Really, the only formula you need is "Did the player participate for more than 50 - 75% of the STF? Yes = loot. No = no loot, what you would have gotten is split among the players who did."
The idea behind his formula is to guage participation. What actions define participation? If someone sets another person on follow and engages a keyboard macro to repeatedly spam spacebar on target of target (who they are afk following)... are they then participating?
A player regulated vote to kick feature is the best option (with inbuilt safeguards naturally).