Briefing: Paid Sick Leave
Next year, Bay State residents may be asked to vote on a ballot referendum that would require companies with more than six workers to offer paid sick leave. Lawmakers have been proposing mandated paid sick time since 2005, but proposals have crumbled on Beacon Hill under the weight of business opposition. Some 910,000 Massachusetts employees — 36 percent of the commonwealth's workforce — lack paid sick days, though 329,000 of those workers have other paid-time-off benefits.
How prevalent is mandated paid sick leave?
Connecticut is the only state to require paid sick leave, though similar mandates are being considered in Vermont, Maryland, Washington and Oregon. New York City, Washington, D.C., San Francisco, Portland, Ore., and Seattle have also adopted paid sick leave policies. More than 145 countries require paid sick leave.
Why do business groups oppose the mandate?
The National Federation of Independent Businesses (NFIB), Associated Industries of Massachusetts (AIM) and the Massachusetts Restaurant Association all say that mandating paid sick time would increase payroll and administrative costs, while lowering productivity. A 2012 NFIB study found the measure would cost Massachusetts 16,000 jobs in the five years after implementation, while the state's real work output would decrease $8.4 billion. Firms with less than 500 employees would bear two-thirds of the job losses and more than half of the lost sales, the NFIB predicted. Meanwhile, AIM said the mandate would further weaken the state's competitive position in attracting new or retaining existing companies. Small profit margins and unusually high operating expenses would make the mandate particularly burdensome for food service providers, the restaurant group said.
Are there any dissenting views?
A 2012 study by the Institute for Women's Policy Research found that requiring paid sick days would actually save Massachusetts employers a combined $26 million annually. Lost wages and increased compensation and administrative expenses would cost companies an additional $198 each year, the institute predicted. But that would be more than offset by $224 million in combined savings from lower turnover and a reduced spread of flu. Paid sick days would also lower turnover by reducing work/life conflict and increasing worker loyalty, the institute said. It believes recruiting new workers plus low productivity of new hires are key costs associated with turnover.
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