Tesla Just Implemented a Strict Attendance Policy, Should You?

July 17, 2018 |

Elon Musk has been in the news quite a bit lately.  While I’m not in any position to weigh in on his controversial mini-submarine, I am going to do just that on the controversial attendance policy Tesla just rolled out.  Extra shout out to Wisconsin employers:  a recent court opinion just gave Wisconsin employers an added incentive to adopt attendance policies.  More on that, below.

We work with employers every day to update Employee Handbooks and stand-alone policies, including attendance policies.  As we’ve discussed before, well-written and consistently applied policies are crucial tools for employers.  Because they follow a specific, prescribed, and generally non-negotiable process, so called “no-fault” attendance policies can an appealing option for employers.  Should your organization implement a “no-fault” policy?

What is a “no-fault” attendance policy?
A no-fault attendance policy assigns points (also called steps or occurrences) each time an employee commits an attendance-related infraction.  If an employee incurs a specific number of points, progressive discipline is automatically issued.  When initially drafting a policy, an employer can determine how strict its approach will be.  This varies based on:

  • The employer’s definition of an infraction:  For example, Tesla assigns a 1/2 point if an employee is just one minute late or leaves one minute early.  That’s (obviously) a pretty strict approach.  A more lenient employer may choose to not assign any points unless an absence exceeds 15 minutes.
  • The correlation of points to discipline:  Here again, Tesla’s policy is quite strict.  It does allow for multiple coachings/verbal warnings before any written documentation is required.  But, termination is warranted at 4.5 points.  In comparison, some employers’ no-fault policies don’t call for any discipline until 3 points and termination occurs at or above 9 points.
  • The “expiration” of points:  Tesla uses a rolling six-month period.  Other employers use a rolling 12-month period.  This approach is more employee-friendly and rewards corrected behavior.  But, it can take away some of the administrative benefits of a no-fault policy and may result in a policy that ultimately fails to correct behavior.

What are the pros and cons to a “no-fault” policy?

As we’ve discussed, there are some great advantages with a no-fault attendance policy.  They’re relatively easy for employees, managers, and HR to understand.  While accurate tracking must occur, administration is straightforward.  They’re generally effective at deterring attendance problems.  And, if properly written to comply with federal and state laws, they can reduce an employer’s risk related to claims of discrimination because such policies mandate consistent treatment of all employees.

As you may have deduced from the bold, red font, that’s a big “if.”  Policies that aren’t drafted or implemented to specifically address an employee’s right to time off under the FMLA, the ADA, and state-specific leave laws will increase compliance risks rather than decrease them.  Policies must be written, and managers/HR trained, to ensure that employees aren’t deterred from or disciplined for taking time they’re entitled to under the law.

And then, there’s the question of employee relations.  If attendance is a problem for an organization, what is the most effective way to correct the issue?  A no-fault policy might be the best solution.  But, employers should consider:

  • Vacation/personal time policy:  If the employer has one, does it work well?  If the employer doesn’t have one, could one be implemented to encourage planned rather than unplanned absences?
  • Sick time policy:  Some states require paid or unpaid sick time.  In states where sick time isn’t required, an employer should consider whether a sick time policy could encourage employees to use time as needed and in compliance with notification procedures, while also helping employers operate despite absences.
  • Attendance incentives:  Is the carrot more effective than the stick?  Some employers provide attendance-based cash bonuses, other perks like extra PTO, or even pizza and ice cream parties.
  • Wellness programs:  Chronic illnesses, both physical and psychological, impact attendance and productivity.
  • Overall morale:  Not surprisingly, absenteeism is less prominent in workplaces with good morale and more prominent where employees are dissatisfied.

Another “Pro” for Wisconsin Employers

In June, the Wisconsin Supreme Court issued a decision in which it concluded that an employee may be denied unemployment benefits if the employee was terminated pursuant to a written attendance policy, even if that policy is more strict than Wisconsin’s statutory standard.  Wisconsin’s unemployment law states that an employee will be barred from collecting benefits if the employee was terminated for “misconduct.”  The law defines misconduct as including more than 2 occasions of absence within the 120 days before the termination.  In the recent decision, the Court’s upheld the Wisconsin Department of Workforce Development’s decision to deny unemployment benefits to an employee who was terminated after a single absence, pursuant to the employer’s written attendance policy.  For Wisconsin employers, an attendance policy can not only decrease absenteeism, but can also decrease unemployment benefit expense.


If you would like to implement an attendance policy, or have questions about your existing policy, please reach out.


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