Coming to a City Near You: Mandated Sick Leave Benefits

More employers provide paid vacation time than paid sick leave time: 58 percent versus 52 percent, found a survey by the Society for Human Resource Management. Forty-one percent provided paid time off (a combination of vacation time, paid sick leave and general paid time off).

California became the first state to require employers to provide paid sick leave. Beginning in July 2015, employees who work at least 30 days per year must have access to a minimum of three paid sick days per year.  Tacoma, Washington passed a law requiring employers to provide paid sick leave, making it the 16th city to do so.

Mandatory paid leave could become even more widespread. According to a recent AP report, President Barack Obama is considering signing an executive order that would require all federal contractors to offer paid sick leave to their employees. According to sources, the executive order would require companies doing business with the federal government to allow workers to earn at least seven days of paid leave per year to care for themselves or a family member.

Why should an employer consider offering paid sick leave benefits? Sick or medically impaired employees are less productive than healthy ones. If suffering a contagious disease, they can spread it to others. An employee who is sick or in pain is also less alert, which could lead to mistakes, errors of judgments or lack of coordination that could cause an injury or other safety problem.

Proponents say paid sick leave prevents “presenteeism,” which a Harvard Business Review study defined as “the problem of workers’ being on the job but, because of illness or other medical conditions, not fully functioning.” A study in the Journal of Occupational and Environmental Medicine estimated that employees with chronic, contagious or other illnesses who show up and perform poorly account for two-thirds of health-related productivity losses, versus one-third for sick employees who miss work. The Harvard Business Review estimated that presenteeism “…costs U.S. companies over 150 billion dollars a year—much more than absenteeism does.”

Economic conditions have made the presenteeism problem worse, as employees hesitate to take time off for fear of losing their job. In fact, in a survey by EAP provider ComPsych Corp., 22 percent of employees see “being present” as their top priority at work, versus accomplishing their basic responsibilities or improving their performance.

Despite employer fears to the contrary, most employees will not abuse sick leave benefits. A study by the Institute for Women’s Policy Research found that the typical worker with access to sick leave benefits under San Francisco’s law used only three paid sick days during the previous year, while one-quarter of employees used none. This occurred despite the fact that San Francisco’s leave law provides up to either five or nine sick days per year, depending on hours worked.

Sick leave benefits provide all or part of an employee’s earnings if the employee is unable to work because of a non-work-related illness or injury. Sick leave typically is provided on a per-year basis, usually expressed in days, and is never insured. However, employers can buy short-term disability coverage. This type of insurance will replace a specified portion of an employee’s salary if he/she still cannot work due to a non-occupational illness after sick leave benefits run out. If you don’t currently offer sick leave and short-term disability benefits, please contact us for more information.