Involuntary Absence from an Organizational Point of View

Involuntary absence is often seen as an exogenous factor, but firms can take actions to reduce it. In this paper the notion that firms, especially SMEs, are faced with a single decision whether or not to undertake these actions is questioned. A firm model on involuntary absence measures is constructed and estimated in which four successive steps are distinguished. It turns out that this model is supported by the data. Furthermore a clear firm-size effect exists. Larger firms tend to take more precautionary actions than small firms because they have more attention for work- and health-related topics in general and more easily recognise the influence they can exert on the level of involuntary absence.