Small-business owners split on paid sick time
More laws requiring it popping up
NEW YORK – Two months after a severe flu season forced millions of workers to stay home, paid sick time is becoming an issue for many small-business owners.
City councils in Portland and Philadelphia earlier this month approved laws requiring employers to give their workers paid sick leave. And two Democratic lawmakers introduced a bill in Congress that would make paid sick leave a federal requirement.
There’s a great divide among business owners over the issue. On one side are opponents who say paid sick time creates financial and administrative burdens for businesses that are struggling with a still recovering economy and uncertainty about health care costs and federal budget cuts. Others argue that it makes for a happier workplace and encourages employees to stay home instead of coming to work and infecting everyone around them.
“It increases morale, it increases loyalty, it provides a much safer work environment,” said Andy Shallal, owner of Busboys and Poets, a chain of four restaurants in the Washington D.C., area. He was already giving his workers paid sick time before the Washington City Council passed a sick leave law in 2008. It’s particularly important in the restaurant business that sick employees don’t come to work.
“It’s gross. Nobody wants to have anyone preparing their food when they’re sick,” Shallal said.
A lot of Americans get paid sick leave, including many who work at small businesses. A study issued in July by the Bureau of Labor Statistics found that 66 percent of small businesses, those with up to 499 workers, provided paid sick leave. Among companies with fewer than 50 workers, half provided leave. Eighty-two percent of workers at companies with 500 or more employees have paid sick leave.
Lawmakers have been stepping in to get paid sick leave extended to more workers. San Francisco is widely believed to be the first major city to enact a paid sick leave law. The law, which requires that sick time be given to all workers, took effect in 2007. Since then, Washington, Seattle and Connecticut have enacted laws, and Portland’s City Council passed its bill on March 13. The laws aren’t identical, but all generally provide for workers to accrue sick time and to also use it for family illnesses and some types of emergencies.
Paid sick leave has run into roadblocks in other cities. Philadelphia’s City Council passed its bill March 14, but Mayor Michael Nutter vetoed a similar bill in 2011. He hasn’t decided yet whether he’ll sign the latest bill, spokesman Mark McDonald said. In Milwaukee, voters in 2008 approved a referendum creating a paid sick leave ordinance, but it was nullified by a subsequent state law that banned local governments from enacting such laws. And in New York City, a sick leave law has stalled in the City Council.
Opponents of mandatory paid sick leave say that it will hurt small businesses. Some also argue that the government shouldn’t intrude in the relationship between companies and their workers.
“Any time you have a government mandate on small businesses, that takes away their options, their flexibility,” said Andy Markowski, director of the National Federation of Independent Business in Connecticut, where a mandatory sick leave law took effect early last year. “With paid sick leave, a business might not be able to afford a benefit package that has benefits that are generous.”
It’s too soon to tell what impact the Connecticut law is having on businesses, Markowski said. But he also notes that the sick leave law is one of many sources of uncertainty for companies in the state – they’ve also had to contend with state tax increases and they’re still waiting to see how the health care law will affect them.
Among the consequences cited by opponents of paid sick time: Companies will have to pay overtime to replacement workers, financially strapping businesses that are already struggling in an uncertain economy. The added expense will prevent them from expanding or hiring other workers. Keeping track of accrued sick time will force an owner or another employee to take time away from other tasks.
Those issues are likely to be raised in Congress, where Rep. Rosa DeLauro, D-Conn., and Sen. Tom Harkin, D-Iowa, have reintroduced the Healthy Families Act, which would require that workers be allowed to earn up to seven days of paid sick time a year. DeLauro has introduced such a bill in every Congress since 2004. In the last Congress, the bill didn’t make it to the House floor.
DeLauro expects opposition from small businesses, but she notes that companies with fewer than 50 employees will be exempt.
“This is not only helpful for workers, but smart for employers,” she said in an interview with the Associated Press. “It reduces turnover, increases productivity and prevents the spread of illness.”
A study by the federal Bureau of Labor Statistics issued last month showed that workers generally take few sick days. Those in industries including financial services, information, transportation and professional services took an average of about four sick days a year. Those in the leisure, hospitality and construction industries took about two days.
Many small company owners say paid sick time is good business.
“We, like many bookstores in the country, do not pay exceptionally well,” said Bradley Graham, owner of Politics & Prose in Washington. “We’re very happy to be able to offer additional compensation to the staff in the form of paid sick leave.”
Fears that businesses won’t be able to grow if they have to pay for sick time are groundless, said Shallal, the Washington restaurant owner.
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