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San Francisco and Washington, D.C., are two cities that have successfully mandated businesses offer paid sick days to workers. Can it work on a state or national level?
By Eve Tahmincioglu
msnbc.com contributor
updated 6/5/2011 7:18:27 PM ET 2011-06-05T23:18:27

Jennifer Piallat, owner of Zazie Restaurant in San Francisco, initially opposed a bill proposed that would require businesses in the city to offer paid sick days to employees.

“I thought it was going to become paid hangover days,” she quipped, adding that she estimated it would also cost her $30,000 a year, a big hit to her bottom line.

But nearly four years since the law was first adopted Piallat is pleasantly surprised.

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“We’ve not had people taking advantage of it at all,” she said, referring to her 32 employees. And the program has actually cost her less than $2,000 a year.

San Francisco and Washington, D.C., are two cities that have mandated businesses offer paid sick days to workers, and the two towns are often used as examples of how the requirement has been effective with little impact on businesses. But can it work on a state or national level?

Connecticut became the first state in the nation to adopt mandatory paid sick days for employees throughout the state, and it could have a ripple effect on the rest of the country.

“We’re seeing momentum for paid sick days all around the country,” said Marilyn Watkins, policy director for the Economic Opportunity Institute.

Indeed, Massachusetts is now considering a bill to give workers seven paid sick days, and a host of other cities — including Philadelphia, Denver, and Seattle — are looking to put in place similar legislation. On a national level, Rosa DeLauro, D-Ct., and Sen. Tom Harkin, D-Iowa, last month reintroduced a bill called the Healthy Families Act. It has been circulating through Congress for several years.

“The Healthy Families Act is a worthy and important piece of legislation that I believe has a good chance of becoming law-that is why I have introduced it each year since 2004,” said Congresswoman DeLauro. “The incredible progress that has been made in Connecticut on guaranteeing paid sick days for all workers shows the momentum that is gathering at the state level, and I hope that this movement forward will help to propel the federal legislation as well.”

Labor advocates say mandating paid sick days would be a boon for workers, while business supporters see it as another stumbling block for companies trying to survive in a tough economic environment.

“Today is the worst possible time to add one more thing,” said Kia Murrell, assistant counsel for the Connecticut Business & Industry Association, or CBIA, pointing to the state’s loss of 15,000 businesses since 2008, the second-highest number of closures in the nation.

“It’s one more nail in the proverbial coffin,” Murrell said.

Vicki Shabo, director of the work and family program for the National Partnership for Women & Families, counters that “a growing number of working families are under economic pressure. People in upper income jobs already have position with sick day but for more than 40 million people that’s not the case,” she said.

The United States is one of the only industrialized nations in the world without required paid sick time for employees. Liberia, Papua New Guinea and Swaziland don’t have it either. Some states, including California and New Jersey, have passed paid family leave legislation, but those laws are limited and don’t mandate that employers pick up the tab.

Only about half of all U.S. workers in the private sector even get paid sick time.

A report by the University of Chicago has found that:

“While 64% of workers report being eligible for paid sick days, only 47% of workers receive paid sick days that they can use either for their own illnesses or to care for sick family members, 36% have paid sick days specifically rather than just PTO (paid time off) days, and only 28% have paid sick days rather than just PTO and can use it both for their own illnesses or to care for their children and family members.”

Where the health insurance is

The numbers are even worse for low-wage earners. According to a report by Economic Opportunity Institute, individuals who make above the median hourly wage get paid sick leave, while only 19 percent of the bottom 10 percent of earners get the paid time off.

Among those less likely to have paid leave are restaurant workers, nursing and home health aides, and child-care workers, said Shabo. She sees paid sick days as not only an economic issue, but also a public health issue because individuals who go to work sick could spread their illnesses.

“This has a huge impact on all of us,” she stressed.

But will the impact outweigh hardships businesses may face as a result?

One small business advocacy group, the National Federation of Independent Businesses, estimates the law in Massachusetts “may require overtime, hiring temporary workers, and additional training costs. For the state’s economy, it means the loss of 50,000 jobs, with 28,000 of those coming from the small business sector (companies with less than 100 employees), and the loss of $10 billion in economic activity.”

Indeed, businesses successfully squashed paid sick day ordinance that was overwhelmingly adopted by voters in Milwaukee in 2008. A state bill to nullify the local ordinance was signed into law by Gov. Scott Walker last month, who told the Milwaukee Journal Sentinel that “patchwork government mandates stifle job creation and economic opportunity.”

Dana Schultz, an organizer for 9to5, National Association of Working Women Wisconsin Chapter, which was instrumental in introducing the ordinance, said the group is looking at its legal options to fight the law. The measure would have had minimal impact on businesses, she maintained.

While the impact may not have been big in cities, states may be another story, said the CBIA’s Murrell.

“When you look at the two cities, San Francisco and DC, they are relatively small cities, so we don’t think they’re the best example,” she explained. New York City, she added, which is significantly bigger, considered a similar paid sick day law and decided the economic impact would be too great.

A CBIA estimate puts the cost of one hour of paid sick time weekly for a company with average wages of $10 an hour and 50 employees at $20,000 annually.

One report found a national mandate would do more good than harm.

Last year, Congress’ Joint Economic Committee released a report assessing the impact of the Healthy Families Act that would require such time off, and estimated that the Act would give to at least 30 million more U.S. workers access to paid sick time and would most benefit “vulnerable workers, including lower-wage workers, women, and minorities.”

Piallat of Zazie Restaurant has found that her kitchen staff, in particular, have benefited from the paid sick days, even though she still finds she has to encourage them to take the time off. They don’t get tips, and many of them wouldn’t take a day off unless they were on their deathbeds, she said.

Piallat wasn’t big on the sick day requirement at first, but now she believes keeping her workers happy is one of the main reasons she’s been successful. She provides her employees full health and dental benefits, a 401(k) with a 4 percent match and two weeks paid vacation after three years.

“People are valuable,” she said. “Keeping my staff is valuable and keeping them happy and healthy is valuable. We have some of the lowest turnovers in the city, and the lowest food costs and biggest profit margins.”

Eve Tahmincioglu writes the weekly "Your Career" column for msnbc.com and chronicles workplace issues in her blog, CareerDiva.net.

Vote: Vote: Should businesses offer paid sick days to workers?

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