Dealing with Employee Absenteeism & Poor Performance Jill Blagden Mowlem Aqumen Good afternoon ladies and gentlemen, my name is Jill Blagden and I am the HR Manager for Mowlem Aqumen, a division of Mowlem. Mowlem is a leading provider of construction and support services to both the public and private sectors, with over 25,000 employees. We are a company worldwide, including our presence in Ireland. As you may have seen we are currently in Dublin constructing the Dublin Tunnel, and, here in Northern Ireland we operate a major FM contract. As HR Manager for Mowlem Aqumen, leading a team of HR advisors and administrators, I have overall responsibility for all aspects of HR relating to the provision of services such as cleaning, security and facilities management for large contracts with the Ministry of Defence, Schools, Courts, Inland Revenue and the NHS. And I’d like to welcome you to this afternoon’s session where I’ve been asked to talk about how you deal with employee absenteeism and poor performance within the FM industry and to highlight practical steps to try and deal with these two issues

Agenda the facts, the issues, the processes to address • Absence the facts, the issues, the processes to address • Performance Management why people poor perform and how to resolve • Summary and your questions Today’s session will commence with looking at absence – the facts, the issues and processes to address , using a common scenario which we as managers have probably all experienced. The second part of this session will focus on why people poor perform and what we can to resolve – and what a performance mgmt culture in a business actually looks like – and I’ll be speaking specifically about Mowlems processes here. We’ll close the session with any questions you may have. So, a million dollar question which I’m sure you are dying to ask – can we dismiss employees with poor absenteeism and poor performance? Well, the answer to that is Yes - we can dismiss - however we must be careful with our processes as the potential cost of getting it wrong with an unfair dismissal claim today can range from £5000 to £58,00.0

Absenteeism & Poor Performance • Absence – the single most challenging health & safety issue • Performance management – getting the best from our people in order to survive Employee absenteeism is the single most challenging health and safety issue facing employers and HR professionals today. So let’s ask ourselves – what is it we really want from our employees? It’s quite simple really – we want them to come to work and do the job, I n the time that they are employed to do and in return we offer them a contract of employment with terms and conditions. Now without our staff – we might argue we’d do it ourselves and yes we’d do a darn good job! However the reality of this is such that it’s just not possible! So unfortunately – and I say this tongue in cheek – we need to recruit – and rely on - employees to do a job to the best of their abilities! When our staff are at work we - you and I as line managers, are responsible for managing our teams, to ensure we get the best from our people in order to survive! And how we actually achieve this we’ll come onto later on. So in reality what are we faced with when absenteeism hits our agenda as a problem? And what are the effects that this can have on our business?

.. they never say anything so they’re obviously not bothered” “Well, it can be boring and yes I’ve had the odd few days off here and there.. ..but I get paid for it and they (Management) always seem to get cover.. .. they never say anything so they’re obviously not bothered” So with this attitude in mind it’s Monday morning and Jane’s had a weekend of partying so she’s really tired and for today she just can’t face going into work so she decides to phone in sick. Now unbeknown to Jane, her new manager starts today – Kairen – an experienced FM Manager. Kairen replaces the previous manager who has just resigned because she was facing her first written warning for failing to reduce the no of customer complaints about service. Now Kairen’s primary objective with FMRUS is to focus on costs and believe me the cost of staff absenteeism in her department are just one of these areas. So not a good start for Jane! However, Kairen needs to get the reception desk covered asap. So as one of the first tasks of the day, she begins making some phone calls and she finds that the staff really don’t want to come into work on their days off. So after 4 phone calls Kairen manages to get hold of Eleanor who agrees to come in (she could do with the money anyway).

“If she can do it and get away with it “She’s always off sick, it’s not fair, but management just don’t seem to do anything” “If she can do it and get away with it – so can I!”

Absence – The Symptoms Employees Employers 1) Colds/Flu 1) colds/flu 2) food poisoning / stomach upset 3) headache / migraines 4) stress / emotional /personal problems 5) back problems Employers 1) Colds/Flu 2) Stress/emotional/personal problems 3) Monday morning blues 4) Using up sick leave 5) Low morale/boring job This is a common reality which many of us face when dealing with employee absenteeism and poor performance. We often cannot plan for it and don’t always know how to manage it! And it undermines our organisations efficiency! - we’ll come back to this case at FMRUS a little bit later According to a survey by Work Foundation when our staff call in sick the top 5 reasons for absence they give are: - However, speak to most managers and they feel that the real reasons are actually quite different as follows: This means we are faced with quite a challenge particularly when the facts suggest that 2 out of 3 reasons for sickness absence are unconnected to sickness but linked to the job in question, for example

Factors Affecting an Individual’s Performance Stress at work – i.e. pressure / long hours Conflicts between domestics and work life Poor relations with colleagues/ poor management or supervision Poor job satisfaction Over worked or under worked Employees feeling undervalued Poor working conditions & working environment Rotas and shift patterns Having thought about some of these factors, it’s easy to see how this can lead to absence – both genuine sickness and non genuine. Simply, due to the fact that staff will take time off to avoid some of these issues which arise at work, because it’s the easiest way for them to deal with these issues. And if you analyse the above – the majority of these are re-solveable by you and I as managers of our teams. And there are steps we can take – as we shall see later. By Minimising the effect of absence on the business, this will minimise the extent to which our other employees suffer; like Eleanor for example

Sickness Absence – Key Facts • Absence management is the single most challenging health & safety issue • Stress management remains a key issue • Rising cost of employers liability insurance • Government’s targets for improving health & safety Managing Sickness absence is the most frequently cited employment issue and It is not surprising to find that absence emerges as the most important and demanding health and safety issue faced today. Stress is on the increase – it’s the new kid on the block and a growing concern for many employers. The rising cost of employers liability insurance emerges as a top three challenge for employers. This is perhaps not surprising given the high profile attached to the issue by the dept of work and pensions’ current review of the employee liability system The forth key area of concern for us all relates to the govts strategy on revitalising H&S, which sets national targets designed to reduce the number of working days lost, to work related ill health and injuries. The worryng factor is that many businesses and HR professionals are unaware of these targets. So before we start looking at absence mgmt techniques, lets ask ourselves what are we really faced with when handling sickness absence in the workplace.

Sickness Absence…. • I Super Glued my hand to the dressing table • I was attacked by a squirrel on my way to work • Breast augmentation • I broke up with my boyfriend • My cat was sick • Leprosy (changed to ‘flaky skin’ on further questionning) • TTFW (too tired for work ….?) Here are somewhat questionable reasons you may say, however all genuinely submitted by employees as explanations for their sickness absence. While in many cases, the audacity of the individuals concerned may raise a smile, the rate of sickness absence in the UK is no laughing matter.

Sickness Absence – Key Facts • Average employee takes 7 days sickness absence per year – average of 3% of their working time absent • Manual workers take more sickness absence than non-manual workers • Larger organisations & public sector experience higher rates of sickness than smaller and private sector • Cost £25 to £2,000 per person in sick pay & replacement labour costs • 16% employers pay bill spent on managing absence According to the Chartered Institute of Personnel & Development, employees on average take 7 days sickness absence per year. -

“You cannot manage what you Managing Absence “You cannot manage what you cannot measure” Whilst sickness absence is evidently costing the industry significant sums of money according to the Chartered Institute of Personnel and Development, a fifth of employers are unaware as to the extent of that absence, simply because they do not hold such records. Now you may have come across this saying in your day to day business operations; ‘You cannot manage what you cannot measure.’ And it’s absolutely true, and if you relate this principle to absence well, failure to be able to identify your facts about an employee’s sickness absence at any one time, would indicate that you are failing to tackle sickness absence at all. So your starting point is as follows;

Managing Absence – Data Collection • Accurate record keeping • Nature of absence • Frequency of absence • Duration • During a period – financial year The compilation of accurate data is the first step in promoting attendance and is the key to successful absence management. These records should indicate nature, frequency and duration of spells of absence in the given time period – usually the financial year. Managers find it helpful to see how periods of absence relate to days of the working week particularly if absences repeatedly seem to fall either side of a weekend. It also allows us to commence looking for patterns and trends which may highlight issues more effectively. So the next stage is to establish an individual’s rate of absence.

Measuring Absenteeism Lost Time Rate No. of days absent x 100 = absence % Days per week in a given period of time Case 1 Absent for 28 days year to date contracted for 5 days per week 28 days x 100 = 11% absence 240 days (1 year) One method widely used to measure an individual’s absence is the lost time rate. A simple formula designed to determine the percentage of their working time spent absent from their contracted hours of work. Using the formula an absence percentage can be calculated for an individual. The lost time rate is calculated by dividing the number of days absent over their contracted hours – in days - over a given period in time to calculate the absence percentage for that individual. For example in the case at FMRUS, Kairen’s employee Jane who is contracted to work 5 days per week has been absent for 28 days during the working year. To calculate the working year if you minus holiday days this equates to 240 working days per year.. This calculation gives us an absence rate of 11%. And as I mentioned earlier, the industry average proportion of working time lost through sickness is 3% which is equivalent to 7 days per employee per year. Once you have established your facts, you can then begin to instigate an appropriate plan of action. Sounds easy? Unfortunately no, not at all, in fact when it comes to managing absence, it’s a harsh reality which we face! Take a look at the following statements

Views Held On Absence.. Line managers do not like managing absence HR unable to gain board commitment to the issue Significant levels of absence are not genuine Many pro-active absence mgmt policies place line managers at the heart of absence recording and monitoring. Yet managers are often reluctant to take on this role, partly for workload reasons, but also because they believe it is a personnel function Or simply a function in which they have not been trained to carry out. Most support the view that it is the role of HR to persuade senior mgmt that tackling absence is both good employment practice and good for bottom line. One HR Director of a care homes business taking part in a focus group, emphasised the need to make a business case for absence mgmt. “in my organisation, we tell the board that you could have 21 more staff if you got rid of all of the absence”. And as we have seen earlier – and in our case study – significant levels of absenteeism – are unrelated to sickness.

Steps To Managing Absence • Policy • ‘Return to work’ Can you help with anything? Promoting welfare culture Re-iterating to employee that absence is monitored Addressing concerns the employee may have So going back to our case at FMRUS, Kairen needs to let the staff know what absence will not be tolerated and the first step she does is to establish an absence management policy, communicated to all employees. Which establishes; policy A Clear procedures as to who the staff should contact when absent -through sickness to include where to forward sick notes Return to work interviews 2) Return to work interviews form an important part of the strategies for managing absence, allowing the manager to establish the facts about the employee’s absence and likelihood of further absence. These can also act as a preventative measure for non genuine cases – do you fancy sitting in front of your line manager having skived from work?

Short Term Absence • Re-curring illness/medical condition/unrelated illnesses • Non-genuine Investigatory hearing Disciplinary hearing Dismissal Appeal Now we talk about short term and long term absence Short term is ; - When dealing with short term absence this usually commences with a a counselling session in the first instance. The absence is then further monitored and if the individual has further spells of absence during a period of time , then disciplinary proceedings will commence with the issuing of a verbal warning, extending to dismissal should the situation fail to improve. Authorisation for dismissal in this way is for misconduct and employees have the right to appeal against any dismissal.

Long Term Absence • Home visits seeking authority for medical evidence • No legal definition • Home visits seeking authority for medical evidence • Never dismiss until sick pay is exhausted • Dismissal – for incapability – not fit to attend work • Dismissal – for misconduct – evidence says they should return and they refuse! • Right to appeal Long term absence – well; - Up to 4 Weeks there should be a minimum of one home visit plus telephone 4 to 8 Weeks you should obtain the first doctor’s report and another home visit. When a second doctor’s report is obtained then a further home visit should take place. When dealing with long term absence cases, where there is an underlying medical cause, then dismissal will only be deemed appropriate following investigations supported by medical evidence.

Managing Health At Work? • Advice on accident reporting, substance abuse, sexual health & HIV • Policies and procedures on healthy lifestyles, complementary medicines, massage, reflexology Duvet Days • Counselling / support services - assistance programmes • Stress audits and training Despite the issues that managing absence are presenting employers, many are taking proactive measures with regards to employee relations, focusing their attentions on preventative measures such as the introduction of health at work initiatves. As highlighted earlier employers are predicting that stress at work is on the increase and in anticipation of this health related policies and guidelines on stress are currently being implemented. By recognising that absence is not always sickness related and can be linked to aspects of work ‘managing health at work’ is being introduced as a KPI into management role and responsibilities. Just like Kairen’s objectives as an FM Manager.

One last thought on absence.. “The key to effective management of sickness absence lies primarily with line managers since they are best placed to know & take interest in their staff as a matter of routine.. …they are therefore likely to be alert to problems inside or outside the workplace, which could impact adversely on an individuals attendance” This is absolutely right! Gong back to the case study, Kaiern’s return to work interviews with the worst offenders seemed to do the trick and Jane’s attendance improved significantly – but Jane wasn’t happy about this new regime – which was having an impact on her performance in other ways… which we’ll come onto later. It is important not to underestimate the support and guidance managers need from their HR Teams. At Mowlem, we have comprehensive policies and procedures which are implemented through training courses delivered by the HR to all managers with responsibilities for managing staff. By investing in effective training & development we can ensure that all staff have the right skills, knowledge and tools to allow them to carry out their job and to carry this out effectively! Which leads us onto part two of this session – dealing with poor performers through action planning.

Managing Performance “Managing performance – getting the best from our people in order to survive” Managing performance – getting the best from our people in order to survive and dealing with those who don’t perform for whatever reason! So ask yourself what is your organisation doing about the management of staff and their performance? What kind of objectives do you have to drive your business forward? How are these communicated to employees and embedded in work processes?

Why Do Employees Perform Poorly? • Those who can do the job but won’t • Those who can’t do the job and don’t Why do people perform poorly? Is it because they don’t know what they should be doing? Is it because they don’t know how to do what they should be doing? Is it because they don’t like the job – but have nowhere else to go? Is it because they don’t like the people they work for or work with? Is it because the job is too big for them? Or too small? Is it something outside of work that’s affecting them at worK What a mixed bag of things it could be as to why people poorly perform at work. So where do you start? Well your starting point is to find out what is causing the poor performance and you need to have I objective in mind – you need to distinguish between Conduct – those who… And Competence – those who… Because both of these issues result in poor performance!

Poor Performance Management • Job description • Training Regular work reviews • Investigatory • Disciplinary • Demotion or dismissal The starting point when performsnce managing an individual is to ensure that they know what’s expected of them! Ie being clear about their roles and responsibilities. We have a duty to provide them with the necessary training to undertake the role. Regular work reviews with specific objectives being set and progress should be assessed and discussed. Should the individual fail to make the improvements – as agreed at the review meetings then disciplinary proceedings must commence with an investigatory hearing. The investigatory gives the employee a chance to explain formally why they are not meeting objectives. You are there to listen to their reasons. It is your decision at this stage as to whether you decide on further training or whether you go to a disciplinary hearing over this. If you are satisfied that as a result of the training, coaching and support that the indiviudal has had and you cannot do any more for the individual in this way then your decision should be to take it to a disciplinary hearing. You would normally issues a first warning setting timescales for improvement and if these are not met – you move onto a written warning. Should you get to a final warning which is looking like a dismissal you should be asking the individual to consider demotion – although this depends on your vacancies! Otherwise it’s dismissal – and they have a right to appeal against any decision you take! Beware, tribunals believe it takes at least 3 to 6 months to be able to apply a fair procedure to fairly dismiss a poor performer, In my experience as a HR manager, I can say, that although I have commenced disciplinary proceedings, I have never dismissed, as the individual concerned has always resigned.

A Performance Management Culture • Mowlem is expanding • Talent in place to successfully operate • Performance review is a key process • Robust training – IIP accredited • TUPE transfers – large % of our staff • Performance management processes are critical Having a clear performance management process in place is critical to Mowlem. And why? Well we are currently bidding – and are likely to win – a large number of contracts so looking at our manpower requirements for the next 5 years we absolutely must have a robust performance mgmt process to support the growth of our talent within the business and address those individuals who are not going to make it. And TUPE – large part of our staff establishment is made up of TUPE transferees – so we inherit a lot of our resources – be it highly skilled or poorly performing presenting all sorts of challenges relating to performance mgmt. So what is the key strategic driver for this?

Performance Management Planning • Performance review twice per year • Summary overview of employee performance • Top performers • Poor performers • Action plans in place Well all of our employees undergo a formal performance review twice per year and the completed appraisal documents are reviewed and signed off by the head of departments.documents are then sent to HR who produce a private & confiidential summary of scores for each business unit. From this summary, you are able to identify your top and bottom performing people through their scores. And this is where your performance management action planning comes into place. HR working with the line managers can begin to tackle the top performers, through training & development, to ‘round off’ the skills they need for their next move,

Summary • Organisations are increasingly coming to recognise that healthy individuals mean healthy business “We want sick people to stay at home and well people to come to work!” Performance management – getting the best from our people in order to survive And Performance mgmt … Anyway before we close this session remember our case study

Dealing with Employee Absenteeism & Poor Performance Your Questions? That concludes this afternoon’s session about how you deal with absenteeism in employees and poor performance within the FM industry. So ladies and gentlemen – your questions please?

Dealing with Employee Absenteeism & Poor Performance Jill Blagden Mowlem Aqumen Thank you very much and Good afternoon.