Controlling Costs Through Effective Absence Management

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Controlling Costs Through Effective Absence Management

In an era where concerns about controlling costs is more crucial than ever, managing employee absenteeism is one area where HR departments are empowered to make a real impact on the organization’s bottom line. A cost analysis from a Mercer report entitled The Total Financial Impact of Employee Absences found that the total cost (direct and indirect) of all absence categories (scheduled and unscheduled) averaged 36% of total payroll. The most costly days, the analysis continued, were unscheduled absences- largely attributable to the indirect costs associated with higher rates of lost productivity for these types of absences.

So what are Northeast Ohio employers doing to help minimize what is clearly a large financial burden on employers across the nation? According to the ERC Absence Management Practices Survey, simply recording these absences is the most popular method, with 94% of respondents indicating this basic tracking method is how they manage or control absences. Other top reported methods include “disciplinary actions” (74%) and “using attendance as a performance criterion” (70%).

Interestingly, manufacturers are approximately 30% more likely than non-manufacturers to utilize these more structured measures, which in some cases even have direct ties to rates of compensation. In contrast, non-manufacturers trended towards more forgiving strategies such as “flexible work arrangements” and “paid time-off banks.”

Unsurprisingly, “illness” (88%) is the most common reason for unscheduled absence, with “home/family obligations” and “child-care issues” next in line at 61% and 54% respectively. To combat these issues specifically, 44% of participants reported allocating “family leave” as part of their overall attendance policy and 29% of organizations pointed to “wellness programs”- a key preventative measure to help combat unscheduled absences due to illness at the root of the problem.

Overall, the Absence Management survey reported that the average number of days lost per employee per year due to unscheduled absences is 3.9 days, a number 1.4 days better than the average reported by the Mercer report on the national level.

View ERC's Absence Management Practices Survey Results

This report summarizes the results of ERC’s survey of organizations in Northeast Ohio on practices related to attendance and unscheduled absence.

View the Results

5 Measurements to Evaluate Salaries

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6 Tools to Evaluate Salaries

Does your organization know the health of its base salary program? The health of your base salary practices can easily fly under the radar if you aren't paying attention to certain important numbers. It may result in overpaying or underpaying employees, employees being paid outside of pay ranges, an uncompetitive mix of pay forms, or a low revenue return on your costly investments.

There are several "tools" (i.e. calculations or measurements) that you can use to evaluate the health of your base salary program, six of which are among those that most compensation experts agree are the best and most common tools to use.
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What is ADA?

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The Americans with Disabilities Act (ADA), enacted in 1990 and amended in 2008, prohibits private employers with 15 or more employees, state and local governments, employment agencies, and labor unions from discriminating against qualified individuals with disabilities in employment activities. Such activities include hiring, termination, training, promotion, compensation, and other terms and conditions of employment.
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5 Ways to Spot & Develop an Emerging Leader

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5 Ways to Spot & Develop an Emerging Leader

Your emerging leaders are your rising managers and leaders in the making. But how do you spot an emerging leader and then develop them into a leadership role? Picking the right people and training them the right way is essential. That's why we've provided five (5) qualities these talented employees usually embody plus 5 ways to develop them.
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Financial Concerns Drive Innovation in the Workplace

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The results of the 2012 ERC/Smart Business Workplace Practices Survey demonstrate a commitment among Northeast Ohio employers to improving their workplaces despite and in some cases because of the financial challenges they face in today’s economy. While respondents indicate for the second year running that the economy is no longer their most pressing challenge, cost related challenges more generally such as funding, healthcare costs, controlling costs and financial stability are all among the top ten challenges reported by employers.

Perhaps the most striking fiscal measure being utilized to control costs reported by participants is layoffs. After a sharp decline in 2011, the percent of organizations anticipating layoffs for the coming year increased to 10.3%. However, it is important to note that while higher than 2011, this number still falls in line with pre-recession levels when double digit percentages were commonplace.
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11 Tools for Recruiting Hard-to-Fill Jobs

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11 Tools for Recruiting Hard-to-Fill Jobs

Recruiting for new, specialized, or highly technical positions requires a different approach than past years. Some of these jobs didn't exist 10 years ago, while others require such specialized experience or specific technical skills that older recruiting methods don't suffice. In any case, the need to find talent for these hard-to-fill jobs is forcing many employers to consider using other recruiting strategies beyond job boards and advertising.

Employers that excel at recruiting hard-to-fill positions have moved beyond traditional recruiting techniques like job boards and advertising by tapping into their existing employees' networks, building online strategies, and uniquely targeting their marketing to prospective candidates. Their recruiting methods are more strategic, sales and marketing-based, and make greater use of existing employees as talent scouts as opposed to just recruiters and HR staff.

Based on research we've conducted on how employers successfully land talent for hard-to-fill jobs, here are 11 effective tools to recruit hard-to-fill jobs.
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Strategies for Stress Management

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Information provided by ERC Partner University Hospitals

Stress – the mere mention of the word often evokes images of racing heartbeat, headache or tension. Stress may be considered as any physical, chemical, or emotional factor that causes bodily or mental unrest and that may be a factor in causing disease.  

Americans continue to struggle with high stress levels, which can have a detrimental effect on their health. According to the American Psychological Association, 75% of adults reported experiencing moderate to high levels of stress in the past month and nearly half reported that their stress has increased from 2011.  The problem is not limited to adults. Stress is a top health concern for U.S. teens, and psychologists say that if they don’t learn healthy ways to manage that stress now, it could have serious long-term health implications.
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Trends in Performance Management

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According to the 2012 ERC Performance Management Practices Survey virtually all organizations use individual performance evaluations of some kind regardless of industry or organizational size. Performance improvement plans, goal setting and individual development plans are also highly utilized by 90% of employers or greater.

The results of these evaluations are directly tied to employee compensation at 65% of these organizations. Just less than half of these organizations then link individual performance evaluation results to compensation by drawing formal connections between raises/bonuses and a certain rating level or performance evaluation score (48%). Interestingly, none of 2012’s participants report utilizing forced rankings- a slight departure from the 2010 survey results in which 10% of respondents indicated they used a forced ranking system.
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What is Discrimination?

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Discrimination in the workplace refers to when an individual or group of individuals are treated less favorably than others solely because of their race, sex, pregnancy or marital status, age, disability, religion, sexual preference, trade union activity, or other class or characteristic protected under federal or state legislation. It is illegal for employers to discriminate against individuals from protected classes in the workplace if they are current or prospective employees, such as job candidates.

Laws Covering Discrimination

There are a number of important federal laws that cover discrimination of protected individuals. Some states have additional bases on which discrimination is prohibited. Federal laws governing discrimination in the workplace for private employers in 2012 included:

The Equal Employment Opportunity Commission (EEOC) is the federal agency that is responsible for enforcing these laws and handling discrimination claims. It frequently provides guidance and information about recent cases and claims to help employers enforce these laws in the workplace.

Discriminatory Employment Practices

Under these laws, it is illegal for employers to discriminate against individuals in protected classes for employment decisions related to hiring and firing; compensation; assignment or classification of employees; transfer and promotion; layoff or recall; job advertisements; recruitment; testing; use of company facilities; training programs; fringe benefits; retirement plans; disability leave; and other conditions, terms or benefits of employment.

This means that employers cannot make employment decisions based on any factor protected under law. For example, employment discrimination could occur if an employer pays equally-qualified employees different salaries based on their sex or race, excludes potential employees from the hiring process based on their religious affiliation or race, lays off an employee based on them being in a protected class, denies a promotion to an otherwise qualified employee who can perform the essential functions of the job because he or she has a disability; or states preferred characteristics which are protected under law in a job ad.

Additionally, individuals covered under this legislation are protected from four types of discriminatory practices including:

  • harassment on the basis of their protected class;
  • retaliation from their employer based on filing a charge of discrimination, participating in an investigation or opposing discriminatory practices;
  • employment decisions based on stereotypes, assumptions, or myths about the abilities, traits or performance of individuals within a certain class;
  • denying employment opportunities to a person because of marriage to or association with an individual of a particular class

Disparate Impact and Treatment

Discrimination can be manifested in either disparate treatment or disparate (otherwise known as "adverse") impact. Both types of discrimination against protected classes are prohibited under federal law.

It is unlawful for employers to use practices that have disparate impact on a protected class unless the characteristic can be deemed a “bona fide occupational qualification.” In cases of disparate impact, employers do not intentionally and explicitly have policies or practices in place that exclude or discriminate against individuals in protected classes. Policies or practices that seem neutral, however, can adversely impact a protected class. A common example of disparate impact is testing all job applicants on a particular skill or ability and disproportionately eliminating African Americans based on the results, even though this practice is not intentional.

Disparate treatment is also illegal, but differs from disparate impact in that it is intentional discrimination. With disparate treatment, an employer intentionally treats individuals of a protected class differently than other employees or job applicants to control an outcome.

Your Responsibilities As An Employer

Employers are required to post notices describing the federal laws prohibiting job discrimination based on race, color, religion, sex (including pregnancy), national origin, age (40 or older), disability or genetic information. Employers must also keep certain records, regardless of if a charge has been filed with them, including certain workforce data in the annual EEO-1 report. In addition to these obligations employers should:

  • Develop and implement a clear policy prohibiting discrimination in the workplace and retaliation against an employee making a discrimination complaint
  • Train supervisors and managers on employment discrimination
  • Refrain from asking about protected characteristics in the hiring process
  • Regularly evaluate hiring and selection practices for adverse impact
  • Conduct compensation audits to assess pay equity
  • Document objective, performance, and job-related reasons for all employment decisions

For more information about workplace discrimination, ERC members can access our HRresources or contact ERC's HR Help Desk at Not a member? Join today and access tons of HR resources, posters, forms, information, guidance, and legal trends and updates to help keep you compliant.


Please note that by providing you with research information that may be contained in this article, ERC is not providing a qualified legal opinion. As such, research information that ERC provides to its members should not be relied upon or considered a substitute for legal advice. The information that we provide is for general employer use and not necessarily for individual application. The data used in this article reflects the current laws in 2012.

Additional Links & Resources

Prohibited Employment Policies/Practices (Source: EEOC)

Federal Laws Prohibiting Job Discrimination Questions & Answers (Source: EEOC)

Guide for Employers: The Charge Handling Process (Source: EEOC)

Discrimination in the Workplace (Source: HR Hero)

Engineering Salaries Continue to Thrive

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Once again the ERC Salary Survey demonstrates the strength of the region’s Engineering industry. The 2012 Salary survey reports data on 38 separate engineering positions, with the bulk of the job titles falling into the “Professional” job classification. The strength of the industry is further reinforced by comparing median salaries among engineering positions in lower level job classifications to other job titles outside of engineering. For example, Service Installation Representatives (both junior and senior level) make up 2 of only 9 office/clerical positions with median salaries over $40,000. Similarly, at the supervisory and managerial level, the median salaries for engineering jobs all fall within the top 40%- with Engineering Manager / Chief Engineer near the very top of the list as one of only seven jobs reporting a median salary at $100,000 or above.

Despite strong local salary data trends, national employment trends suggest that the engineering field may be mixed in terms of job growth projections depending on the specific position. In particular the BLS Occupational Outlook Handbook in 2012-2013 notes that in terms of job growth engineering positions based in manufacturing may struggle to keep pace with those in service industries and architectural fields. However, with an average project job growth rate from 2012-2020 of 10% and much higher for niche areas such Biomedical Engineers (62% job growth) and Environmental Engineering Technicians (24% job growth), engineering appears to be more than capable of sustaining and even improving upon these salary numbers for the foreseeable future.

Additional Resources

To purchase or view the most recent ERC Salary Survey, click here. Or, e-mail or call 440-684-9700.