Would requiring small employers to provide paid sick leave to workers be good or bad for business? As more cities consider the requirement, advocates for workers and businesses make their cases.
The Philadelphia City Council on Thursday failed to overturn Mayor Michael Nutter’s veto of a mandatory paid sick leave bill, preventing the City of Brotherly Love from becoming the fifth major jurisdiction to require employers to provide ill workers with paid time off. The New York City Council recently reached an agreement on a paid sick-leave bill similar to ones found in Washington, DC, San Francisco, Seattle, and the state of Connecticut, though it has not yet voted on the measure.
As the issue draws the attention of more city and state lawmakers, debate on the effects of mandatory sick leave is heating up.
Many of these elected officials are pursuing the kinds of mandates that are going to drive up the cost of employment.
While saying these efforts are well intended, organizations like the National Federation of Independent Businesses (NFIB) and the National Restaurant Association believe the timing is not right for mandatory paid sick leave. Meanwhile, advocates for workers and families say the policy is actually good for business.
“The country’s economy is moving very slow, and small-business owners, by every measurement, are reluctant to hire anybody new,” said Jack Mozloom, a senior media manager for NFIB. “Many of these elected officials are pursuing the kinds of mandates that are going to drive up the cost of employment.”
A recent survey by the Employment Policies Institute of 165 Connecticut-based businesses—completed after the state’s sick-leave law was enacted—found that 70 percent believed it was not good for business. Of those surveyed, six companies reduced wages, 12 cut back employment hours, and 38 said they would hire fewer people as a result of the law.
“Paid leave is an expensive benefit that not every employer can afford to provide,” Mozloom said. “One of the few place employers have to control expenses is in payroll, so the result of any kind of mandatory expense is usually going to be felt most immediately by the employees themselves.”
But according to the National Partnership for Women and Families (NPWF), businesses that don’t have paid sick leave policies run the risk of incurring even higher costs.
“Without paid sick days, one worker who has to come to work sick could cause serious problems,” the group said in a fact sheet [PDF]. “For instance, a single foodborne outbreak has been estimated to cost a restaurant up to $75,000 in direct costs, including cleanup, restaffing, restocking, settlements, and regulatory sanctions.”
“With paid sick days in place [throughout the country], we may be at the tipping point in the effort to make this … policy available to millions more workers,” Debra Ness, president of NPWF, said in a statement. “When workers can earn paid sick days, our families and economies are stronger and our communities more vibrant.”
At the federal level, the Healthy Families Act would require paid sick leave nationwide. The measure has been introduced in Congress every year since 2004 but has failed to pass, according to the Washington Post.