Functions & Formulae

Each applied formula has its own function page, with a signature, implementations, and tests.

Absenteeism measurement and valuation function

v(D_a,H,w) = C

Maps the time a worker is absent from paid work because of ill health, the usual hours worked and a value per hour to the share of working time lost and to a productivity cost. The value depends on the method: the human capital approach counts the whole absence, while the friction cost method counts only the period an employer needs to restore production.

  • WPAI proportion of work time missed because of health

    A = H_m / (H_m + H_w)

    Divides the hours missed from work because of health problems by the sum of those hours and the hours actually worked, over the seven-day recall period of the Work Productivity and Activity Impairment questionnaire, general health version. Multiplying by 100 gives the percentage of work time missed. Hours missed for other reasons, such as holidays, are excluded from both terms.

  • Absence cost by the human capital approach

    C_HC = D_a / 7 * H * w

    Values every hour of absence at the value of an hour of work. D_a counts calendar days absent, so D_a divided by 7 gives weeks absent, and multiplying by the usual weekly hours and the hourly value gives the cost. The human capital approach usually values time at gross earnings including employer-paid costs such as payroll taxes and benefits, the full cost of employee compensation.

  • Absence cost by the friction cost method

    C_FC = min(D_a, D_F) / 7 * H * w * e

    Counts absence only up to the friction period, the time an employer needs to restore production, usually by replacing the worker, and multiplies the counted hours by the value of an hour and by the elasticity of production with respect to working time. Absences shorter than the friction period count in full. When the hourly value already allows for the elasticity, as the Dutch reference price does, e is set to 1.