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Exercises
Software that calculates answers to one or more of the following exercises can be found at http://hrcosting.com/hr/.
Sobriety, Inc., a marketer of substance abuse programs, is concerned about the cost of alcohol abuse among its own employees. Based on the following data, what is the productivity cost associated with employees who abuse alcohol? Among all cohorts, the productivity decrease attributable to alcohol abuse is 20 percent.
Age–Gender Cohort Number Percentage with Alcohol Abuse Problems Average Annual Earnings of Cohorts Males, 25 and under 43 7% $32,000 Males, 26–44 59 10% $49,000 Males, 45 and over 38 5% $64,000 Females, 25 and under 41 5% $33,000 Females, 26–44 64 10% $47,000 Females, 45 and over 34 7% $61,000 The following data shows turnover costs for the 4,000 employees of Hulakon, Inc., for one year. In any given year, 12 percent of the employees can be expected to quit.
Employee Group Number of Employees Individual Cost of Employee Turnover Production 250 $48,500 Clerical 175 $39,000 Management 55 $74,000 A total of 120 employees participate in the company’s EAP (62 production employees, 44 clerical employees, and 14 managers). As a result of that involvement, the following numbers of employees actually quit.
Employee Group Number of Employees Production 31 Clerical 22 Management 7 Hospitalization costs comprise $189,000, or 56 percent of the total amount annually budgeted for the EAP. What is Hulakon’s ROI for its employee assistance program for this one year?
Your firm is considering establishing an EAP, but it is unsure of which provider to select. Top management has asked you to assess the strengths and weaknesses of possible providers. Make a list of questions to ask each one.
