The Cost of Late Employees

Employees who chronically run late cost more than just time.

Eight o’clock.  It’s time to start another work day.  The same few who are always early have been checking their email since they arrived.  A few minutes after eight, their co-workers begin to arrive but with little notice from others.  By 8:15 pretty much everyone is present, clocked in, logged in, or checked in.  Now it’s time for the coffee parade where virtually everyone joins the queue to the free coffee machine for the first “break” of the day.  Fifteen minutes into the day and the one thing that everyone has accomplished for sure is the coffee pot has been emptied.

What does tardiness do to a company?  Does it really make any difference to anything?  Do happy employees with relatively unstructured days truly produce more effectively?  Is widespread, chronic tardiness of any major concern to the welfare of the company or even to the welfare of the staff? 

Although not customarily acceptable in our society, chronic, minor tardiness is largely ignored in most companies, but tardiness can be a sign of significant productivity loss, of employee low-motivation or satisfaction, and of ineffective or unhealthy management techniques.

Chronic tardiness is expensive and the amount can be calculated

It isn’t all that difficult to figure approximately how much a chronically late person can cost.  Companies that sell their time, such as production operations, advertising agencies and other service-oriented companies, have developed a range of methods to quantify on-the-job time usage.

One advertising agency developed a multiplier to be applied to salaries when estimating and negotiating fee for services with their clients.  One such multiplier simply uses an employee’s raw gross salary multiplied by 2.71 to estimate time plus office space plus overhead plus benefits plus consumable materials in calculating the worth of an hour’s worth of “cost-loaded time” for charge-out purposes on fee-for-service clients.  This figure is useful in assuring a break-even point for calculating a profit for the company.  The figure can also be used to calculate the cost of lost productivity when employees are not engaged directly on a client’s project.  For example, an employee earning $60,000 per year in salary would have a charge out rate of about $78.20 per hour, “cost loaded time.” 

If that employee is 15 minutes late every day, his direct cost to the company would be $4,692 per year, based on a 48 week work-year for lost productivity.  Of course, in all likelihood, that employee would expect to see at least a $5,000 annual raise in his pay envelope for the next year (if the company’s lucky).  What a coincidence!  Management already gave it to him and just threw it away! 

Tardiness is never really acceptable in our culture.

More than any other culture in this hemisphere, Americans are more aware of time and guide their behavior by it.  We get up at the same time daily.  We eat lunch at noon.  We quit (at least want to quit) at five.  We are aware of driving times to certain, frequent destinations.  Our computers show clocks on the monitors.  Most likely there is also a timepiece somewhere else in the workspace.  Most of us wear watches and some of us even wear them to bed.  In most other countries, one is never late as one arrives when personally convenient—not when time permits.  Americans run their days with alarm clocks, PDA planners and cellular telephones that sound alerts as reminders, and co-workers reminding us if we are late or early to all the appointments we must keep during the day.  So, then, why do we set our alarm clocks so we may rise in the morning and do the things we need to do to be at work on time, and then consistently, as a culture, walk in late? 

There certainly seems to have been an increase in chronic lateness in the workplace over the past few decades.  We can blame it on many things including increasing family demands and increasing job workloads.  The truth of the matter is, we are all aware when someone isn’t “on-time” and we often tell them.  It is widely accepted that chronic lateness is a life-long habit and a very difficult one to overcome.  However, there is another side to lateness and that is that most people will be late for one simple reason—because they can!

Tardiness is not a sign of good corporate health.

Chronic lateness at a minimum is costing businesses in the United States more than $3 billion dollars a year in lost productivity, and involves over 20% of the population, according to an article in HR Magazine in November, 2005.  Clearly, as 80% of all American jobs require a high school diploma, the problem cuts across all lines—white collar, blue collar, common and professional. 

A veritable plethora of excuses can be applied to chronic tardiness.  Among them, in addition to those just mentioned, are low self-control, risk-taking or thrill-seeking personality types and poor time-management skills.  Of more concern to management, though, are anxiety, stress and pressure of extra workloads causing extra-long workdays, resentments toward management for reasons such as salary, promotions, micromanagement.  The standard we set is to be on time.  The norm is to be late and most managers seem to agree it is on the increase.

Some habits are not really habits at all.

As stated earlier, many people will arrive late and abuse the good nature of companies simply because they can.  Ignoring it, or excusing it does not help.  It’s a bit like the aging father-in-law who moved in with a couple and began driving the couple nuts because he incessantly tore strips of paper over and over again from magazines, newspapers and anything else at hand.  In desperation, the couple took him to see a psychiatrist to treat him before his odd behavior drove them mad.  Following a few minutes with the psychiatrist, the father-in-law reappeared in the waiting room apparently cured.  Finding it irresistible not knowing how this was accomplished so easily, the husband asked the psychiatrist if he would divulge exactly how he cured this annoying habit in so little time.  The psychiatrist replied, “I leaned forward and looked into the eyes of your father, gently took him by the hand and said, ‘STOP IT!!!’.”  It’s a good approach to try for breaking some apparently impossible habits such as chronic tardiness.

CBR Webclock

The CBR Webclock provides you with endless options for tracking hourly and salaried employees hours, job-costed and by department, and customized pay codes like PTO or reimbursements with a simple payroll time clock program. Payroll time clock punches can be gathered with an on-site timeclock, the online Webclock, or the Voiceclock.

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