More employers are streamlining the management of employee absenteeism by shifting the administration of their leave of absence programs to internal, dedicated groups or to an outsourcing partner, according to a new Hewitt Associates survey of 225 large and mid-size companies.

Hewitt points out that a number of companies are adopting total absence management programs, which bring together traditionally separate absence-related policies and benefits programs that enable employers to gain a more comprehensive view of the driving factors behind employee absenteeism.

According to the survey, almost half (42 percent) of employers have completely centralized their LOA administration, and 30 percent have outsourced their LOA program management, an increase of 13 percentage points in the last five years. In addition, about 30 percent of employers offered a total absence management program. Among those companies that outsourced their LOA administration, 93 percent said their administration was more consistent and 76 percent reported that the distribution of required notifications was more timely.

The lack of consistent administration and ineffective program management is potentially costing companies millions of dollars every year in payroll expenses, Hewitt says. Employers reported on average that 8 out of every 100 employees experienced an LOA in a given year, with the average absence lasting about 42 days. For an employer with 20,000 employees, that adds up to a total of 67,200 days lost to LOAs each year—the equivalent of 260 full-time employees not working for an entire year—or almost $13 million lost annually in productivity, Hewitt says. The survey shows that 69 percent of the employers in the survey—have never even attempted to calculate the costs generated by employee absences.