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Myth vs. Fact: Paid Sick Days

Women for Paid Sick Days Rally

SOURCE: AP/Richard Drew

Ai-Jen Poo, center, Executive Director of the National Domestic Workers Alliance, reads her statement at a Women for Paid Sick Days rally on the steps of New York's City Hall on Wednesday, July 18, 2012.

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Critics of paid sick days argue that additional benefits for employees mean greater overhead for businesses and, consequently, fewer jobs. But these claims are both oversimplified and off-base. Below are the most common misconceptions about paid sick leave—a vital policy that more than 40 million American workers still lack.

Myth: Paid sick days hurt businesses.
Fact: Businesses would be the greatest beneficiaries of paid sick days.

Critics are fond of saying that paid sick days will be bad for businesses, but it’s just the opposite. Paid sick leave policies strengthen worker loyalty, increase productivity, and reduce turnover. In San Francisco, which was the first city to pass paid sick leave legislation in 2007, two-thirds of employers are supportive of the city’s ordinance.

Workers who do not have access to paid sick days, moreover, are one-and-a-half times more likely to go to work sick with a contagious illness, putting their co-workers or customers at risk.

“Presenteeism,” the decreased productivity of an employee who works sick, is also a serious concern for more than half of U.S. employers. And with good reason: The cost of presenteeism in the United States is $160 billion each year, surpassing the cost of absenteeism.

Myth: Paid sick days will slow economic growth and eliminate jobs.
Fact: Research based on San Francisco’s experience clearly demonstrates this policy does not harm economic growth or stunt job creation.

Since San Francisco enacted its Paid Sick Leave Ordinance, job growth has been higher there than in surrounding municipalities, including in industries most likely to be adversely affected by the legislation, such as food services and retail. The real threat to jobs is that 23 percent of adults nationwide report either being threatened with termination or being fired for taking time off when they or a family member are sick.

Myth: The overhead for paid sick days is too high.
Fact: It’s affordable, and businesses save on turnover costs by having a policy.

In San Francisco, 85 percent of employers did not experience any loss of profits after the city adopted a Paid Sick Leave Ordinance. Another study conducted by the Economic Policy Institute examined the potential costs of paid sick leave to Connecticut business owners. It concluded that if employees in Connecticut used 2.41 days of leave (the national average), the direct cost to businesses would be only 0.19 percent of total sales.

Businesses can retain employees and save money by implementing workplace policies like paid sick leave and paid family and medical leave. Companies typically pay about one-fifth of an employee’s salary to replace that employee. Adopting worker-friendly policies that reduce turnover makes sense for every business.

Myth: We can’t afford paid sick days now.
Fact: We can’t not afford paid sick days now.

As wage growth has stagnated, benefits such as paid sick days have become all the more important to ensuring workers can stay out of poverty and in the middle class. For the average family, missing work for just three-and-a-half days results in lost wages equivalent to an entire month’s grocery bill. In the past year, 42 percent of parents of children age 6 or younger have missed work to care for a sick child. One-third of parents of children in child care worry about losing their pay or their job to care for their child, and the same proportion worry they do not have enough paid sick leave at all.

More broadly, lack of access to earned sick time perpetuates job insecurity and inequality, both of which harm economic growth, especially as our economy struggles to regain momentum. Only 15 percent of workers in the bottom fifth of weekly earnings currently have paid sick days.[1]

Myth: Workers will take advantage of paid sick days and abuse the policy.
Fact: No evidence supports this assertion.

To begin with, only half of workers who have access to paid sick days use any of them. Compared to those without paid leave, covered workers take only one more sick day per year on average for illness.

Myth: We don’t need any paid sick leave.
Fact: Many of the workers least likely to have paid sick days are those who care for our families and loved ones in child or elder care facilities and schools.

Providing paid sick days helps protect those benefitting from these services while cutting down the spread of infectious disease and reducing emergency health care costs for all Americans.

This is also important for other low-wage workers, many of whom work at retail stores, hotels, and restaurants, where they come into direct contact with the public. A shocking 86 percent of employees in the food service industry do not have paid sick days.[2]

Remember that stable, secure jobs with benefits and good pay are all critical to creating the consumers and demand that drive our economy. As long as millions of Americans are forced to choose between staying home to care for themselves or their family, forgoing pay, or risking losing a job, businesses and individuals alike will suffer.

Jane Farrell is a Research Assistant for the Economic Policy team at the Center for American Progress.

See also:

Endnotes

[1] Calculations from the 2011 American Time Use Survey. For more info, see: “American Time Use Survey,” available at http://www.bls.gov/tus (last accessed November 2012).

[2] Ibid.

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