CAM Solutions estimates the annual direct cost of absenteeism to be:
Eastern Cape > R1 billion
Gauteng > R5 billion
SA National > R12 billion
In an article published by the Government in 2000, they estimated the direct cost of sick absenteeism for public servants to be R632 million (Geraldine Fraser-Moleketi, in Parliament). This is likely to have increased to around R1 billion in 2004.
Abnormally high sick absenteeism has a large impact on the profitability of an employer. This is not only felt in the direct cost (unproductive earnings for the employee when on sick leave) but also through the indirect costs resulting from this type of absenteeism. These costs could be as much as 200% of the indirect costs and in exceptional cases could be even higher.
The typical indirect costs of sick absenteeism are:
- Normal and overtime pay for replacement workers
- Reduced production volumes (or service levels)
- Reduced quality (including staff morale and motivation)
- Training costs
- Increase in medical aid costs
- Increase in Group Life and Disability Insurance
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