An employee attendance policy is a company document, often part of your handbook, that clearly defines general attendance and related matters at your company. Employee attendance policies should also include how employees may be disciplined for violations.
We created an attendance policy template that you can download and customize based on your business’s needs.
7 Sections to Include in Your Attendance Policy
When your employees take approved time off or have an excused absence, that’s just a cost of doing business. But controlling costs from unexcused absences can help improve your bottom line and increase employee morale. To make sure you have an effective, fair, and legally compliant attendance policy, here are the most important sections to include.
You don’t have to include a separate definitions section, though I’ve seen many policies do so. It’s more straightforward, however, if you define the terms used at the beginning of each section. This will help ensure everyone agrees and there’s no ambiguity about what any terms mean. Ambiguity leads to confusion, which can leave employees frustrated and unsure of when they violate a policy.
Your company can combat absenteeism patterns by implementing a clear and concise attendance policy. It might seem overly formal in some small businesses, but as you’ll see, a good employee attendance policy serves to benefit both the employer and the employee.
Define absence as the failure of an employee to report to work at the scheduled time. Then, define two types of absences:
- Excused absence: When an employee schedules time off with their manager and per company PTO policy, or when an employee has an emergency and provides their manager notice before the start of their shift
- Unexcused absence: When an employee fails to report to work on time and does not contact their manager or supervisor before the start of their shift, regardless of the reason
Now, you want to define the consequences of violating this policy. You may say that more than three unexcused absences in a rolling thirty-day period will result in employee discipline, up to and including termination. You could also require that employees who have an unexcused absence will have PTO automatically deducted from their balance.
Defining these terms and the consequences are important to make sure your employees understand the expectations you have for them. Without clearly setting these guidelines, you may find that you’re constantly understaffed because some people just don’t show up.
Did You Know?
According to the U.S. Bureau of Labor Statistics (BLS), the 2020 absenteeism rate across all industries was 3%. The Center for Disease Control and Prevention reports that chronic health conditions alone cost employers over $35 billion per year because employees miss days at work unexpectedly. This doesn’t even account for employees who overslept, missed the train, or got stuck in traffic.
Start by defining the term of what is tardiness at your company. We suggest adding a period as well, so it might look something like this:
Tardiness occurs when an employee is late for the beginning of their shift, or late after returning from a break in their shift, of more than five minutes. In each instance, the employee must notify their manager that they will be late by the start time of their shift. Notifying a manager does not excuse the tardiness.
Then, determine what consequences you want for violations. You could say that violations of this policy in excess of five times per month will result in disciplinary action, up to and including termination.
It’s important to hold your team accountable when they’re not on time. Your business requires your employees to be where you need them, when you need them there. If they’re tardy, work may be delayed, customers are neglected, and other employees might need to pick up the slack.
4. Early Departure
The opposite of tardiness is an early departure. Here’s sample language: Any employee who leaves a shift for the day—or for a break more than five minutes before the scheduled end of their shift or beginning of their break—must notify their manager; but the absence will be unexcused.
We suggest consequences for violations are similar to those of tardiness because they’re so closely related. This section ensures employees understand they need to stay for the entirety of their shift. Without this clear expectation, your employees might feel more freedom to come and go as they please, leaving your business in chaos.
5. Disciplinary Procedures
While we define the potential discipline for each section above, we also want to provide a clear process of how discipline occurs. This is vital because it helps keep your company out of legal trouble by applying the same disciplinary procedures to all employees. Having a structured process will make it more likely that everyone gets the same treatment.
A disciplinary process might include the following steps:
- First violation: Verbal warning
- Second violation: Written warning
- Third violation: Suspension and final written warning
- Fourth violation: Termination
6. Job Abandonment
You will want to include a job abandonment section to cover your company if an employee fails to report to work for an extended period defined by you.
Job abandonment is when an employee fails to report to work for three or more consecutive working days without notifying their supervisor. Upon these conditions being met, the employee will be considered to have voluntarily terminated the employment relationship.
This section gives your company the opportunity to get an employee off the books if they haven’t shown up to work in some time. Of course, you want to call the employee’s emergency contact list to see if they’re all right, and you should do that as soon as they don’t show up to work. But with this section, you’re now well within your rights to separate from the employee in a way that may make them ineligible for unemployment benefits.
7. Employee Acknowledgement
Often overlooked, employee acknowledgments are key pieces of any company policy. If you implement a policy that has an impact on an employee, you should have them sign the policy as an acknowledgement that they have reviewed the policy and agree to be bound by its terms.
If your company ever needs to hold the employee accountable under the terms of the policy, you have their signature on the policy in their personnel file that gives you authority to do so. Having employees sign a policy or handbook is not required by law—it’s just good business practice.
How to Create a Fair Attendance Policy
You know the big pieces of your employee attendance policy—but now you want to ensure it’s fair. The best way to make it so is to customize it to your specific business needs and culture.
Whether your employees routinely show up late, call out sick, or just clock out early without notice, the creation of an attendance policy will put them on notice that you want to change that behavior. They may not like it, and some may follow you kicking and screaming, but the right messaging and support can help.
As long as you align with your employees and overall company culture in creating this policy, you should be able to get everyone there. The best way to do that is by talking to your managers and supervisors. They’ll be the ones enforcing this policy, so get their input. If one manager lets people slide and another is strict, it sends the wrong message.
By getting your managers on the same page, you ensure fair enforcement of the attendance policy. This is key to making sure employees receive equal treatment, and your company avoid legal headaches.
Set Reasonable Expectations
Part of your discussion with managers may reveal clues about what your expectations should be. Earlier, we suggested a five-minute window for tardiness. Maybe your managers think that’s too strict and prefer 15 minutes. That’s good information to have and you might agree to adjust your policy accordingly.
For discipline, it’s also important that you are reasonable. If you decide to terminate employees after one unexcused absence, that sends the wrong message. Frankly, one unexcused absence from an employee is pretty good. You shouldn’t lose your job because you missed a day at work when you got into a car accident, for example.
So, make sure your expectations don’t have the opposite effect of your intent. Being too strict can appear as micromanagement and trying to control an employee’s personal time. This could drive employees to seek jobs elsewhere. Having more reasonable expectations shows your team that you understand that sometimes, life gets in the way and, when it does, they won’t suffer serious job-related consequences.
Compliance is often seen as a roadblock to company growth but, in reality, it’s showing you where the boundaries are to help your company grow while not triggering costly investigations from the Department of Labor or the Equal Employment Opportunity Commission (EEOC). There are many areas of employment law you need to pay attention to when creating an attendance policy, including the difference between employee classifications.
The Fair Labor Standards Act (FLSA) governs wage and hour laws, providing for a minimum federal hourly wage and overtime for non-exempt employees. Non-exempt, usually hourly employees, must receive overtime pay for any hours worked over 40 in a single workweek. You must pay them at least the current federal minimum wage of $7.25 per hour and time and a half for overtime.
Some states have higher minimum wages and also require daily overtime pay. So, check your state’s department of labor or employment website to ensure you’re paying non-exempt employees correctly.
Paying Non-Exempt Employees Correctly Under the FSLA
Some employers have a policy of deducting pay or “charging” employees when they’re late or absent. If an employee was late but still clocked hours and your company “charged” them a fee for their tardiness, that may take them below the federal minimum wage—an obvious violation of the FLSA.
Let’s say Fred was scheduled to work eight hours today, making $7.25 per hour, the federal minimum wage. Your company has a policy of fining tardy employees $10 for every instance they’re late, starting with the first instance. Today, Fred missed the first half-hour of his shift. You plan to deduct $10 from Fred’s pay today. Let’s do the math:
7.5 (actual hours worked) x $7.25 (hourly wage) = $54.38 (Fred’s total gross pay for today) – $10 (tardy fine) = $44.38 (Fred’s total gross pay today after the tardy fine has been applied) / 7.5 (actual hours worked) = $5.92 (Fred’s actual hourly wage for the day)
By “charging” Fred a tardy fee, you have reduced his hourly wage to $5.92. Your company is violating the FLSA and could face costly fines and penalties.
Let’s shift gears to exempt employees, usually salaried employees, who are not paid overtime for any work performed over 40 hours in a workweek. To qualify as exempt, however, employees must also meet other criteria, like having certain job duties and making a salary of at least $684 per week. You can find all the requirements in the Department of Labor (DOL) Fact Sheet #17A.
If an exempt employee has an unexcused absence one day this week, you might want to reduce their pay by a full day—but that’s also a violation of the FLSA.
According to the DOL Fact Sheet #17G, any salaried employee who works any part of a workweek must be paid the full salary for the week, regardless of how many hours the employee actually worked. If you decide to deduct pay, you may actually convert the employee to a non-exempt employee and be subject to back overtime pay in perpetuity.
But you have options—like creating an attendance policy. While you cannot deduct pay from the exempt employee, you can hold them accountable and, if the pattern continues, eventually end the employment relationship.
You expect employees to show up on time. When they don’t, that creates problems for the business and other employees. Emergencies happen and companies should be flexible—but within reason. Having a clear attendance policy will help you hold employees accountable to their actions while treating everyone fairly and avoiding costly employee lawsuits and government fines.
Above all, consider this: What you do for one employee, do for all. That’s the best way to keep your business compliant and keep your policies fair.