Module IV: Managing Personnel Problems

Absenteeism & employee turnover; Enforcement of discipline; Domestic inquiries & disciplinary
action; Health & Safety; Voluntary retirement scheme, Employee Engagement, Work-Life
Balance, Whistle Blowing.

Absenteeism

Absenteeism refers to the habitual non-presence of an employee at their job. Habitual

non-presence extends beyond what is deemed to be within an acceptable realm of days away
from the office for legitimate causes such as scheduled vacations, occasional illness, and family
emergencies.
Causes of over-absenteeism include job dissatisfaction, ongoing personal issues, and chronic
medical problems. Regardless of the root cause, a worker who exhibits a long-term pattern of
being absent may tarnish their reputation, which may consequently threaten their long-term
employability; however, some forms of absence from work are legally protected and cannot be
grounds for termination.
KEY TAKEAWAYS
● Absenteeism is broadly defined as employee absence from work for lengths beyond what
is considered an acceptable period.
● Frequent causes of absenteeism include burnout, harassment, mental illness, and the need
to care for sick parents and children.
● There are reasonable causes for short absences, including vacation or occasional illness
and obligatory responsibilities like jury duty.
● Chronic absenteeism has detrimental effects on a company, such as lowered productivity,
increased costs, and employee burnout.
● Ways to manage absenteeism include providing a better work-life balance and physical
and mental health benefits.
Absenteeism refers to absence from work that extends beyond what would be considered
reasonable and customary due to vacation, personal time, or occasional illness. Companies
expect their employees to miss some work each year for legitimate reasons.

However, missing work becomes a problem for the company when the employee is absent
repeatedly and or unexpectedly, especially if that employee must be paid while they are absent.
Absenteeism is also a problem if an employee is missing in action during busy times of the year
or when deadlines for major projects are approaching.

Why Absenteeism Happens

Below are some detailed explanations of the top reasons absenteeism may occur:

● Burnout. Overworked employees with high-stake roles sometimes call in sick due to
high stress and lack of appreciation for their contributions.
● Harassment. Employees who are habitually picked on—either by senior management
personnel or fellow staffers—are apt to ditch work to escape the relentless
unpleasantness.
● Childcare and eldercare. Employees might have to miss extensive work days if they are
charged with watching loved ones when regularly hired caregivers or babysitters become
sick and temporarily cannot fulfill their obligations.
● Mental illness. Depression is the leading cause of American absenteeism, according to
statistics from the National Institute of Mental Health. This condition often leads
individuals to abuse drugs and booze, which in turn causes further missed days of work.
● Disengagement. Employees who feel dispassionate about their jobs are likely to blow off
work simply due to a lack of motivation.
● Injuries or illnesses. Illness, injuries, and doctor's appointments are the main reported
reasons employees don't come to work. The number of absentee cases dramatically rises
during flu season.
The Costs of Absenteeism

The direct cost of absenteeism decreases business productivity, reducing revenues and profits. If
an employee cannot work, they cannot contribute to the growth and success of a company.
Suppose the work of these absent employees cannot be covered by other employees. In that case,
the reason they were hired leaves a gap in the company's workforce even if their work is picked
up by other employees, which creates more work for them, eventually leading to burnout.

How to Reduce Absenteeism

Employers may discourage absenteeism by taking several proactive steps—such as rewarding

good attendance, providing emotional support to employees, setting clear attendance
expectations, and formalizing the organization's attendance policy in written documents—that all
new employees must review and sign.

Employee Turnover

Employee turnover refers to the number or percentage of workers who leave an organization and
are replaced by new employees.
Measuring employee turnover can be helpful to employers that want to examine the reasons for
turnover or estimate the cost-to-hire for budget purposes.
In human resource management, turnover or staff turnover or labor turnover is the rate at which
an employer loses employees. It indicates the period employees tend to stay.
Turnover is measured for individual companies and their industry as a whole. If an employer is
said to have a high turnover relative to its competitors, employees of that company have a shorter
average tenure than those of other companies in the same industry.
High turnover may harm a company’s productivity if skilled workers often leave and the worker
population contains a high percentage of apprentice workers.
Causes of employee turnover
1. Rude behavior
2. Work-life imbalance
3. A mismatch between the job expectations
4. Employee misalignment
5. Feeling undervalued
6. Coaching and feedback are lacking.
7. Decision-making ability is lacking.
8. People skills are inadequate.
9. Organizational instability
10. Raises and promotions were frozen.
11. Faith and confidence shook.
12. Growth opportunities not available

Ways of Reducing Employee Turnover

Employees are essential in running a business; without them, the company would be
unsuccessful. However, today’s employers are finding that employees do not remain for a long
time in the same organization.
When companies hire the best-talented people, they should maximize the return on each
employee’s investment.
They should listen to employees’ problems and make them feel involved, creating loyalty,
reducing turnover, and allowing for growth.

1. Interview candidates carefully to ensure they have the right skills and fit well with the
company culture, managers, and co-workers. This is highly practiced in Japanese firms.
2. Encourage employee creativity with benefits, flexible work schedules, and bonus
structures when necessary.
3. Recognition and praise are cost-effective ways to maintain a happy and productive
workforce.
 4. High employee turnover hurts a company’s bottom line. Experts estimate it costs upwards
of twice an employee’s salary to find and train a replacement. And it can damage morale
among remaining employees. The employee starts to think, “What else are they not being
truthful about?” When trust is missing, there ‘can be no actual employee ownership.
5. Hiring the right people from the start
6. Setting the proper compensation and benefits.
7. Reviewing compensation and benefits packages at least annually. In the early days of the
management study, Frederick Winslow Taylor wrote that what workers most want is high
wages – which would help them fulfill their basic physiological needs.
8. Paying attention to employees’ personal needs and offering more flexibility.
9. Make sure your best people are personally committed to the organization’s goals.
10. Ensuring talented employees feel they are playing a significant role in reaching those
goals.
11. Recognizing and praising might be the most cost-effective way to maintain a happy,
productive workforce.
12. Creating a satisfying workplace.
13. Praising after a project.
14. Outlining challenging and clear career paths. Peter Drucker wrote, “Making a living is no
longer enough,” and “Work also has to make a life.” If you want to keep good people,
their work needs to give them meaning – they are doing something meaningful and
fulfilling their destiny. These psychological needs are likely to be more critical, perhaps
more important, than the salary you pay”.

Enforcement of discipline
Discipline is the foundation on which any workplace functions. Enforcing discipline properly
will result in more productive and less troubling circumstances in the workplace. An employer
cannot dismiss an employee under any circumstances, even with valid reason, without holding a
disciplinary hearing. This will ensure that a fair procedure is followed and that there is
substantive reason (proof) for the employee to be dismissed.
Steps to follow when enforcing discipline

1. Investigate
During the investigation the employer must determine all the facts surrounding the misconduct
and make sure accusations are not brought maliciously. The investigation should be conducted in
a fair and objective manner by a person with sufficient knowledge about the specific working
environment. Take care not to rush the investigation, rather take the time to investigate the matter
thoroughly. The matter must be addressed within a reasonable time. We advise employers to take
more or less a week, depending on the matter.

2. Gather evidence
The employer should gather evidence to confirm the facts surrounding the misconduct. Evidence
can include witness statements, photos, video footage, documentary evidence and interviewing
the employee. Take note that during the disciplinary hearing the employee (accused) must be
given the opportunity to cross examine witness and question evidence. Therefore all witnesses
must be present during the hearing and can an affidavit not replace a witness, as a document
cannot be cross examined.

3. Consult the employee

It is important when consulting with the employee to give the employee the opportunity to
present more information and explain the situation from his/her point of view. The employer
should also determine if the offence was due to the employee’s negligence or with intent.

4. Determine the sanction

The sanction is determined by the seriousness of the offence. To establish if the sanction is fair,
the employer must consider the facts of the case as every case has its own merits. It is important
to note that the employer must prove on a balance of probability that the employee is guilty
before imposing any sanction.
5. Take disciplinary action
A disciplinary code is vital to ensure that there are clear rules in the workplace, with appropriate
sanctions, for employees to follow. When these rules are broken the employer can apply
progressive discipline (warnings) or in cases of severe misconduct proceed directly to a
disciplinary hearing. The employer must take note to keep detailed records of employees’
misconduct and sanctions applied.

What is Domestic Enquiry

Domestic enquiry is similar to a trial in a court of law, domestic enquiry is conducted

for offences committed against the establishment for misconduct, punishable
under the standing orders/ conduct and discipline rules and regulations of the
organization. Domestic enquiry is conducted according to Principals of ‘Natural Justice’.

The term domestic enquiry is mainly used to refer to an enquiry into the charges of
indiscipline and misconduct by an employee. In common parlance, domestic enquiry means
departmental enquiry or domestic tribunal. In such enquiries, the matter is decided by
disciplinary authority or administrative officers and not by courts of law. In cases of alleged
indiscipline, it is common for disciplinary authorities in a department or in an industry to
appoint an officer or officers to inquire into the allegations against an employee. These
enquiries are commonly known as ‘Domestic Enquiries’.

WHAT IS DOMESTIC ENQUIRY(CONCEPTS)

What is Domestic Enquiry

Domestic enquiry is similar to a trial in a court of law, domestic enquiry is conducted

for offences committed against the establishment for misconduct, punishable
under the standing orders/ conduct and discipline rules and regulations of the
organization. Domestic enquiry is conducted according to Principals of ‘Natural Justice’.
The term domestic enquiry is mainly used to refer to an enquiry into the charges of
indiscipline and misconduct by an employee. In common parlance, domestic enquiry means
departmental enquiry or domestic tribunal. In such enquiries, the matter is decided by
disciplinary authority or administrative officers and not by courts of law. In cases of alleged
indiscipline, it is common for disciplinary authorities in a department or in an industry to
appoint an officer or officers to inquire into the allegations against an employee. These
enquiries are commonly known as ‘Domestic Enquiries’.

Principals of Natural Justice

(1) Nemo in propria causa judex, esse debet – No one should be made a judge in his own case, or
the rule against bias.
(2) Audi alteram partem – Hear the other party, or the rule of fair hearing, or the rule that no one
should be condemned unheard.

Who is authorized to punish employee

It is only the employer or the appointing authority also known as notified disciplinary
authority who can pronounce the penalty. The enquiry officer should examine the evidence and
give his findings on charges leveled on delinquent employee.

Legal requirement of Domestic enquiry

Domestic enquiry has been provided under the standing orders to be framed in the Industrial
Employment (Standing Order Act) 1946. As a result it is now well-established that such
standing orders have the force of law and constitute statutory terms of employment.
The case law established over a long period has made it obligatory for the employers to
hold a fair and just enquiry to prove the misconduct before awarding any punishment.

Show Cause Notice

After deciding the punishment for the misconduct proved against the employee
the Disciplinary Authority should issue a show cause notice furnishing his order and
proposing the punishment and advising the employee to show cause why such a
punishment should not be awarded to him.

Ex-Parte
While reasonable opportunity should be provided to the employee to defend himself,
willful delay of the proceedings on his part on flimsy grounds such as the
non-availability of Defence Representative etc., should not be allowed. Where the
enquiry is conducted ex-parte, the Presenting Officer will present his case by introducing
the witnesses and documents in the usual manner. There will, however, be no
cross-examination, since the defence is not present. The Enquiry Officer should also
record all such proceedings as detailed above and proceed on merits of the case.

PRINCIPLES OF DOMESTIC ENQUIRY

1. Rule of Natural Justice must be observed.

2. The delinquent is entitled to a just hearing.
3. He can call for his own evidence.
4. Cross-examine any witness called by the prosecution.
5. Where rules are laid down, the procedure of such rules must be followed.
6. Disclose to the employee concerned, the documents of records and offer him an opportunity to
deal with it.
7. Do not examine any witness in the absence of the employee.
8. The enquiry officer is at liberty to disallow any evidence after recording the reasons in writing.

Disciplinary Action
When you hire an employee, you expect them to maintain a certain level of performance and
comply with employer policies, procedures, and laws. Employee disciplinary actions are
corrective actions a company takes in response to an employee failing to meet performance
expectations or having behavioral problems. The purpose of disciplinary action is to correct the
behavior of the employee while documenting the issues in case the problem arises again in the
future. In other words, the primary goal of disciplinary action is not to punish the employee.
Verbal A verbal warning is a step in which a manager or supervisor talks to an
warning employee about problems involving workplace behavior, conduct, or overall
job performance. Generally, if it is the team member’s first warning or the
issue is minor, a one-time verbal warning is all that is needed.

A written This kind of warning is in the form of a written document that alerts the
warning employee to their misconduct in the workplace. Generally, a written
reprimand will include the possible consequences if the team member does
not fix their conduct.

Loss of It is sometimes possible that poor employee behavior is related to certain

privileges privileges, for example, recklessly driving a company car, spending too
much money on a business credit card, and getting too rowdy at business
parties. In these cases, an organization may choose to take away the
employee’s rights to those privileges so issues can’t happen again.

A performance In some instances, a performance improvement plan (PIP) might be the first
improvement strategy for the employee and is more common when a team member
plan receives a poor performance review. The goal of a PIP is to outline explicit
 objectives the employee needs to meet to avoid transfer, demotion, or
dismissal.

Retraining If an employee’s poor performance comes from a lack of understanding of

their responsibilities or is often making mistakes, they might need retraining
as a form of disciplinary action.

The retraining plan might include re-reading the company’s procedures and
policies, written tests, or online courses. The goals of the retraining should
be clearly communicated and should consist of specific outcomes.

Demotion A demotion is the lowering of an employee’s job title, role, or

responsibilities within the organization. This can be a permanent
reassignment or temporary should performance or behavior improve. It is
often used as an alternative to firing an employee.

However, demotions can make an employee feel unimportant and

unmotivated, which can further negatively impact their poor performance.
Employers should thoroughly consider if a demotion can actually achieve
their desired goals.

Temporary A pay cut is a reduction in an employee’s compensation, such as salary,

pay cut benefits, or hours. It is not just limited to monetary compensation. Pay cuts
are a tricky disciplinary action as they must be aligned with federal and local
laws, namely the Fair Labor Standards Act (FLSA) in the United States.

Suspension A disciplinary suspension is when an organization retains a team member

but asks them not to come to work or engage in any work-related activities.
Unless there is a clause in the worker’s contract that states your employer
can suspend them without pay, usually the employee is paid during this
time.

We commonly see this when someone is under HR investigation and asked

to step away from their work until the investigation is complete.

Termination Termination is the last option if the previous disciplinary actions do not
achieve the desired outcome or an employee has conducted an act of gross
misconduct. Each country has different dismissal procedures and protections
that must be valid in order to let go of an employee.
Health and Safety
The general guidelines for integrating workplace health and safety in human resources
management practices are:
• Preventing work related injuries and illnesses;
• Fostering a workplace safety culture in which employees and their supervisors work together
to ensure workplace safety;
• Establishing administrative procedures that encourage employees to report unsafe conditions
and unsafe practices to their supervisors without fear of being disciplined;
• Developing appropriate hiring, training and performance appraisal practices;
• Recruiting and retaining the best employees who care about their own well being and the well
being of co-workers;
• Ensuring that the health and safety policies and procedures conform with the applicable
occupational health and safety legislation and accepted best practices in similar organizations;
• Establishing procedures for enforcing company safety rules;
• Helping reduce costs associated with losses due to absenteeism injuries, Workers'
Compensation, disability, and health care;
• Maintaining records of injuries, illnesses and workers’ compensation;
• Coordinating first aid training and the provision of first aid to employees;
• Providing advice to employees and the employer in matters of occupational health and safety.

The Factories Act of 1948

It regulates the health and safety of workers working in factories. The act is enforced by state
governments through their factory inspectorates. The Directorate General Factory Advice
Service and Labour Institutes (DGFASLI) coordinates matter concerning safety, health and
welfare of the workers in the factories along with the respective state governments. It conducts
training, studies, and surveys through the Central Labour Institute in Mumbai and three other
labour institutes in Calcutta, Chennai, and Kanpur.
The Mines Act of 1952
It has provisions related to the health safety and welfare of workers in coal, metal and oil mines.
The Director General of Mines Safety conducts inspections and inquires issues, for the purpose
of appointment to various posts in the mines and organizes seminars/conferences on topics
related to safety of workers.
The Dock Workers (Safety, Health, and Welfare) Act of 1986
It contains provisions for the health, safety, and welfare of workers working at the ports/docks.
Overall emphasis is on the number of accidents occurring at the ports.

Health provisions in an Organisations

1. Cleanliness
Every factory shall be kept clean and free from gases arising from any drain or their nuisance.
For this purpose following steps should be undertaken: The dust and refuse must be removed
daily by sweeping from the floors and benches of workrooms, from staircases and from
passages. Effective means of drainage shall be provided and maintained. All inside walls,
partitions, ceilings of rooms must be regularly painted and whitewashed.
2. Ventilation temperature
Effective and suitable provisions shall be made for:
● Adequate ventilation must be there by the circulation of fresh air in the workroom.
● Reasonable comfort must be provided to the workers.
● Walls and roofs must be of such material and designed in such way that temperature is
not
● exceeded and kept low in the working area.
● Hot parts of the machinery are kept insulated.
3. Artificial humidification
If there is an artificial humidification it shall be of prescribed standard and created by the
prescribed methods. The water used for such humidification shall be clean and free from dirt.
4. Lighting
Sufficient and suitable lighting whether natural or artificial or both should be maintained and
provided at the working places. All the glazed windows and skylight shall be kept clean on both
the inner and outer surfaces. Glare and formation of shadows should be prevented to avoid
eyestrain or risk of accident.
5. Drinking water
Drinking water should be made available to all workers at all working hours and should be
provided and maintained at suitable points.
6. Bath rooms
If the work in the factory is of such nature which involves dirt a sufficient number of bath
rooms shall be provided.
7. Latrines and urinals
Separate enclosed accommodation for male and female workers shall be provided. The
accommodation shall be adequately lightened and ventilated and shall be maintained in clean
and sanitary conditions at all times.
8. Spitoons
Sufficient number of spittoons shall be kept at convenient places and they shall be washed
regularly and kept clean.

Human resources professionals play an important role in ensuring employee health and safety, as
they know the workplace, the employees and their job demands. While human resources
professionals are not expected to know the technical aspects of workplace health and safety, they
should know when and how to use existing resources to respond to employee concerns.
A Health & Safety Program consists of clearly defined actions to implement the health and
safety policy. In a large company it is desirable to have a full time safety director in addition to
analysts, engineers, safety inspectors. The safety director serves as an innovator, advisor, and
analyzer. He has to organize safety programmes throughout the plant, investigate and collect
accident data, organize meetings with the line managers.
There are some health provisions like providing cleanliness, proper ventilation, proper lighting,
drinking water, bathrooms etc. There are some safety provisions like providing casing of
machinery, hoists and lifts, protection of eyes, precautions against fire, precautions against
dangerous fumes etc.

Voluntary retirement scheme

As per VRS, an employee can choose to retire before the retirement age or date. Both private and
public sector companies can offer their employees VRS. Some companies implement VRS to
reduce their overall employee strength. Often, VRS is known as the Golden Handshake.
How Does VRS Work?
Employees who are above the age of 40 or have completed ten years of service are eligible for
VRS. All executives and workers of companies and authorities of cooperative societies can opt
for VRS. Cooperative society directors cannot avail themselves of the VRS policy. According to
the regulations, the company can allow VRS to reduce their overall workforce. So, once
somebody opts to retire early, the company cannot refill the position. Public Section
Undertakings (PSUs) must ask the government for prior approval before offering their
employees VRS. Private firms and companies can frame their own regulations. All companies
must follow the government’s regulations as per Section 2BA under the Income Tax rules. Most
importantly, an individual who opts for VRS cannot join another firm run by the same
management.
Features of VRS
● To be eligible for VRS, the employee must complete at least ten years of service or needs
to be over the age of 40.
● When the employee retires under VRS, the company must clear all provident fund and
gratuity payments due.
● Under VRS, employees are eligible to receive compensation. The amount they receive is
tax-free up to INR 5 lakhs under Section 10(10C) of the Income Tax Act, 1961. However,
to enjoy this benefit, the employee must file the claim in the same assessment year in
which they received the compensation.
● Companies need to offer assistance, such as tax consultation and counselling to smoothen
the retirement process.
● Employees who retire cannot join another organisation that belongs to the same
management or organisation.
● When an employee opts for VRS, the company cannot fill their vacancy.
What Are the Benefits of VRS?
When it comes to VRS, both employers and employees can benefit. Let’s take a look at the
advantages of the voluntary retirement scheme:
First and foremost, VRS offer companies an empathetic way to relieve employees of their duties
while improving their economic efficiency.
As the name suggests, the scheme is voluntary. Nobody can force the employees into opting for
early retirement. Additionally, the entire process is very transparent. So, the trade unions do not
object to it.
At the time of retirement, the employee receives all the benefits and dues they are owed. They
can use these funds to pursue other interests or even start their own business.
Finally, whenever a company offers VRS, it must comply with all the regulations laid out by the
Industrial Disputes Act, 1947. So, employees are guaranteed transparency and fair settlements.

Employee Engagement
Employee engagement is a human resources (HR) concept that describes the level of enthusiasm
and dedication a worker feels toward their job. Engaged employees care about their work and
about the performance of the company, and feel that their efforts make a difference. An engaged
employee is in it for more than a paycheck and may consider their well-being linked to their
performance, and thus instrumental to their company's success.
Understanding Employee Engagement
Employee engagement can be critical to a company's success, given its clear links to job
satisfaction and employee morale. Communication is a critical part of creating and maintaining
employee engagement. Engaged employees are more likely to be productive and higher
performing. They also often display a greater commitment to a company's values and goals.
Employers can encourage employee engagement in many ways, including communicating
expectations clearly, offering rewards and promotions for excellent work, keeping employees
informed about the company's performance, and providing regular feedback. Other strategies
include making efforts to make employees feel valued and respected, and feeling that their ideas
are being heard and understood. Engaged employees believe that their work is meaningful,
believe that they are appreciated and backed by their supervisors and that they have been
entrusted with the success of their company.

work-life balance
It is the state of equilibrium where a person equally prioritizes the demands of one’s career and
the demands of one’s personal life. Maintaining a healthy work-life balance is not only important
for health and relationships, but it can also improve your employee’s productivity, and ultimately
performance.

Whistle Blowing

Workplace whistleblowing occurs when an individual reports wrongdoing in an organisation,

such as financial misconduct or discrimination. This person is often an employee but can also be
a third-party such as a supplier or customer.

Internal whistleblowing is when someone makes a report within an organisation. Often

companies implement internal whistleblowing channels for this purpose so that employees and
other stakeholders can speak up if they become aware of misconduct. Employees can also report
to their line manager.

External whistleblowing is when a person blows the whistle publicly, either to the media, police
or via social media channels. People often choose the public option if they have little faith in
their organisation’s investigation or reporting procedure, have tried speaking up internally with
no result or if there is no whistleblowing system in place.

Whistleblowing, or ‘making a disclosure in the public interest’, is when a worker reveals

information about a wrongdoing or illegal activity within an organisation that may affect others
such as the general public. This is usually to do with the actions of senior management or other
staff, but could also involve customers or suppliers.