In the United States, there are currently no federal laws mandating paid sick time. Some state governments and local municipalities have imposed laws requiring paid sick leave, and many companies and organizations opt to offer paid leave regardless of legal mandates. Yet 39 percent of private-sector employees still have no paid sick time, according to the U.S. Bureau of Labor Statistics (BLS).
In recent years, paid sick leave has become an important political issue at the county, state, and federal levels. In 2011, Connecticut passed a law mandating that employees accrue at least one hour of sick leave for every 40 hours they work. On the national level, President Barack Obama announced this past Labor Day a new policy mandating that federal contractors offer their employees at least seven days of paid medical leave.
In Arizona, the city of Tempe currently is considering a proposal that would require paid sick leave. A poll of likely voters indicated that 80 percent are in favor of such action.
Governments at every level have started paying more attention to this issue, and it’s likely that the trend will continue. Nationwide, four states, 19 cities, and one county currently have such laws on the books.
Productivity pro or con?
As more and more municipalities have enacted such laws, economists have been able to study the aggregate impact of paid sick leave policies on the business community. While it’s intuitive and sensible to worry that mandated paid leave will hinder productivity, a growing body of evidence suggests that mandatory paid sick leave actually may enhance overall productivity as well as reduce employers’ healthcare expenses because it prevents the spread of contagious diseases and helps workers who fall ill recover faster.
Paid sick leave also can be an effective tool for reducing costly turnover and retaining top performers.
Because the Connecticut law has been in effect for several years now, it’s a good example to study when trying to predict the impact of similar laws elsewhere. A report on the law indicates that there has been no discernible negative impact on the rate of economic growth in Connecticut. While economic growth continued in sectors covered by the law (e.g., the hospitality industry), economic growth slowed in sectors that aren’t covered, including manufacturing. Additionally, the report shows that abuse of paid leave policies isn’t a substantial problem: 30 percent of employees hadn’t taken any sick time that was available, and those who did take such leave used only an average of four days, approximately half the time that was available.
What you can do now.
While the impact of paid sick leave laws may not be as negative as we might fear, it’s still important to take measures to effectively manage your company’s paid leave policies:
- Make sure your policy is clear about which types of absences qualify for paid leave. Does it cover care for family members or just personal illness?
- Consider requiring employees to submit doctors’ notes to validate their absences as a way to curb abuse and reinforce the idea that paid sick leave is only for bona fide medical conditions.
- Perhaps most important, lead by example. How managers conduct themselves sets the tone for the office culture. By taking paid leave only when it’s truly needed, you will send a message that the same behavior is expected of your employees.
Kelly Boehner is a labor analyst for F&H Solutions Group. She can be reached at kboehner@fhsolutionsgroup.com.