For many Marylanders, the coming of the flu season meant much more than worrying about missing a few days of work due to bed rest or having to attend to a sick child while s/he is are out of school.
For the 70% of low-wage workers (the bottom 25% of earners) without paid sick leave, the possibility of getting the flu or caring for a sick family member means facing a painful choice. One can go to work, which can mean the worsening of the illness or abandoning a family member in need. This is a choice a majority of adults report making, according to a study done by NPR, the Robert Wood Johnson Foundation and Harvard’s T.H. Chan School of Public Health.
Alternatively, a worker can stay home and, at best, go without wages needed to pay the rent or the grocery bill. At worst, employers, armed with thousands of other applicants awaiting work, may simply dismiss a worker due to an illness-related absence, a reality that one in five low-income workers has experienced, according to Oxfam, an international confederation of charitable organizations that work to alleviate global poverty.
This new Maryland legislative session is poised to offer some relief to those who must make these difficult decisions, with both Gov. Larry Hogan and Democrats putting forth plans for a paid sick leave mandate. While Maryland’s workers will clearly benefit from such a policy, there is also a strong argument that Maryland’s business community also should be supportive.
Paid sick leave is not simply a labor-friendly policy that comes at the expense of employers who must comply with a new regulation on how to compensate their employees. Sick time is different than, for instance, requiring employers to offer paid vacation time.
If an employer decides not to provide its employees with paid vacation time, the business incurs all of the benefits of not paying workers while they are away at the beach, while also accruing all of the costs, such as not being able to attract and retain the best talent, or having to deal with a workforce with low morale.
Similar to deciding not to provide paid vacation time, there are a variety of private costs and benefits that accrue for firms who decide not to offer paid sick time. For instance, firms may benefit from saving money by not having to pay an additional worker when one is out sick.
Businesses will also absorb the cost of having sick workers come to work less productive, spreading illness to their coworkers and even exposing the business to liability by potentially making customers sick, a problem particularly acute in the food service industry.
In contrast to paid vacation time, an employer’s decision not to provide paid sick time also imposes costs well beyond his or her own business. Sick workers that choose to show up do not just put their own co-workers at risk, but may also spread illness to workers of other firms, whether it is during their everyday interaction with customers, on the bus to work or during their lunch break.
Stopping the Spread
Thus, by not providing paid sick time off and incentivizing workers to come to work when ill, employers impose large costs on other businesses and create a general public health concern. All employers have an interest in ensuring their employees are healthy and productive. For this reason, the business community should consider being in favor of sick leave policies that not only ensure employees are able to take needed time off of work without the fear of losing their job and income, but also address a larger public health issue by decreasing the spread of illness.
In this year’s Maryland legislative session, two competing visions of sick leave for the state’s workers have emerged. On the one hand, Hogan’s plan would concentrate on relatively large employers, those with 50 or more employees and mostly full-time workers; smaller businesses would be encouraged to adopt paid sick leave policies through tax deductions.
While the governor should be applauded for taking a step towards implementing this important policy, it does not go far enough. At the national level, 73% of employers with 50 or more employees already have a paid sick plan, and lower income individuals, those most in need of this important benefit, are disproportionately employed in smaller business.
The Other Side
In contrast, Democrats have put forth a mandate that firms with at least 15 employees must allow workers to earn sick time, and smaller businesses would have to provide unpaid time off. This policy is broad enough to allow the vast majority of workers access to this benefit and remove some of the more severe economic consequences lower income workers face when they get sick.
In the upcoming legislative session, Maryland will have an opportunity to join a handful of other states, along with every other wealthy country in the world, in passing a strong sick leave policy.
Jeremy Schwartz, is an associate professor of economics at Loyola University Maryland’s Sellinger School of Business and Management, which has a campus in Columbia. He can be contacted at 410-617-2919 and [email protected].