Hi Friends,
                                              Even as I launch this today ( my 80th Birthday ), I realize that there is yet so much to say and do.
                                                  There is just no time to look back, no time to wonder,"Will anyone read these pages?"
                                       With regards,
                                       Hemen Parekh
                                       27 June 2013

Friday, 7 June 1985

ABSENTEEISM- PRODUCTIVITY

Synopsis: Communication For Productivity
Letters written to some 7500 Workers / Managers / Union Leaders, following a period of strike / Go slow / Murders (1979 - 1987), at Mumbai factory of Larsen & Toubro Ltd. This direct / open / honest communication led to a remarkable atmosphere of trust between Workers and Management, which, in turn, increased productivity at 3% per year (ave). 

7 Jun 1985

To:
Dear Friends                         
ABSENTEEISM
Whenever we talk  of improving our productivity,  we are also forced to talk about absenteeism.
First  thing we  have. to do  to improve  productivity is  to remain present at work.  All of you know by now that
                                         Output
Productivity     =                   Effort

But  if  we  are  absent from  our  work-place,  how  can  we possibly make any effort ?
It is only when  we are physically present  at our work-place that we can think of
Working (at all! )     
Working harder (as an individual)    
Working smarter (efficiently)    
Working as a team (effectively)
After subtracting
52    Weekly offs  and 
8     Paid  holidays
"60"
from 365 days  of the year, we can maximum  work for 305 days in a year.


But, once-in-a-while, we, 
get sick
have guests at home
wish to relax with our family on a vacation
for which we take,
Sick Leave (sl)
Casual Leave (CL)
Privilege Leave (PL) resp.
And since some of these things are  likely to happen sometime or other,  to all of  us, the Union  and the  Management have disucssed  and fixed certain  "Maximum Limits"  for different types of leave that an employee  may legitimately take during the course of a calendar year.
As long as actual leave  taken by an employee is within these maximum limits, he (or she) does not lose wages.
These limits are shown below:


1.
SL *
DR/15
Mr/15

CL
8
10

PL
27
30

Max. Total
50
55
(* 9 days for those covered under ESI)
2.  Now if an  employee were to remain  absent from work,  to the full extent of these permissible limits, he would  be     left in a year with
Working days (for DR)
250  Working days (for MR)


3.  During 1984, the average employee strength at Powai was
DR Employees   3713
MR Employees   1120
Total          4833

4.  So  multiplying, .we  had  the possibility  of  available     man-days as follows:
3713 x 255 =  9,46,815 Man days (DR)
1120 x 250 =  2,80,000 Man days (MR)
Total      =      12,26,815 Man days

This  is   2,47,250  man  days  less   than  the  maximum available mandays of (305 x 4833) =  14,74,065.
Thus  the company  stands to  loose  2,47,250 mandays  if everybody took every kind of leave to the full extent.
However, not all of us:    
fall sick for 15 days in a year    
have guests for 8/10 days in a year    
go out on vacation 27/30 days in a year.
So not all 2,47,250 man days are lost due to PL, SL, CL.
But just as many. employees do NOT use up their full quota of various  kinds of leave,  there are  a few  others  who even exceed their quota.
Of  course, they  do not  get wages  for  this "extra/excess" days  of leave.   In some  cases, the  Foreman/Supervisor may have  authorised this extra/excess leave,  if it  was applied for in advance and if he  was satisfied that it was genuinely needed.   But there  are  many cases  where  such absence  is "unauthorised loss of pay (ULOP)".
The  table below  indicates the  colossal  number of  mandays lost due to authorised and unauthorised loss of  pay leave in the financial years 1982-83 and 1983-84.
For the company,  it is a small  consolation that it  did not have to pay  wages for such authorised/unauthorised  "loss of pay leave/absence".   Compare  the figures of  wages  lost by workmen   (due  to  loss  of   pay  leave/absence)  with  the production loss  due to this  kind of leave/absence,  for the last two years.
Year
Mandays lost due to unauthorised absence & authorised loss of pay leave
Wages lost by workmen (Rs.in Crores)
Loss of Production (Rs.in Crores )
82-83
46994
0.27
4.9
83-84
44950
0.33
4.7

You will  also notice from the  above table that  in 1982-83, loss  of  46,994 mandays  due to  loss  of pay  leave/absence resulted in wage loss of  Rs.27 lacs, whereas a lesser number of mandays  due to  loss of pay  leave/absence  (i.e. 44,950) resulted in much higher wage loss (Rs.33 lacs) in 1983-84.
This reflects the increasing cost per employee per day.
But then that  is another major subject which  I have already been writing about and  more on this may be saved  for future bulletins.

H.C. PAREKH