Businesses lose money when employees are absent due to sickness. It can be beneficial for companies to calculate the total cost of the loss over the course of a year. If the cost has risen from the previous year, the company may determine it is worth implementing some wellness programs that will promote a healthier lifestyle, leading to less absences due to sick days in the future.

Formula #1

Add up the number of sick days that were taken by all employees over the course of one year.

Find the average daily salary among all employees. This is done by adding all of the employee daily salaries together and dividing by the total number of employees. For example, if a company had three employees that made $75, $100 and $50, then the average daily salary would equal $75 ($75 plus $100 plus $50 divided by three).

Multiply the total number of sick days taken by the average daily salary to find the total cost the company incurred as a result of employees calling in sick.

Formula #2

Add up the number of total absences taken throughout the year.

Divide the total number of absences by the total number of employees you have on your payroll. This will give you an average number of sick days taken for each employee. For example, if you have 100 employees and 300 sick days, then each employee would average a total of three sick days.

Multiply the number of sick days by the employee's daily salary. Do this for each employee separately (since not all employees make the same salary) to see the total cost due to sickness absence for each person.

Add the total sickness cost accrued by each employee due to absences to find the cost the company incurred for the entire year.


You may want to take a look to see if certain months of the year produce more absences due to illness than others. For example, if you see that more employees were out sick with the flu in January, you could set up a free clinic at the end of December for your employees to receive flu shots.