. 22 Different studie measure different things and so these rates may not be strictly comparable. However it is clear that the problem is a very costly one, as is shown by U.S. and Canadian studies especially. 11 Overseas research into factors affecting work attendance complements that done in Australia and is useful in helping to identify management strategies to combat unnecessary absence. These comparative studies are also useful in putting the Australian experience into perspective. A study on 'The Swedish Economy' was featured in the Economist of 3 March 1990. In part this report states:

On a typical day, one in every four workers is absent from his office or factory. About 10% of workers are sick, while 15% are looking after children, on study leave, on holiday, or off for one of the 101 reasons for which they are entitled to take leave. It is little wonder that Sweden is plagued by labour shortages.

In the past 50 years the Swedish labour force has increased by 30%, yet the total number of hours worked has fallen by 15%. The formal working week is still 40 hours, or about 1,800 a year - one of the longest in Europe ~ but the average Swede clocks up only 1,482 hours, the fewest in any OEeD country. This is partly due to the high rate of participation in the labour force .•. As many as 86% of women with children too young to go to school have jobs, compared with just 28% in Britain. Many of these work part time or need to take time off to look after their offspring, thereby pulling down the average number of hours worked.

Though the so-called "laziness" of the Swedes may be partly explained by the higher participation rate in the labour force, absenteeism is also encouraged by Sweden's generous social- security benefits and rules on parental and educational leave. No other country smiles so much upon working parents. After the birth of each child, a mother and father are entitled to take 15 months' paid leave between between the two of them to look after the child. The first 12 months are paid by the social insurance system at 90% of normal pay, the final three months at a fixed rate. Parents can also take up to 60 days' paid leave a year to look after a sick child under the age of 12.

If the workers themselves are sick they are paid 100% of their normal salary from the first day of illness. No doctor's note is required for the first week and there is no limit on the number of days' sick pay that a worker can claim each year. ,In fact, because of the way sick pay is calculated, shift workers may sometimes enjoy a higher net income by staying at home. Small wonder that Swedish workers, who have the longest life expectancy in Europe and look the healthiest, can also claim to be the sickest. 12 The average Swedish worker was off sick for 26 days in 1988, up from 18 in 1983. The average worker in the engineering industry was ill on 29 days, far more than in any other country and well above Britain's 11 days and West Germany's 18. Not only does this cost the government dear in sickness benefits, it is also disruptive for employers. They can never be sure how many workers will show up on any day, forcing them to employ more workers than they strictly need. Absenteeism is one factor Swedish businessmen always mention when they talk about shifting production abroad. ..

The Swedish system of sick pay is much more open to abuse than in other countries. Not only is there no limit on the number of days that can be claimed but sick pay is doled out by the state insurance system, not by the company as in America. So claims are badly monitored. Workers claim their sick pay from anonymous social-security offices, where often they need only speak to an answering machine. One study discovered that 10% of workers who had claimed sickness benefit had actually been working (either in their usual job or in a second job) on those days. And because Sweden has such a tight labour market, workers have little fear of losing their jobs ...

To crack down on abuses of absenteeism and help relieve labour shortages, the Social Democratic government was planning to make employers responsible for sickness benefit for the first two weeks of illness. Firms would then have a greater incentive to monitor claims, while workers would perhaps be more reluctant to cheat their own company than the state. In a trial carried out by the employers' federation, absenteeism was cut by as much as a quarter when firms administered sickness pay. 13

AUSTRALIAN PUBLIC SERVICE CONDITIONS

Sick Leave Entitlement in the APS

Full-time Commonwealth Public Servants in Australia are now eligible for two weeks sick leave on full-pay and two weeks sick leave on half pay in each year. Sick leave credits accumulate without limitation throughout the period of service. Accordingly, the emphasis in the Public Service is that of greatest benefit for long-serving and conscientious staff. Up to five days paid sick leave, with a maximum of three consecutive days, may be taken without a medical certificate in anyone year. At the end of the period with the Public Service, no payment in lieu is made for unused credits of sick leave23 .

The .first provision of sick leave for Commonwealth public servants was by means of the 1903 regulations which provided what must have been considered generous arrangements for that era. Leave was provided on the basis of a triennial period, and a scale of full pay and half pay entitlements applied, depending on length of service. For example officers with more than 10 years service could be granted up to three months sick leave on full pay over the three years. Additional provisions for half pay, one third pay and leave without pay could apply in cases of need.

In 1926 sick leave provisions were reviewed by the Public Service Arbitrator who questioned the principle on which the grant of sick leave was made. His point was that:

Primarily the employer pays for services rendered. If by reason of sickness the employee does not render service why should the employer be bound to continue payment?

Having decided that an obligation to provide sick leave did exist, the Arbitrator decided that the amount should be 12 days on full pay, 8 days on half pay and 6 days on one third pay. Leave could accumulate but the most which would be taken in any continuous absence was set at 52 weeks. An officer who was to be retired on the grounds of invalidity was entitled to first exhaust all accumulated credits of sick leave. In 1932 this provision was limited to the taking of only up to 52 weeks credited leave before invalidity retirement. A more detailed history of Sick Leave provisions in the Australian Public Service is appended to the 1972-73 Public Service Board survey24. 14 Provisions in private industry were far less generous than those for public servants in earlier years. Five days paid sick leave was introduced in the metal trades and metal industries awards in 1952. This provision remained unchanged until the Metal Industry Award, July 1971, which extended sick leave provision for employees with more than one year's service to eight days, and accrual rights were extended from one year to four years (i.e. up to 32 days). From the 70s the number of days of paid sick leave entitlements, and the length of accrual time have been progressivelyextended25 . Many industry awards now contain sick leave provisions which exceed those applicable in the public sector26 . The generalisation that Public Service sick leave entitlements are more generous is probably becoming less accurate.

Special Leave Entitlement in the APS

A total of three days special leave in anyone year may be granted to permanent and temporary employees of the APS to cover such contingencies as the illness of a spouse or dependants, moving house, emergency situations in the home, death of a family member (in conjunction with bereavement leave), the funeral of a relative or friend, car accidents (half day), wildcat transport strikes (half day), graduation ceremonies, departmental sports days, appointment as a polling official and interviews for enlistment in the defence forces or reserve forces.

Effect of Flextime

By March 1974 a significant number of departments had introduced trial flexible working hours schemes, and the introduction of further trials was suspended to enable the Public Service Board to assess the various schemes then operating.

The Board estimated that, overall, because flexleave was used to cover short absences not previously taken as formal leave (late arrivals, visits to the doctor, extended lunch breaks etc.) productive time had increased by the equivalent of 15 minutes per officer per week. Data from most departments showed a decrease (some a marked decrease) in the amount of non-certificated leave taken under flexible working hours as compared with standard hours, e.g. the Department of the Prime Minister and Cabinet reported a 19% decrease in non-certificate sick leave for one day or less. Several departments reported a decrease in the number of applications for short-term recreation leave, with a consequent reduction in the processing of applications in personnel records sections. The Department of Transport (Central Office, Melbourne) reported an overall drop in leave applications of 39.4% during the trial period as compared with the pre-trial period27 . 15 A later review of Flextime in the Australian Public Service was undertaken in 1987. Although respondent departments tended to provide qualitative rather than quantitative evaluations, the review team was able to conclude that:

Service-wide, the benefits of flextime can be seen to clearly outweigh costs.

Savings directly attributed to flextime included reduced overtime, better use of capital equipment, and more efficient use of staff time. Many departments quantified these types of savings. Other benefits for public service operations were identified, including reduced sick leave, special leave and other short term leave. The volume of support for the contention that flextime led to decreases in both sick leave and overtime is illustrated by the graphs presented in the report (next page)28.

Conclusion:

That managers and supervisors should ensure that flextime and other conditions of service be administered with the aim of increasing morale and productivity. 16 Responses to Flextime Survey: Departments and Authorities Report on Flextime in the Australian Public Service, 1987.

Improves Recruitment/Retention

60 50 40 30 20

'0 o Ves No No opinion

Effect on ovenime

60 50 40 30 20

10 o ,'------__ Increase Decrease No e/fecl No opinion

Effect on Sick leave

50 40

10 0+...1----_ Increases Decreases No effeCl No opinion

Ertect on services to the public

50 40 30

20 , 0 o Increase Decrease I No effect No opinion 17 PROFILES OF ABSENTEES AND ABSENTEEISM. Although it is impossible to measure accurately the amount of 'avoidable' or 'voluntary' absence, anecdotal evidence together with patterns of absence suggest that some of the leave taken as paid sick leave or paid special leave should be classified rather as voluntary leave i.e. the 'sickie'. This problem is not of course confined to the Public Service.

About 90% of all uncertificated sick leave in the Public Service in 1972-73 was of one day'S duration. Monday and Fridays are the days on which most sick leave is taken. This has held for surveys of manufacturing and non-manufacturing industries and for the public service. The Survey of the Incidence of Sick Leave in the Australian Public Service 1972-73 found

Although major differences are evident in the days of the week on which one and two day absences were taken, no significant differences were noted between certificated and uncertificated absences, or between men and women. 25.0% of all one day absences were on F~idays, 23.8% on Mondays, 16.8% on Tuesdays, 17.6% on Wednesdays, and 13.7% on Thursdays. (3.1% were on Saturdays or Sundays ... )29.

All surveys found lower incidences of sick leave taken on Saturdays or Sundays where penalty rates applied.

A U.S. study on absence frequency, reported in the Journal of Applied Psychology in 1983, found prior absenteeism to be a strong predictor of absenteeism30 . In detailing a N.S.W. case study on sick leave, Dawn Linklater reported that 20% of the employees had taken 60% of the leave31 . Research in South Australia showed that 30% of employees have 90-95% of all absences, according to an executive of Work Health. 32 Similarly, a French study found that while 50% of French workers never miss a single day of work, of the remainder over 80% take more than 40 'sick days' per year. 33

Studies have failed to find whether absence repeaters have more ill health than the rarely absent employee, or whether they are merely more likely to be absent. In an article published in the Medical Journal of Australia, Ferguson claimed that studies have shown that many sickness absence repeaters have little chronic or recurrent disease while many who are rarely absent have much such disease: .

Physical examination at anyone time is a poor predictor of absence, and absence is a poor indicator of physical ill health. Absence is a measure of acute ill health, mostly, and physical examination is a measure of chronic ill health; different things are being measured. 34 18

Many studies reported, in general, higher absence rates for employees who were female, single parents, young, near retirement, less educated or in lower status jobs. Significantly lower absence rates were reported for supervisors and managers and the self employed. However conflicts exist between the reports when looking at specific characteristics of employees as predictors of voluntary absenteeism. 19 CAUSES OF ABSENCE: FACTORS AFFECTING ABILITY TO ATTEND In considering the causes of labour absence - time spent away from work when, in the normal course of events, a worker would be expected to be present in the workplace35 - researchers have pointed out that work attendance is influenced by both the ability to attend and the motivation to attend. The ability to attend will be limited by illness and accidents, transport problems and family responsibilities36 . This paper does not include any discussion of transport problems nor does it try to define what constitute 'genuine' illnesses or accidents.

(a) Occupational health and safety

In terms of likely accident or death in the workplace, public servants probably enjoy the safest working conditions of any occupational group. A study of deaths as a result of work related injury in Australia 1982-1984 revealed that clerical workers had the 'safest' jobs, i.e. the lowest incidence of fatal work injuries of any occupational group37.

An analysis of the 1983 Health Survey revealed that the least accident prone occupations were those of transport and communication workers, clerical workers, administration, executive and managerial workers, sales workers and professionals. Yet in terms of the incidence of work accidents, public administration emerged from this survey as a more dangerous industry than manufacturing38 .

Factors such as stress levels, repetition strain injuries, and the effects of working in air conditioned offices could contribute to greater than expected levels of sick leave for the APS. A Western Australian study of stress levels in a range of occupations has reportedly revealed that public servants suffer from the most stress, especially where workplaces are being restructured39 .

Professor Robert Spillane of Macquarie University is reported to have related accountability and autonomy factors to stress in the workplace. He claims that low autonomy and low accountability can lead to stress in the form of boredom and underload, whereas low autonomy and high accountability could lead to stress in the form of overload and inability to cope. Work entailing high autonomy and low accountability may not be stressful but may not necessarily be productive. The optimum situation was on of high autonomy and high accountability, provided the worker was, and felt, competent. 40

In any program to cut absenteeism rates, occupational health and safety considerations are extremely important. According to the Crawford and Volard study of work absence in Australia, 6.3% of all temporary non-approved work absence in Australia results from industrial accidents. Obviously this is an area in which management intervention and action should lead to a reduction of labour absence. This factor has been recognised within the APS and on-going programs and strategies have been adopted by departments. This paper will not encompass consideration of these factors except to note their importance. 20 Conclusion: Occupational health and safety concerns of employees should continue to be investigated and addressed.

(b) Off-the-job accidents

Estimates provided by the Crawford and Volard study were that traffic accidents and other off-the-job accidents accounted for 12.2% of all temporary non-approved work absence in Australia. Where compensation provisions apply, as in compulsory third party insurance for motor-vehicle accidents, an amount to cover wages lost as a result of the accident may be included in the compensation paid. An employee who is covered by paid sick leave provisions may have the option of having sick leave credits reinstated through payment of the wages component of the compensation back to the employer, or of being paid twice for the period of sick leave taken after an accident. Where an employee with plenty of accrued sick leave thus has the option of double pay, there is a strong disincentive for an early return to work after the accident.

The amount of absenteeism resulting either directly or indirectly from alcohol and drug abuse is difficult to assess accurately, but there is no reason to think that the problem is any less important in the APS than in industry generally. Sixty to 70% of people with drug and alcohol problems are in employment. In any work place an estimated 5% of employees may have alcohol or drug problems and related problems. Some estimates place the absenteeism rate of employees with alcohol and drug problems as 200 - 300% higher than that of other employees41 . Crawford and Volard estimate that as much as 17.8% of all temporary non-approved work absence in Australia results from alcohol and drug abuse (13.8% from alcohol abuse and 4.0% from other drug abuse).42

Senator Vanstone recently advocated a procedure of screening for drugs as a standard part of public and private sector employment recruitment. She cited the case of the U.S. Postal Service where during a trial period beginning in 1987, tests of 4375 new employees revealed that 8.4% tested positively to illegal drugs and these employees were found to have an absenteeism rate 43% higher than those who returned a negative result. It has been claimed that the testing of urine samples could be made as part of the existing medical examination by Commonwealth Medical Officers on entry to the Public Service. A precedent for such pre-employment drug screening was set by Qantas in 1985: throu~h such programs Qantas claims to have halved its sick leave rate4 . 21 Counselling and advice for alcohol and drug problems in the workforce are available to supervisors and employees through State bodies such as the Industrial Program Service in the A.C.T. and in N.S.W. A wider service is now provided than the former 'alcohol and drug counselling' and supervisors are trained in methods of dealing with problem employees and referring them for counselling on the basis of poor performance. Through the National Employee Assistance Program Executive, formerly the National Alcohol and Drugs of Dependence Industry Committee, non-profit government funded organisations such as the Industrial Program Service are providing counselling and assistance, and are researching the problem of drug related absenteeism in Australian industry. Already these programs cover 10% of employees. Reports and recommendations from these organisations should receive the careful attention of the APS. An Australian study on the comparative absence rates of smokers and non-smokers found that absenteeism of male smokers was over 50% greater than that of male non-smokers (the rates reported . being 13.8 days per year compared with 8.2 days per year respectively). For female smokers the absenteeism rate was found to be 12.6 days compared with 12.3 days for non-smokers44 . This problem has been addressed to some extent by the decision to make public service buildings smoke-free work places, and by the encouragement of Quit programs run by such bodies as the Industrial Program Service.

Conclusion:

That supervisors, and employees with attendance problems, should be encouraged to make use of programs such as those provided by the Industrial Program Service.

(d) Family responsibilities

To the extent that family responsibilities are seen as a factor affecting both the ability and motivation to attend work, the question of absences caused by family responsibilities is relevant to this study.

The participation of women in the workforce has increased steadily, reaching 52.2% by January 1990. Between July 1979 and December 1989 the percentage of mothers of dependent children, who were in the labour force, rose from 44% to 59%. In January 1990, 38.8% of all employed persons had dependent children. 45

Most research studies on absenteeism report a relatively higher probability of absence for employees who are female or who are single persons with dependent children. Wooden and Robertson report that spouses with dependent children have a low absence probability, but although absent infrequently, when absent they take a relatively large number of days off work 46 (possibly reflecting the length of illness of a child). In his most recent study Wooden reports that the presence of dependent children has ambiguous effects on absence: 22 On one hand, dependants increase the financial pressures to attend work; on the other, the presence of dependants creates situations where absence is difficult to avoid (e.g. if a child is sick).47

Since 1983 Australia has indicated intention to ratify ILO Convention 156 which concerns equal opportunities and equal treatment for men and women workers with family responsibilities. The Convention promotes the development of community services such as child care and family services and facilities, and the concept of special types of leave for parents to deal with family responsibilities. On 2 March 1990 the Prime Minister reaffirmed this commitment.

In terms of the leave provisions sought by the Convention, the APS could be described as generally in advance of private industry in Australia. Measures such as parental leave of up to 66 weeks in the APS, up to three days special leave which can be used for family illnesses or crises, flexitime and permanent part-time work have benefited public servants with family responsibilities. Criticisms have centred on limitations to these benefits, especially the limited availability of permanent part-time work.

More flexible negotiated standard working day arrangements could benefit working parents and have the effect of reducing absenteeism. This would be in accord with the Structural Efficiency Principle measures suggested by the Industrial Relations Commission. 48 Countries with more flexible arrangement of working hours include Sweden where parents of children under eight years may reduce their working hours from eight to six per day with a corresponding reduction of income. 49

The Australian Council of Trade Unions (ACTU) has prepared a national test case on parental leave and special family leave which should be heard by the Commission this year. The claim is for up to 52 weeks unpaid leave for fathers after the birth of a child, with up to 3 weeks of the leave available immediately after the birth and the remainder available at the employee's choice within two years of the birth. The claim would extend the options of both mothers and fathers in the labour force to take their extended parental leave at a time of their choice up to the child's second birthday. Optional part-time leave could also be taken by agreement between the employee and employer.

The claim for special family leave seeks up to 5 days unpaid leave available to both parents to look after a sick child or to meet a child's school requirements such as pupil-free days or attendance at school functions. The leave sought would be in addition to the existing paid leave entitlements. 50 23 In Australia, government programs have increased the number of federally funded child care places to 114,400 (at 30 June 1989) and a government program to encourage work-based child care is now under way. So far employer response to the employer-provided child care proposals has been slow. Overseas evidence points to savings in labour-related costs, especially in reduced absenteeism and reduced labour turnover, from the provision of on-site or local child care. 51 The Government's objective on work-based child care, as stated in the March 1990 Policy Speech, is to provide the incentive for employers to extend child care in both the public and the private sectors.

Conclusion:

That departments should extend provision for permanent part-time work and flexible 'standard days' and have regard to their obligations to workers with family responsibilities. Progress in the ACTU test case on parental leave and special family leave should be monitored closely and costs and feasibility of increased access to unpaid leave should be investigated. 24 FACTORS AFFECTING MOTIVATION TO ATTEND

The Steers and Rhodes model of absence identifies pressures to attend work which are influenced by economic and market conditions, incentive and reward systems, work group norms, personal work ethic and organisational commitment. Attendance motivation, according to Steers and Rhodes is primarily dependent on job satisfaction. 2 All of these factors warrant consideration in any exercise on reduction of absenteeism in the public service.

(a) Economic

Steers and Rhodes found a steady decline in absence rates in the US between 1979 and 1982 attributable to the increase in unemployment over the same period. This thesis is supported by the work of Kenyon and Dawkins in Australia who found that when firms are hiring, the probability of the imposition of severe penalties, especially job loss, is lower and workers will be more likely to be absent. Conversely when firms are firing employees, absenteeism decreases. This finding has implications for the Australian Public Service where security of tenure provides an environment in which voluntary absence is unlikely to be penalised by job loss. Wooden (1989) and others identify job security as one of the factors that may lead to greater absenteeism in the public sector. 53

Kenyon and Dawkins (1987) found strong support for the hypothesis that labour absence responds to economic variables. They found that an increase in an hour of overtime per employee could be expected to reduce absences markedly. Similarly they found that a one hour reduction in standard hours could be expected to reduce labour absence due to illness and injury.54

Kenyon and Dawkins contend that labour absence will differ between high wage - low monitoring co-operative work environments and low wage - high monitoring coercive environments. They quote a 'competing incentives hypothesis', attributed to Drago and perlman55 , that labour markets are likely to segment according to incentive structures: a firm will choose either to pay low wages and to monitor its workers closely, 2E to pay high wages and not monitor closely. Firms operating in the high wage - low monitoring sector will wish to preserve trust and avoid perfunctory compliance.

Kenyon and Dawkins concluded that 'occupation does affect labour absence'. Specifically their studies indicated that:

tradesmen and women and production and process workers, that is, blue collar workers, are more prone to labour absence than other workers. As well as being more dangerous, these occupations are, on average, relatively low paid and often involve relatively difficult working conditions. It might also be the case that they involve a more coercive work environment. 56 25 In another work (Wooden with Dawkins and Kenyon, 1987) the point is made that the work attendance decision is influenced by numerous other factors including personnel and compensation practices and external labour market conditions.

(b) Job Satisfaction

As can be seen from the above, Kenyon and Dawkins (1987) find no conflict between the approach of psychologists and personnel researchers in stressing the importance of job satisfaction variables in explaining labour absence, and the approach of labour economists in stressing opportunity costs:

The key problem for the firm is how to obtain consummate co-operation, and avoid perfunctory compliance. Obviously absenteeism is a symptom of perfunctory compliance. 57

Disagreement exists in the research studies on the importance of job satisfaction variables in determining the extent of absenteeism. In a 1976 study an English Occupational Psychology Research team concluded that the popular job-dissatisfaction theory of absenteeism, was 'naive, narrow and empirically insupportable,.58 Keller (1983) also tested a number of variables including prior absenteeism, job attitudes, demographic and personality variables and found that job satisfaction, job level and age were not predictors of absenteeism. Rather, 'prior absenteeism, group cohesiveness and an internal health locus of control accounted for unique variance in absenteeism,.59

Researchers at the National Institute of Labour Studies at Flinders University (Mark Wooden with Peter Dawkins and Peter Kenyon) have considered the studies on job satisfaction and have concluded that the Steers and Rhodes job satisfaction theories are valid and that absenteeism in general is significantly correlated with job satisfaction factors. The relationship, they suggest, is stronger for absence frequency than for absence duration and is strongest with satisfaction with work. It may however be appropriate to view organisational cOmmitment also as a variable which both creates pressure to attend work and a desire to attend work. 60

As identified by Steers and Rhodes, the seven aspects of work which are most likely to lead to job satisfaction are:

(1) Increases in job scope or challenge (task identity, autonomy, variety, level of responsibility, participation in decisions, sense of achievement, enrichment).

(2) Job level - people with more challenging, higher level jobs are more satisfied and less likely to be absent than are workers with lower level positions.

(3) Low role (job) stress. 26 (4) Work group size - generally a positive relationship seemed to exist between increases in work group size and absenteeism as a result of decreased group cohesiveness, greater specialisation in, and therefore less interesting, tasks and poorer communication.

(5) Considerate, democratic style of leader.

(6) Positive co-worker relations.

(7) Opportunities for advancement.

According to Steers and Rhodes, the relationship between job situation variables and subsequent (resulting) job satisfaction is moderated by individual values and job expectations which in turn are shaped by personal characteristics such as age, sex, education, ethnicity, socio-economic background, and training for and expectations of the position. .

If, as is thought, these aspects of job satisfaction increase the motivation to attend work, a great deal of scope now exists for reducing absenteeism by means of individual development plans, training opportunities, industrial democracy and participation in decision making, and through performance contracts and appraisal. It has been noted earlier in the paper that change and restructuring have already caused stress within some sections of the public service and therefore more emphasis must be given to positive relationships and involvement. Job satisfaction is dependent to a large extent on the encouragement by management of positive work attitudes, including those in relation to attendance.

Conclusions:

That employees should be consulted and involved in developing programs and strategies to provide greater job satisfaction, improved productivity and reduced absenteeism.

That care should be taken in the development of these programs to ensure that the majority of employees who do not abuse sick leave entitlements do not become disaffected or feel threatened with the removal of the existing 'safety net' of sick leave provisions.

That use of leave, including sick leave and special leave, should form a part of performance appraisal and individual development programs, and that individual records on performance should include a more detailed section on attendance, including number of days and type of leave, and use of flextime. 27 (cl Work norms / personal work ethic Many researchers have assumed a causal link between absenteeism and the availability of 'generous' paid sick leave in the Australian Public Service. The comments of Mark Wooden, Senior Research Fellow of the National Institute of Labour Studies have already been noted6l . Increasingly the suggestion is that it is the availability of paid sick leave which in some cases causes it to be taken. Paid sick leave is seen as the rewarding of absence, including voluntary absence, and this perception has given rise in many places to a culture of 'sickie taking'. Sick leave is regarded in some work places as an entitlement which will be lost if it is not taken, and becomes the norm, i.e. everyone else does it. A U.S. study on teacher absenteeism asserts:

The fact that absenteeism increases with the number of sick-leave days and with sick-leave pay is one of the few empirical findings with respect to sick leave policy reported in the literature. 62

In their study 'Sick Pay Vs Well Pay: An Analysis of the Impact of Rewarding Employees for Being on the Job', Harvey et al report empirical evidence which suggests that organisations with paid sick leave programs experience almost twice the absenteeism of organisations without these programs. Or Chris Baker of Work Health comments that part of the problem is the institutionalised approach to work attendance and that one of the failings is that

Under the award you are entitled to take 12 days' sick leave a year, and my experience is that it is a peculiarly Australian phenomenon that the majority of workers do take their 12 days whether they are sick or not. 63

A Victorian study of absenteeism in local government also appears to substantiate this view:

It is ... noteworthy that of the six municipalities listed only one allows sick leave in excess of the award provisions. This municipality allows 16 days and has the highest absente~sm experience of those listed with an average of 14.1 days per employee. 64

This study concluded that:

on the limited evidence available one must gravitate towards the belief that employee attitude is a most significant factor.

Steers and Rhodes (1984) and other researchers point to the importance of work group norms as an influence on absenteeism. Cohesive motivated work groups are contrasted with work areas which have an 'absence culture', defined here as a set of shared understandings about absence legitimacy and established customs and practices of employee absence behaviour. 28 Personal factors, and the value systems of individual workers, are also important. A strong personal work ethic has been found to lead to good attendance, regardless of job satisfaction and other variables. Similarly the respective values which individuals place on work and outside activities (leisure or duty) may affect attendance patterns:

Attendance patterns may reflect an attempt to balance the quantit¥ and quality of time spent in various endeavours. 5

When leisure activities become more important to individuals than work, and when there are competing time demands, more frequent absences may be expected. Dr Chris Baker has commented:

Absence as a whole is increasing in the Western world it has been since the 1950s - and the reason for that is that we have this disposable income and want to have time to spend that money. People before had to work to pay the rent, or buy a house or pay for food, but now they have discretion over how to spend their money. You could argue tha~ their work ethic is lower. 66

Conclusions: As for last section, and that fair comment on an employee's attendance and leave record should be a requirement in all documentation such as references and reports.

(d) Industrial disputes

An estimated 5.5% of temporary non-approved work absence in Australia results from industrial disputation67 . Again this is a form of absenteeism which has implications for management, but this type of labour absence is outside the scope of this paper. 29 AGE VARIABLES

Most studies report the finding that younger workers are more prone to absenteeism than older workers. The reasons given are that younger workers tend to change jobs more frequently, they may be less committed to their jobs or firms, and they tend to be less experienced and more accident prone. Additionally, the opportunity cost of forgone leisure is likely to be higher for younger workers than for older workers. 58

Wooden and Robertson report that although illness incidence increases with age, the incidence of absence that results from that illness does not. 59 However, as the 1972-73 Survey of Sick Leave in the APS also showed, when older workers do take sick leave it is likely to be certificated leave of longer duration.

In seeking to identify 'absenteeism' or voluntary absence taken on paid sick leave, many studies concentrate on uncertificated leave. Indeed in seeking to establish patterns of absenteeism research studies have 'corrected out' long term certificated sick leave, and thus the practice of using up sick leave credits before retirement is often overlooked. 70 An example of this methodology is a study of sickness absence in the Antarctic Division of the Department of Science in 1984 and 1985. This report states:

However, a small number of individuals did take substantial periods of sick leave - in some cases in excess of 100 working days in a given year. In order to assess trends in the majority of the workforce, figures were re-calculated after excluding nine individuals whose leave during a single year exceeded 25 days. Not surprisingly average figures were substantially lower in the groups affected by the deletions (most notably, the oldest age groups).71

A study of former employees who were retired early as part of an 'enlivening' exercise for departments could shed light on many age/job satisfaction/ incentive theories of absence.

One of the terms of reference for the Survey of Sick Leave in the APS in 1972-73 was to discover:

To what extent do officers avail of sick leave immediately prior to retirement?

Unfortunately the Public Service Board reported that because of difficulties involved in obtaining reliable data from the sample, it was not possible to satisfy this objective. Included in the recommended new collection of data on sick leave usage in the APS should be statistics on pre-retirement sick leave. 30 The 1972-73 survey did show a steady increase in leave taken with age for men over 39 years, rising from five days for the under 18 age group to over ten days for the 60 and over age group. For women the average stayed close to ten days for all age groups. In looking at sick leave taken by completed years of service, a marked increase was shown in leave taken by men after 30 years of service. Certificated leave increased after 20 years of service. This could occur because older workers are more susceptible to illness, as Wooden and other researchers suggest72 but it could also reflect the using up of sick leave credits before retirement. Strangely, women with 30 years or more of completed service had the lowest average sick leave of any group of women. However perhaps in 1972-73 the number of women in the public service with over 30 years of service would not provide a statistically valid base.

An informal survey73 undertaken with the co-operation of the Personnel Practices Contact Group in Canberra, revealed that in 14 Departments approximately 40% of age retirees in 1989 had taken in excess of 30 days sick leave in the three years preceding retirement; 68.9% retired with less than 9 weeks full pay sick leave credits remaining, and 20% had no full-pay credits left on retirement. On the other hand, 22.2% of age retirees in 1989 left with more than 20 weeks in accrued unused sick leave.

Although insufficient data was provided by this survey to enable statistically valid conclusions, the impressions given reinforce the anecdotal evidence from Personnel Officers that the practice of 'using up' sick leave before retirement is still common. This is despite the tightening up of provisions on extended sick leave and the requirement of early review by the Commonwealth Medical Officer. It may be that the new restrictions on the taking of invalidity pensions could have the effect, over time, of a greater incentive for younger officers to 'use up' more of their accrued sick leave. Payment or part-payment of accrued leave on retirement could offset the new invalidity measures, and could provide the incentive for attendance rather than for absence.

Conclusion:

That a scheme such as payment of 20 - 25 % of unused sick leave within the APS should be initiated for a trial period in terms of a SEP restructuring exercise. 31 INCENTIVE SCHEMES/ABSENCE CONTROLS (a) Carrots, sticks or good management?

Researchers report that schemes requiring proof of illness for all absences have not impacted significantly on absence levels. 74 Employees probably just substitute certificated for non certificated leave, taking perhaps fewer but longer absences. An article on the 'sickie mentality' quotes Dr Chris Baker of Work Health on this point:

We all know that it is easy to find a doctor who, if asked, will give a certificate for anything if it is a short term absence of one or two days. A manager would be far better off not asking for it in the first place. 75

Steers and Rhodes (1978) concluded that more effective results may be achieved through positive reward systems than through 'punishment', although a number of case studies had shown some absence control systems based on a combination of rewards and punishments were quite successful.

The acknowledgement that voluntary absenteeism exists and is costly has led to attempts to vary employee fringe benefits so as to provide motivation or incentives for attendance while not removing the safety net of sick leave entitlements for cases of accident and genuine illness. Incentive schemes have included bonus pay, bonus points, lottery tickets and, increasingly, payment or part-payment of unused accumulated sick leave credits.

A 1985 U.K. survey showed that medium sized companies tend to favour attendance bonus schemes, but that their value or effectiveness remains in dispute. A study of absenteeism within local government in Australia concluded that:

A comparison of the incentives offered by individual municipalities with absenteeism records would suggest that the incentives are seen as an employment condition by outdoor employees and have either no effect or very little bearing on levels of absenteeism. 76

Many firms have reported greater success through monitoring schemes which give greater responsibility for attendance to immediate supervisors. In the opinion of the manager of administration at BHP, Alan priestly, the best way of controlling absenteeism is on an individual basis:

... at BHP we don't use direct incentives, unlike other companies with attendance bonuses. The research suggests that although this may be successful in the short term, in the longer term it makes little difference. The way to reduce absenteeism is to manage it; if you are talking about work performance, motivation, work attendance, work environment, you need to manage it on an individual basis. 32 Another commentator, Dr Chris Baker, thinks that controlling days off should be an internal matter between management and employees, and says that the best results occur when responsibility is delegated down the line to supervisory levels: ideally supervisors should be responsible for five to ten employees to develop proper relationships. Employee involvement is also seen as an important motivating factor or incentive. The Ford Company, for example, reported success in involving employees in discussions of ways of doing the job better. 77

Increasingly industry awards are incorporating provisions for payment or part-payment of unused accrued sick leave on retirement, or at other times. Some schemes, for example, provide for the payment of sick leave entitlements accrued beyond the number of days allowed for a year, to be paid at the time of the employee's annual leave. Awards which incorporate provisions for payment of unused sick leave credits include meat workers' awards, waterside workers' awards, some mining awards, some local government awards and others. As yet the only such provision for federal government employees is the OTC award.

No formal studies appear to have been done on the effectiveness of payment or part payment of accumulated sick leave in reducing absenteeism. A personnel officer in Western Mining, which provides a full pay-out of unused sick leave upon resignation from the company to some categories of operations and mining employees, commented that the scheme was costly and there seemed to be large payouts for unused leave when employees left. This indicated, he thought, that 'sickies' were not being taken and so meant greater efficiency for the company in loading and other operations formerly adversely affected by non-attendance.

Provision of pay-out of unused sick leave is very common in both State and Federal Meat Industry awards. Often the full . entitlement is paid at the end of the year and then the employee may take leave without pay if no leave is then available to cover the period of illness. Some awards make provision for accrual of 10 days and the pay-out of accrued leave over that amount. A meat industry spokesman thought that the provision had no effect when the person valued the time off more, but that it probably did away with the concept of 'using up' leave before it is 10st78

Waterside workers won the right in 1972 to be paid 50% of the balance of accrued unused sick leave. The entitlement before that was for 7 days of paid sick leave and it was the custom to take the whole 7 days. In 1974 this was extended to 100% payment of accrued unused sick leave. In July of each year, 10 days paid sick leave entitlement is credited to each worker. At that time they can elect to cash in the balance of unused sick leave credits above 28 days. The benefit of the scheme to the Association of Employers of Waterside Labour is that it has cut down on the number of employees 'failing to report' which was a big problem with the rigid manning scales which apply on the waterfront. 79 { , 33 Conclusion: That the growing practice of payment or part payment of unused sick leave credits in industry should be monitored.

(b) OTC In December 1987 an Agreement between the Professional Radio and Electronics Institute of Australasia and the Overseas Telecommunications Commission (OTC), in the context of negotiations within the national wage second tier principles, was ratified by Commissioner Griffin in the Industrial Relations Commission. The Agreement included the provision of sick leave accrual at the rate of three weeks leave on full pay each year, and the entitlement of a lump sum payment equal to 20% of the monetary value of the accumulated sick leave credits for any staff member with at least five years service with OTC who leaves employment with OTC other than by dismissal. The Commissioner's duty was not to approve each item in the Agreement but to determine whether the agreed package as a whole met the criteria set out in the restructuring and efficiency principle. The Commissioner made it clear that the pay-out of any untaken entitlement of sick leave should not become a part of the award:

It should be clear therefore that this item could not be regarded as an award matter or a matter which the commission would be prepared to endorse for inclusion by consent in an award. In this case it is one item of an agreed package resulting from negotiations designed to secure a 4 per cent increase based on genuine and satisfactory offsets.

No formal study has yet been undertaken on the effects of the 20% pay-out provision on the absenteeism rates of OTC employees. However, if a reduction in absenteeism has been achieved, as seems likely at least in the short term, this is a provision which the APS could well consider. Potentially such a provision could result in a significant reduction in pre-retirement sick leave, and perhaps it may also have the effect of reducing or providing some' disincentive for some invalidity retirement bids.

Conclusion: That the Overseas Telecommunications Commission be asked to provide data on the use of sick leave before and after the introduction of the 20% entitlement to accumulated sick leave on retirement. 34 ·c (c) Case Studies of Incentive/Absence Control Schemes Overseas:

Harvey et al report one successful U.S. well-pay scheme which sought to substitute a scheme of bonus payments for full attendance for the previous sick leave scheme. A bonus of four hours pay was made each month to employees who were not sick for two consecutive pay periods (four weeks). The former scheme of provision and accrual of sick leave was discontinued. The first eight hours of illness absence was unpaid, but illness absence after that was on full-pay for up to two months at which point a disability plan came into operation. In the first full year of the program (the 1981 fiscal year) absenteeism decreased by 46% and there was a 55% reduction in the amount of sick leave paid. At the end of the trial, 64.3% of employees voted to continue with the well-pay program and 14.3% wanted to return to the former sick leave provisions (leaving 21.4% with no opinion or no answer). Supervisors reported that less time needed to be spent in counselling or reprimanding employees, and less time was required in organising to cover absences. One negative finding was that although the incidence of sick leave dropped dramatically, the duration of the sick leave increased by 108% (from an average of 9.6 to 20 hours) probably to minimise the loss of the first eight hours pay as much as possible.

Other U.S. research has centred on schemes to reduce teacher absenteeism. One study concluded that absenteeism is attributable in part to illness and in part to abuse of sick leave privileges by healthy employees. Sick leave data and sick leave policies from California and from Wisconsin were compared. The study found that payment for unused sick leave could be expected to result in fewer days of absenteeism.

The pay may be explicit, such as $10 for each unused sick leave day, paid at the end of the year, or the teacher may be allowed to accumulate sick-leave days and apply them to early retirement. 80

In the Edmonds School District of Washington State, pay incentive schemes for teachers are in operation and have been found to be effective in reducing absenteeism and thus in reducing the costs of relief teaching provision. Twelve days of annual leave is provided for illness, injury or personal emergency. Of this, up to two days may be taken in any school year for personal emergencies, and up to 3 days in any school year for immediate family illness. A doctor's certificate may be required for personal illness or disability absence of 5 or more consecutive days. Unused portions of this leave accumulate from year to year to a maximum of 180 days. Upon retirement, compensation for 25% of the salary entitlement for the unused sick leave days is paid. This amount, 25%, is considered effective in discouraging absenteeism, but does not result in people reporting for work when genuinely ill. 35 Another teacher incentive scheme is reported at Case Study (b), Appendix 4. This involved the payment at the end of the year of an unknown amount of bonus for each day fewer than seven (the average) that teachers were absent, and resulted in improved attendance even though absenteeism had not been thought a problem. The stUdy indicated the initial success, at least, of such incentive schemes but gave no indication of whether this effect could be maintained.

Australia:

In Australia the problem of absenteeism has also been recognised and attempts have been made to combat the problem. A survey of a number of Australian organisations and businesses81 has revealed the development of different types of policies and programs to improve attendance. A number reported increased morale and reduced absenteeism where work units were not too large or impersonal and where line managers monitored attendance. One comment in a business organised in this way, but with no flextime or rostered day off provisions was:

A bigge~ problem is to get people to stay away when they are ill: they tend to think of the extra work they are causing others. 82

Other organisations combined techniques of close monitoring of sick leave with the incentives of overtime or weekend work. In one example of a 'carrot and stick' approach, a black list was kept of people who had taken excessive leave and these then had to provide a certificate for all leave until they were off the black list. Weekend work was not available to those who had taken sick leave in the previous week. 83

In an article on managing poor performance, Dawn Linklater contras,ts the effectiveness of the ' carrot' and ' stick' approaches in looking at the results achieved respectively by the State Rail Authority of N.S.W. and the Department of Motor Transport in their programs to reduce absenteeism. The SRA achieved an 8% reduction in total sick leave as a result of new rules requiring medical certificates for all sick leave taken adjacent to a weekend, public holiday, recreation leave or any break. Thus everyone was penalised, regardless of whether they had abused the system in the past or not. The DMT on the other hand removed the limit of three uncertificated absences per annum, introduced accrual of untaken sick leave (which had previously not applied to staff with less than 10 years service) and instituted a system of interviews and counselling for any employees who took leave on six occasions during the year, regardless of the number of days of the leave. With the new system, a reduction of 28% in total sick leave was achieved. 84

The experience of the Brisbane City Council (BCC) is discussed in an article by Rhonda Dredge and Peter Milton entitled 'In sickness and in health: The absenteeism dilemma'. Absence monitoring was i~roduced with the adoption of flextime in 36 .,

1973-74 in some white collar areas. More sections were successively monitored, with blue collar areas being included from 1977-78. Two major impacts on absence behaviour were seen in the BCC. Very significant reductions in overall absenteeism occurred immediately after the implementation of flextime and again after an Absence Control Program was introduced for Brisbane City Council employees in 1978.

The absence control program was based on a pattern analysis technique which provides for supervisors and employees a visual report on absence. Supervisors were encouraged to consider a range of intervention options in dealing with adverse absence patterns. These included appropriate counselling and redesign of the job where boredom or dissatisfaction was a problem.

The graph below illustrates the drop in absence rates with the introduction of flextime and pattern analysis. 8S The rise in 1977-78 is largely explained by the inclusion of blue collar workers into the monitoring.

?crccnt3~C: 01 197Jrate 1001------j--- fle:uime introduced ) .9°1 '0 j ;01 Y II j I I I i i I i 1972 1973 197:t i97S 1976 1977 1978 1979 19::l0 1981

Absenteeism In monitored areas. Brisbane CUy Council.

Conclusions drawn by the authors included the need for training supervisors in counselling techniques and the idea that

absence counselling was thought to be effective when related to the annual salary review by Departmental Heads, who scrutinised attendance before approving pay increases. 37 The present system86 is that twelve days sick leave on full pay each year accumulates to a total not exceeding 260 days. If the period of sick leave does not exceed 3 working days, the Town Clerk may 'dispense with the medical certificate'. Upon termination of employment for. any cause other than misconduct justifying summary dismissal, accumulated sick leave credits are paid on the following basis:

For service of less than 5 years - nil For unbroken service of 5-10 years - 25% of accumulation For " " of 10-15 years - 50% of accumulation For " " of 15-20 years - 75% of accumulation For " " of 20 years or more - 100% of " However, as most of the employees of the BCC have been employed for less than 6 years, and as the sick leave balance is paid only on retirement, there is little visible incentive from this system of payment of accrued leave. A greater incentive appears to result from the 9-day fortnight system with working days of 8 hours 27 minutes instead of 7 hour 36 minutes. An employee who misses work is counted absent for 8 hour, 27 minutes which is more than one day of the 12 per year allowed. No formal studies have been made of the effectiveness of these most recent provisions.

Effectiveness of absence control programs

Wooden and Robertson argue that any or all of the following factors could result in the 'dominance of public sector industries amongst the most absence prone industries':

( i) lower job satisfaction ( H) more generous sick leave entitlements ( Hi) greater job security ( iv) less pressure placed on workers to attend in the public sector (v) the greater level of "slack" built into public sector jobs.

Whether or not this is the case· in the Australian Public Service, all of the factors except the second can be addressed by good management practices.

The above examples and case studies show that good results (i.e. lower absenteeism) have occurred where immediate supervisors take an active role in the monitoring of and counselling on absenteeism, where there is worker participation in decision making, and where work norms and work ethics stress co-operation, commitment and responsibility. The benefits of flexible working arrangements have been demonstrated. Extending the availability of unpaid leave to workers with family responsibilities could also improve morale and reduce unauthorised absence. Good record keeping by supervisors, even to the extent of graphs and charts on display, the tying of 'rewards' such as overtime to good attendance, and the payment or part-payment of accrued sick leave on retirement or at agreed intervals have all been demonstrated as effective absence-control measures, at least in the short term. 38 " Conclusion: That the role of immediate supervisors in monitoring and counselling in matters of attendance should be strengthened and that supervisors should receive training for this role. 39

Awards with Provisions for Payment of Unused Sick Leave Awards which incorporate provision for payment of unused sick leave include:

Administrative Clerks' (Container Terminals and Depots) (Consolidated) Award 1988 Cl 22 (h) ...where an employee has accumulated at 1 July in any year an unused sick leave entitlement in excess of twenty days he may elect, prior to 31 July in that year, to receive his ordinary rate of pay ... for all or part of such excess in lieu of the actual time. [03/06/89]

Aerated Waters Industry Award 1981 Cl 18 (g) (ii) ...the employer shall pay the employee the value of any untaken accumulated sick leave which accrued on or after 4 December, 1980, together with the value up to a maximum of 80 hours of any untaken accumulated sick leave which accrued prior to 4 December, 1980. (Note: Accumulated sick leave does not include sick leave for the current year of service). [09/10/89]

Austral-Pacific Fertilizers Ltd (Agricultural Chemical Industry) Award 1987 Cl 21 (g) In the event of death, retirement, or retrenchment (in special circumstances) of an employee, all accumulated credited sick leave shall be paid to the employee or the employee's dependant, as the case may be. [03/01/90]

Clerks (Shipping) Award 1982 Part III and Part IV Cl 11 (d) An employee may elect, prior to 31 July in any year, where he has an accumulated sick leave entitlement at 1 July of that year in excess of 28 days, to receive the money value of all or part of such excess in lieu of actual leave. [12/02/88]

Consolidated Wool Dumping Ltd- FCU Agreement, 1980 Cl 17 (a) ...Provided that for any such sick leave accumulated on or after 1 July 1980 the employee (or his legal representative, in the case of death) shall be paid his ordinary rate of pay prescribed by the agreement, in respect of any balance of accumulated sick leave entitlements. Where at 1 July in any year he has an accumulated sick leave entitlement in excess of 28 days a clerk may elect to receive the money value of all or part of such excess in lieu of actual leave. [12/02/88] 40

Carlton and United Breweries (NSW) Pty Ltd Professional Scientists Agreement 1986 Cl 9 (iii) Cumulative sick leave - paid sick leave shall accumulate indefinitely, provided that an employee who has accrued at least 18 days' sick leave may, on the anniversary of his employment each year, elect to be paid the value of sick leave credit in excess of eighteen days, up to a maximum of nine sick days, which shall be deducted from the employee's sick leave accumulation. A day shall mean 7.78 hours. [15/02/88]

Federal Meat Industry Award 1981 Cl 10 (d) Any employer may, by agreement with any employee, pay such employee for the portion of sick leave so accrued; or, should the employee accrue in excess of 128 hours' sick leave, that additional accrual shall be paid to the employee at the expiration of each twelve completed months ... (e) Should an employee being eligible for sick leave, leave his employment for any reason, or be dismissed for any cause whatsoever, he shall be paid for all sick leave that has been accumulating on his behalf up to a maximum of 128 hours .... [28/08/89]

F.J. Walker Ltd, Canberra Division Agreement Award Cl 30 (i) In lieu of paying sick leave in accordance with the foregoing provisions of this clause, an employer may give such employee ten days' holiday, on full pay to be added to his period of annual leave, or may pay him in lieu thereof, ten days additional full pay at the time the employee commences his period of annual leave; provided that the payment for such leave may be made , if the employee so elects during the year as occasions direct ... [15/02/88]

Foremen Stevedores' Award 1986 Cl 32 (a) (iv) Where a casual or pool Foreman has accumulated at 1 July of any year an unused. sick leave entitlement in excess of 28 days, he may elect, prior to 31 July in that year to receive his ordinary rate of pay prescribed by this Award for all or part of such excess in lieu of actual leave. [9/10/89]

Footwear - Manufacturing and Component - Industries Award 1979 Cl 27 (c) (i) ... shall be paid the unused sick leave (but not more than 182.4 hours) at the award rate of pay. [05/09/89] 41 Gas Industry (Contractors- Mains and Services) Award 1987 Cl 26 (3) .. , condition compensable under the Workers' Compensation Act, shall be paid the amount of wages equivalent to the balance of sick leave on full pay standing to his credit at the date of his retirement, provided that the balance of sick leave paid shall not exceed in ordinary time the period between actual retirement and normal due date for retirement under normal employer policies. [26/07/88]

Glass Merchants and Glazing Contractors (South Australia) (Consolidated) Award 1984 Cl 29 ... an equivalent payment shall be made to the employee concerned at the time of taking his annual leave, (including leave allowed before due date) which shall be sufficient discharge of the employer's liability to the employee for sick leave payment for such period. Provided that if an employee under the provisions of this clause is entitled to ten days paid sick leave in a year of service, no payment for sick leave not taken shall be made in respect of the 7th, 8th, 9th and 10th days. [29/08/89]

Glass Merchants and Glazing Contractors (Victoria) Consolidated Award 1988 Cl 29 As for South Australia, above. [29/08/89]

Holco Ltd Meat Preservations etc Award 1985 Cl 16 (c) An employer may by agreement with any employees grant such employees up to eight days holiday on full pay in lieu of payment for absence through sickness or, if such additional holiday cannot be granted, give up to eight days' pay in lieu thereof. [15/02/88] Miscellaneous Workers' (The Port Waratah Stevedoring Co Pty Ltd) Watchmen and Gamekeepers Award 1982 Cl (b) •.. of death his legal personal representative shall be paid 100% of his untaken sick leave. (g) Where an employee has accumulated at 1 July of any year an unused sick leave entitlement in excess of 28 days, he may elect, prior to 31 July in that year, to receive his ordinary rate of pay •.. for all or part of such excess in lieu of actual leave. [17/02/88]

Northern Territory Meat Processing Award 1984 Cl 15 (c) An employer may by agreement with any employee grant such employee eight days holiday on full pay in lieu of payment for absence through sickness or, if such additional holiday cannot be granted, give eight days' pay in lieu thereof. Provided that, for a period of service less than one year pro rata payment shall be made for each completed month of service or part thereof. [01/09/89] 42 " Operational Clerks' (Container Terminals and Depots) Award 1982 Cl 22 (d) .,. where an employee has accumulated at 1 July of any year an unused sick leave entitlement in excess of 28 days, he may elect, prior to 31 July in that year to receive his ordinary rate of pay ... for all or part of such excess in lieu of the actual leave. [14/10/89]

Storemen and Packers (Container Depots) Award 1982 Cl 21 (d) As for Operational Clerks' Award above. [14/10/89] Storemen and Packers' Fibre Processing Industry Award 1982 Cl 18 (d) On retirement on account of age or infirmity an employee shall be paid for all sick leave that has accumulated on his behalf. The rate of such payment shall be the hourly rate based on the average weekly earnings earned ... [26/09/89]

Shipping Clerks Award 1988 Cl 27 (d) As for Operational Clerks' Award above. [28/05/89]

Waterside Workers Award 1983 Cl 36 (g) Where an employee retires, is de-registered on redundancy or voluntarily leaves the industry after ten years' service, or dies or leaves the industry under circumstances where he has been accepted by the Stevedoring Employee's Retirement Fund as "totally and permanently disabled" he shall be paid by AEWL (or in the case of death his legal personal representative shall be paid) at the rate prescribed in this clause for any balance of accumulated sick leave entitlement of which the employee has not availed himself. (k) Where an employee has accumulated at 1 July of any year an unused sick leave entitlement in excess of twenty-eight days, he may elect, prior to 31 July in that year to receive payment from AEWL at the rate prescribed in this clause for all or part of such excess in lieu of actual leave. Cl 55 (g) and (i) make similar provisions. [26/09/89]

Waterside Workers' (Container Terminals) Award 1984 Cl (b) and (g) contain provisions similar to those of the Waterside Workers Award 36 (g) and (k) and 55 (g) and (i) above. [14/10/89] 43 Appendix 1

Excerpt from National Wage Case Decision August 1989 on the Structural Efficiency Principle.

It will be recalled that in the August 1988 decision the Commission said that

"The measures to be considered should include but not be limited to:

establishing skill-related career paths which provide an incentive for workers to continue to participate in skill formation;

eliminating impediments to multiskilling and broadening the range of tasks which a worker may be required to perform; and

ensuring that working patterns and arrangements enhance flexibility and the efficiency of the industry. "

In relation to the last measure in particular we are of the view that many awards have scope for a less prescriptive approach and, without limiting the opportunities for innovation, the following are some of the measures which are appropriate for consideration:

averaging penalty rates and expressing them as flat amounts;

compensating overtime with time off;

flexibility in the arrangement of hours of work, for example:

wider daily span of ordinary hours shift work, including 12 hour shifts ordinary hours to be worked on any day of the week job sharing;

introducing greater flexibility in the taking of annual leave by agreement between employer and employee;

rationalising the taking of annual leave to maximise production;

reviewing the incidence of, and terms and conditions for, part-time employment and casual employment;

reducing options for payment of wages other than by electronic funds transfec; extending options as to the period for which wages must be paid to include fortnightly and monthly payment; 44 changes in manning consistent with improved work methods and the application of new technology and changes in award provisions which restrict the right of employers to manage their own business unless they are seeking from the employees something which is unjust or unreasonable; reviewing sick leave provisions with the aim of avoiding misuse; and developing appropriate consultative procedures to deal with the day to day matters of concern to employers and workers 45 Appendix 2

North American Survey and Anecdotal Evidence on the Benefits of Employer Provided Child Care, 1989.

Weber and Tulloss (1979) estimated that reduced absenteeism would account for between 8 and 11 per cent of total savings in labour-related costs. Savings from reduced labour turnover would be equivalent to between 26 and 27 per cent of the total operating costs of the centre depending on the type of child care and the extent of labour turnover for other reasons.

Perry (1981) surveyed 305 companies which were providing some form of employer-sponsored child care and found that half of them experienced significant reductions in absenteeism, while over 40 per cent had experienced lower labour turnover. .

Business Week (1981) cites the experience of Intermedics, a Texas manufacturer of medical equipment. Seventy-five per cent of the company's employees are female. Intermedics reported that absenteeism fell by 15 000 hours (i.e., equivalent to 2 per cent of total person-hours) in the first year of providing child care, and that labour turnover fell by 23 per cent in the first year and a further 37 per cent in the second year.

Burud, Aschbacher and McCroskey (1984) provide more information on the Intermedics experience. The labour turnover rate for employees using the child care centre is one-sixth the rate for the rest of Intermedics workforce, Burud et al. also cite the case of Neuville-Mobil Sox, a small hosiery manufacturer (87 employees) which reported that its labour turnover savings alone covered the cost of providing on-site child care. The same company also reported an absentee rate of 1 per cent in a locality averaging 5 to 10 per cent.

Alisberg (1984) cites a survey of 58 companies which provided some form of employer-sponsored child care. Aggregate absenteeism fell by 72 per cent and labour,turnover by 57 per cent after child care provisions were initiated. Alisberg also cites the case of Control Data Corporation, a major computer manufacturer, which found that the absenteeism rate for employees participating in its child care program was 25 per cent lower than the rate for parent-employees not participating in the program.

Mann (1984) cites the experience of a small textile manufacturer. This company reported a fall in its absentee rate to 1 per cent, down from 10 per cent, and a labour turnover of 7 per cent, down from 40 per cent, within 12 months of providing child care to its employees. 46 Alisberg, Barbara and Rose, Karol (1985) The Employer's Guide to Child Care: Developing Programs for Working Parents, Praeger, New York.

Burud, S. L., Aschbacher, P. R., and McCroskey, J. (1984) Employer Supported Child Care: Investing in Human Resources, Auburn House, Boston, Mass.

Business Week (1981) "Child Care Grows as a Benefit", December 1981, USA.

Mann, J. (1984) "Child Care - Public Policy Report" Young Children, Vol. 40(1), USA.

Perry, Kathryn S. (1981) Employers and Child Care: Establishing Services through the Workplace, Women's Bureau, US Department of Labor, Washington DC.

Weber, R. and Tullos, B. (1986) "Industry and Child Care: Economic Implications", Academy of Management Journal, USA.

From Child Care in the Work Place, Cost Benefit Study of Employer Provided Child Care, 1989, Department of the Prime Minister and Cabinet, Office of the Status of Women. 47 Appendix 3

Age Retirement - Use of Sick Leave Survey Results

Age Retirement

This question refers to staff who retired in 1989. If these questions cannot be answered from computerised records, in order to save you time, it is suggested that you select up to a maximum of 25 age retirees, alphabetically and sequentially from the letter 'a'.

Please categorise these age retirees into the correct box in the following table. Include retirees who were appointed after 1/7/86.

Between 1/7/86 and 30 6/89 used

10 days 10-29 30-59 60 days sick days days sick leave sick sick leave or less leave ,leave or more 'u ~ --..;" ",20 Weeks //1/11 l') I J I (3) I .~ Full pay ~ ~ 10-19 Weeks 11 (z.) I I -.,,) Full pay

,~ 1 0-9 Weeks 1J I J 11/ I /111/1 l') I11 JI11 I (~) ~ full pay Co) ,.;: " No full 'pay i & ;:>20 Weeks 1 " ~ .~ 1/2 pay

~~ No full pay & "'''' I I - '\.> 10-19 Weeks ~ " 1/2 pay ( .. )

-.0."''" No full pay & III 'J ... I I1 ~ '"':! ~ 0-9 Weeks (; 1/2 pay (2) c.) e>:.'lJ "J

Tc.h..J olep,,,t.,,.,e,,,-ts reSf'c1"\.,f"·'j It

J+.S" 1;/;"a.L r"er,-rees ,,, 1'1 8 ,/ 48 Appendix 4

Case Studies

(a) State High School, Australia

Teaching Staff: 43. Of these 28 were male, 15 were female. Four teachers were part-time.

Of the five uncertificated sick leave days allowed per year in 1989:

Four teachers took five or more days (9.3% - 3 male, 1 female).

Eight teachers took four or more days (18.6% - 6 male, 2 female).

Nineteen teachers took more than two days (44,2%).

Only the deputy principal and five other teachers took no uncertificated leave days (14% - 5 male, 1 female).

Of the six teachers who took no uncertificated leave, five had positions of responsibility (i.e. extra duties, higher pay levels co-ordinators, committee members). Most of the leave occurred on Mondays or Fridays.

This private survey of a stress occupation in a public sector area was made for comparative purposes. It indicates that up to 18.6% of staff were likely to have used uncertificated sick leave days as a form of extra recreation leave.

(b) Teacher Scheme, United States

A novel incentive scheme for New York District teachers was reported by Stephen Jacobson in an article entitled 'The Effects of Pay Incentives on Teacher Absenteeism,.87 In 1986-87 New York enacted an Excellence in Teaching (EIT) program and appropriated $95m for the improvement firstly of entry level teacher salaries and after this of teacher salaries generally. In most districts, collective negotiations resulted in this extra money being divided equally among all teachers. Only 5% of the EIT agreements distributed their money on the basis of some measure of teacher effort. One district, the Sugar Hill Central School District, implemented an attendance incentive plan although their average of 7 days absent per teacher from a 187 day school year was not considered excessive. The scheme worked as follows: An amount of the EIT money, $73,000, was set aside to create a parimutuel pool from which teachers would draw one share for each day less than 7 for which they were absent during 1986-87. Theoretically if only one teacher in the district had fewer than 7 absences, she or he could have won the whole $73,000. As the total number of shares to be paid out was unknown until the end of the year, the scheme 49 in its first year of operation had the appeal of being something of a lottery. In the event, 1,274 shares of $57.16 were paid out, making the bonus for a perfect attendance record $400. The mean number of days that teachers were absent dropped from 7.21 days in 1985-86 to 5.34 days in 1986-87. The median number of absences dropped from 6.5 days to 3.25 days, a 50% reduction in one year. However, although the mean number of teacher sick leave days declined significantly in that year, use of personal leave increased from 1.23 to 1.51 days, indicating that teachers may have substituted between these two categories of absence in order to maximise their rewards. Nevertheless 71% of all district teachers earned at least one share of the incentive pool compared with 58% who had fewer than 7 sick leave days in the previous year. The number of teachers with perfect attendance records rose from 8% to 34% of the total workforce. Substantial savings resulted from the savings on employment of substitute teachers. 50 Appendix 5

The following departments, associations and companies were contacted between October 1989 and January 1990 with requests for details of sick leave entitlements, management initiatives or incentive schemes. I found representatives and officers to be generally extremely helpful and I am indebted to them for their advice and information.

Alcohol and Drug Foundation of Australia, ACT. American Express, Sydney. Angliss Group and Associated Co., Sydney Argyle Diamond Mines, Perth. Brisbane City Council Administration. Business Council of Australia, Melbourne. Commonwealth Bank (Personnel), Melbourne. Citibank, Citicorp, Sydney. Cadbury Schweppes, Melbourne. Department of Industrial Relations, IR Policy Section, ACT. Department of Social Security, ACT. Herald and Weekly Times, Melbourne. Industrial Program Service, ACT and NSW. Meat and Allied Trades Federation of Australia, Sydney. NSW Department of Industrial Relations and Employment, Staff Branch OTC, Sydney. Personnel Practices Contact Group - Individual members representing APS Departments, Canberra. Pacific Dunlop Ltd, Melbourne. Public Service Commission, ACT. Victorian Public Service Board. Western Mining Corporation, Perth. Westpac, Sydney. 51 END NOTES 1. Australian Industrial Relations Commission, National Wage Case 1989, Reasons For Decision, P2.

2. Ibid p. 10. See Appendix 1.

3. Agreement between ACOA, APSA, FCU and the Government on 4% second tier pay increases for office based and related classifications, para. 36.

4. 1975 edition.

5. For example, the studies by Dawkins et aI, September 1985 and November 1985.

6. R.G. Ensley, A Taxonomy of Measures of Absenteeism, Deakin University Occasional paper No. 93, October 1986.

7. As quoted in Wooden and Robertson, Illness, Injury and Absence from Work: An analysis of the 1983 Health Survey, May 1989.

8. For example, Wooden and Robertson, op cit. pp. 33-34. Also Dr Chris Baker, quoted in James, Business Review Weekly 16 June 1989.

9. Wooden, 'The "Sickie": A Public Sector Phenomenon?' .

10. Harkness and Krupinski, "A Survey of Absence Rates, Work and People, 1977.

11. As summarised in Dawkins et aI, Labour Absence; A Literature Review and Annotated Bibliography, September 1985, p. 1. Figures are from the Harkness and Krupinski survey.

12. Crawford and Volard, 'Work Absence in Industrialised Societies: The Australian Case', 1980, p. 8.

13. Wooden and Robertson, op cit.

14. Public Service Board, Survey of the Incidence of Sick Leave in the Australian Public Service, May 1972 - April 1973.

15. For example the work done by the National Institute of Labour Studies Incorporated, Flinders University.

16. Personnel Practices Contact Group Meeting, Treasury Building, 6 December 1989.

17. Wooden, Mark, "The 'Sickie': A Public Sector Phenomenon?" p. 1.

18. Ibidp. 11.

19. Department of Employment, Education and Training, Joint Staffin Review of Relief Staffin in the Commo wealth Employment Service Network, Draft Report of the' view Team, June 1988. 52 20. Budget Resources Branch, Department of Finance.

21. D.E. Taylor, 'Absent workers and lost hours, May 1978' Monthly Labour Review, 102, quoted in Dawkins et aI, Labour Absence: A Literature Review and Annotated Bibliography, September 1985. The Australian figure of 4% is apparently from the Harkness and Krupinski study, 1977.

22. Survey of Absence Rates and Attendance Bonuses, Industrial Society Vol. 3. 1985.

23. Australian Public Service pamphlet on Sick Leave.

24. Public Service Board, Survey of the Incidence of Sick Leave in the Australian Public Service (May 1972 - April 1973), August 1974, Appendix B.

25. Peter Kenyon and Peter Dawkins, Explaining Labour Absence in Australia, Murdoch University Economics Programme Working Papers, No. 1, August 1987, p. 18. See also John Steinke, 'The Long-Term Decline in the Standard Working Year', Journal of Industrial Relations, 25, pp. 415-30. Note, however, that some industries retain 8 days as the annual entitlements. .

26. Infra p. 38.

27. Public Service Board, Report on Departmental Evaluations of Flexible Working Hours, September 1976, pp. 1-4.

28. Public Service Board-ACTU Taskforce, Flextime in the Australian Public Service, 1987.

29. Public Service Board, Survey of the Incidence of Sick Leave in the Australian Public Service, op cit.

30. Keller 'Predicting Absenteeism From Prior Absenteeism, Attitudinal Factors, and Non-attitudinal Factors, Journal of Applied Psychology, 1983.

31. Linklater, 'The Carrot or the Stick?' Directors in Government, 1988.

32. Dr Chris Baker, quoted in James, Business Review Weekly, 16 June 1989.

33. Study quoted in Steers and Rhodes, 'Knowledge and Speculation About Absenteeism' in Goodman, Atkin and Associates, Absenteeism, 1984.

34. Ferguson, 'Sickness Absence, An Analysis of the Problem', Medical Journal of Australia, 17 February 1973, p. 335.

35. Wooden, Mark, with Dawkins and Kenyon, Illness, Injury, and Absence from work: An Analysis of the Health Survey and Other ABS Data Sources, August 1987. 53 36. Steers, R.M. and Rhodes, S.R. Major Influences on Employee Attendance: A Process Model, Journal of Applied Psychology £l, August 1978, pp. 391-407. Also Steers and Rhodes, 'Knowledge and Speculation about Absenteeism', 1984.

37. James E. Harrison et aI, 'Deaths as a result of work-related injury in Australia, 1982-84', Medical Journal of Australia, Vol. 150, 6 February 1989, and Sydney Morning Herald, 6 February 1989.

38. Wooden and Robertson, op cit, May 1989.

39. Financial Review, 6 November 1989.

40. Reported in the Weekend Australian, 7-8 April 1990, p. 39. 41. Research Officer, Industrial Program Service, Sydney.

42. See diagram supra. p. 7 from Crawford and Volard, op. cit.

43. Wallace, Chris, Business Review Weekly, 15 December 1989, p. 33 and 36.

44. Althanasou, J.A. Smoking and absenteeism: Medical Journal of Australia 1979, Vol. 1.

45. December 1989 figure. Statistics in this paragraph are provided by the Statistics Group of the Legislative Research Service of the Parliamentary Library.

46. Wooden and Robertson, op cit, pp. 24 - 25.

47. Wooden, Mark. 'The "Sickie": A Public Sector Phenomenon?' p. 5.

48. See Appendix 1, IRC Efficiency Measures.

49. Department of Employment and Industrial Relations, Women's Bureau, Maternity and Parental Leave Information Paper No. 3, 1985.

50. A.C.T.U. Parental Leave Test Case Background Information, January 1989.

51. See Appendix 3, North American Survey and Anecdotal Evidence on the Benefits of Employer-Supported Child Care.

52. Steers, R.M. and Rhodes, S.R. Major Influences on Employee Attendance: A Process Model, Journal of Applied Psychology 63, August 1978, pp. 391-407. Also Steers and Rhodes, 'Knowledge and Speculation about Absenteeism', 1984. Wooden with Dawkins and Kenyon, 1987, provide a comprehensive discussion of the Steers and Rhodes absence model.

53. Wooden, 'The "Sickie": A Public Service Phenomenon?'

54. Kenyon, P. and Dawkins, P. Explaining Labour Absence in Australia, 1987, p. 22 and p. 19. 54 55. Robert Drago and Richard Per1man, 'Supervision and High Wages as Competing Incentives: A Theory of Labour Segmentation', Department of Economics, University of Wisconsin-Milwaukee, 1985, pp. 1-21.

56. Kenyon and Dawkins, op cit, 1987, p. 23.

57. Wooden with Dawkins and Kenyon, 1987, p. 15.

58. Nicholson et al 'Absence from Work and Job Satisfaction', 197 pp. 728 and 737.

59. Keller 'Predicting Absenteeism From Prior Absenteeism, Attitudes Factors, and Non-attitudinal Factors', 1983.

60. Wooden, M. with Dawkins, P. and Kenyon, P. op. cit. August 1987, pp. 18, 22.

61. Supra p. 9. 62. Winkler, 'The Effects of Sick-Leave Policy on Teacher Absenteeism', 1980.

63. James, Business Review Weekly, 16 June 1989.

64. Robins, The Australian Municipal Journal, October 1988.

65. Quoted in Steers and Rhodes, 1984, p. 248.

66. Quoted in James, Business Review Weekly, 16 June 1989.

67. Figure given in Crawford and Volard, op cit.

68. Kenyon and Dawkins op. cit., 1987, Also Wooden with Dawkins and Kenyon, op. cit., 1987 especially p. 24.

69. Wooden and Robertson p. 3.

70. Mark Wooden, phone answers to questions put.

71. King 'Sickness absence in a Tasmanian Division of the Australian Public Service' pp. 155 and 157.

72. Wooden 'The Sickie: A Public Service Phenomenon'. 1989 p. 8.

73. See Appendix 3.

74. Wooden with Kenyon and Dawkins, p. 63.

75. James, Business Review Weekly, 16 June 1989.

76. Industrial Society, Vol. 3, 1985; Robins, The Australian Municipal Journal, October 1988.

77. Priestly, Baker and the Ford example are quoted in James, Business Review Weekly, 16 June 1989.

78. AnglissGroup and Associated Co., December 1989. 55 79. Don AlIen of the Association of Employers of Waterside Labour.

80. Winkler, 'The Effects of Sick-Leave policy on Teacher Absenteeism', Industrial and Labor Relations Review, Vol. 33, No. 2, January 1980.

81. Phone survey conducted October-December 1989. See Appendix 7.

82. American Express, North Ryde.

83. Herald and Weekly Times, Melbourne.

84. Linklater, 'The Carrot or the Stick?' Directions in Government, March 1988.

85. Dredge and Milton, article in Work and People, Vol. 8, No. 1, 1982.

86. Information from John Stein, Brisbane City Council, 20 November 1989.

87 . Journal of Human R.J!sources Vol XXIV (2). 56

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