Working conditions, compensation and absenteeism

Area of Science:

• Occupational Health
• Labor Economics
• Environmental Psychology

Background:

• Employee absence is a significant concern for businesses, impacting productivity and costs.
• Understanding the drivers of absence, distinguishing between voluntary and health-related, is crucial for effective management.
• The interplay between working conditions, employee health, and absence behavior requires further investigation.

Purpose of the Study:

• To develop and test a theoretical model separating voluntary and health-related absences.
• To examine the impact of the work environment on employee health and absence.
• To investigate the hypothesis of compensating wage differentials for adverse working conditions.

Main Methods:

• Utilized a theoretical framework based on the Shapiro and Stiglitz efficiency wage model.
• Incorporated work environment factors as part of the compensation package.
• Employed a panel of quarterly firm-level data from 1990 to 1998 for empirical analysis.

Main Results:

• Empirical findings support the theoretical model, indicating incomplete compensation for certain workplace hazards.
• High noise levels, monotonous work, heavy lifting, and poor postures are associated with inadequate compensation.
• Ill health and long-term absence are not strongly linked to economic variables but are higher with frequent accidents or near misses.

Conclusions:

• Workers may suffer from ill health and increased long-term absence due to uncompensated workplace disamenities.
• Adverse working conditions, if not adequately compensated, can lead to negative health outcomes and absenteeism.
• Firms experiencing frequent accidents or near misses show higher rates of long-term absence, suggesting a link to workplace safety.