Absenteeism: Meaning, Rate Formula & Indian Law

What Is Absenteeism?

A single missed day is an absence, while a pattern of unplanned missed days is what HR teams track.

Absenteeism is an employee’s repeated, unplanned absence from scheduled work, without approved leave or a good reason. No Labour Code uses the word. In India, the Model Standing Orders, 2026, made under the Industrial Relations Code, 2020, treat habitual absence without leave as misconduct where 300 or more workers are employed.

How to Calculate the Absenteeism Rate

The rate shows what share of scheduled work was lost to unplanned absence:

Absenteeism rate (%) = unplanned absent days ÷ scheduled working days × 100

For a team, scheduled working days means each person’s rostered days added together. Before you divide, sort the month’s days:

• Count: days someone was rostered to work and did not come, with no approved leave
• Leave out of the top line: approved leave, paid or unpaid, so it does not look like a problem
• Leave out of both lines: holidays and week-offs, because nobody was due to work
• Half days: count them as 0.5 if your policy marks them that way

Our guide to calculating attendance percentage shows how one month can give three different answers depending on what you divide by.

Absenteeism vs Approved Leave

The line between them is permission, not the reason. The Model Standing Orders deem a worker absent if they fail to attend duty without written permission. A sudden sick day, reported and approved as leave, is not absenteeism.

Absenteeism Example

The packing floor of a biscuit factory in Mumbai (an example) has 40 packers in September 2026. With Sundays off, each is rostered for 26 days.

Note: this is an invented example for illustration only. The factory, headcount and days are made up.

Here 47 ÷ 1,040 × 100 gives 4.52%. Count the 31 approved days as well and the rate jumps to 7.50%, which blames the floor for leave the factory granted. One packer missed 6 of her 26 days without leave, a personal rate of 23.08%, so that is where the conversation starts.

What Indian Law Says About Absence

Where 300 or more workers are employed, the Model Standing Orders apply until the employer’s own standing orders are certified. They draw two lines:

1. A worker who habitually reports late or stays absent is liable to a wage deduction under the Code on Wages, 2019.
2. Habitual absence without leave or without sufficient cause is misconduct.

Any penalty follows the enquiry the standing orders set out. Below 300 workers, the appointment letter and your state’s shops and establishments law usually set the rules instead.

Whatever the headcount, a deduction for absence has a ceiling. Section 20 of the Code on Wages allows it only for the absence, and never in a larger proportion than the time missed. Our guide to leave without pay works through the maths.

Finding the Cause Before the Penalty

A deduction recovers the day, not the employee. Repeated absence usually has a reason behind it: illness, a family member to care for, a long commute or night-shift fatigue.

What catches employers out is the pattern they never looked at. A hospital whose night nurses miss more days than the day shift, or a call centre whose absences cluster on Mondays, has a cause to look into. The safer habit is to raise the dates in a conversation first, and in writing only if it carries on.

See Every Absent Day in One Report

To act on absenteeism fairly, you need each person’s absent days counted separately from their approved leave.

Attendo (formerly Petpooja Payroll) is a complete workforce management system for every kind of business. Its Muster Report lists Full Days, Half Days, Absent, Week Off, Leaves and Holidays for each employee, and its Attendance Master report shows the day-by-day status behind those totals.

To see that split for your own team, explore Attendo.

Frequently Asked Questions