Paid sick leave: A family-friendly innovation

Here’s a predicament that touches most of us at one time or another: What happens when you’re too sick to go to work? Or a family member is so sick that they need your care?

Among industrialized nations, only the U.S., Canada and Japan do not mandate universal access to paid sick leave. Some employers in these countries voluntarily offer it as a fringe benefit. In the U.S., according to economists’ studies, about 65 percent of employers provide it voluntarily to full-time workers. But less than 20 percent of low-income, part-time and service sector workers are covered.

Eleven U.S. states (though not Minnesota) and dozens of U.S. cities — including Duluth, Saint Paul and Minneapolis — have passed laws that require employers to offer paid sick leave. This is how it generally works: for every full-time week worked, employees earn one hour of paid sick leave that can be used or rolled over to the next year. They have the right to earn, accumulate, and take sick leave up to seven days per year.

Some economists worried that sick leave mandates might result in lower pay offers and/or lower employment. When workers take the leaves they’ve earned, employers may have to operate some days with fewer staff or find short-term substitutes. They might lower pay rates to compensate, or offer fewer jobs.

Now we have some solid answers. Upjohn Institute economists Stefan Pichler and Nicolas Ziebarth compared states and localities with paid leave to groups of jurisdictions with similar economic structures without paid leave. They probed whether wages and/or employment growth lagged those in those states and cities that had adopted paid leave. They conclude: “We do not find evidence that sick pay mandates kill jobs or systematically disrupt local labor markets.” Studying specific industries, including construction and hospitality, across these jurisdictions, they arrived at the same conclusions.

Sick leave arrangements can be an effective tool for increasing workers’ health and well-being, conclude the two economists. In a companion study, the two found a decrease in influenza-like illnesses following new state and local mandates. Why? Because workers who earn sick leave will not feel forced to come to work sick, contaminating others. You can read their research summary in Upjohn Institute’s January 2019 Employment Research newsletter.

Earned sick leave is a response to a major shift in labor force participation in the U.S. Beginning in the 1960s, higher percentages of working age women entered the labor force. Those in intergenerational households had to find new arrangements for dealing with ailing children, parents or spouses home sick or needing care.

There are no federal mandates for paid sick leave. However, the Family and Medical Leave Act (FMLA), passed in 1993, requires unpaid sick leave for up to 12 weeks for either an employee or immediate family member. Employees are eligible to take FMLA leave if they have worked for their employer for at least 12 months, worked for at least 1,250 hours over the previous 12 months, and work at a location where at least 50 employees are employed by the employer within 75 miles.

It’s not good news for employers, especially small ones, when a worker calls in sick, paid or not. Work still needs to be done. I recall when a university economist colleague came down with a bad case of hepatitis one year. The rest of us pitched in for him and taught his classes — there wasn’t any other option. We couldn’t let the students down. I’ve had secretaries and research assistants who got sick (don’t we all?) on short notice, and it takes some juggling to make up for their absences.

In our area, only Duluth has adopted paid sick leave, effective Jan. 1, 2020. It will cover employers with five or more employees nationwide. Covered workers in the city of Duluth will be entitled to accrue one hour of paid sick leave for every 50 hours worked, up to a total of 64 hours per year. Use of sick leave may be capped at 40 hours per year. This innovation makes jobs in Duluth more attractive to workers than elsewhere in our region.

Ann Markusen is an economist and professor emerita at University of Minnesota. A Pine Knot board member, she lives in Red Clover Township north of Cromwell with her husband, Rod Walli.