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New mandates for paid sick leave raise hackles

The only thing worse than staying home sick with chills and a fever or a hacking cough is having to be at work while battling illness. Yet for many workers, especially those who work for small businesses that don't offer sick leave, that is a very real choice.

Federal law does not require business to offer paid sick leave, and increasingly small businesses are abandoning the benefit, but now some state and local governments are stepping into the breach, ringing alarm bells for some small business owners.

"People will lose jobs," said Darlene M. Miller, president and CEO of Permac Industries.

If governments mandate paid sick time, "it will ultimately make small manufacturers like my company less competitive, and reduce the work that we win in our bidding," she said in an email. 

The idea of a national mandate for paid sick leave was kicked around a few years ago in the wake of the "swine flu" scare, when many policymakers came around to the idea of paying contagious workers to stay home. But the idea never became law, and no action is expected from the current, deeply divided Congress.

But some smaller governments are acting.

Connecticut now requires companies to give full-time workers five paid sick days a year, and a law that goes into effect later this year in Seattle will require firms with five or more employees to provide paid sick leave. Similar efforts are under way in New York City, Philadelphia and Massachusetts. Proponents say these laws protect low-wage workers — and prevent them from passing contagious illnesses onto the public many of them serve. 

"It's just really difficult for someone whose earnings are just getting them by to give up just one day's pay," says Sherry Leiwant, co-founder and co-president of advocacy group A Better Balance. "It's just not going to work to say to people, 'Stay home when you're sick' if they need that money to put food on the table." 

Leiwant said 82 percent of restaurant workers and 64 percent of retail workers in New York City don't get paid time off when they're sick. This is somewhat alarming in a city where so many people encounter waiters and cashiers on a daily basis. Among all small business, defined as those with fewer than 50 employees, only 32 percent offer paid sick leave, down from 39 percent in 2009, according to the Society for Human Resource Management.

"Any mandate basically means that some other things have to go," like health insurance, raises or even additional jobs, she said. 

Darling said employees who do get paid sick time take unfair advantage of it, calling out disproportionately on Fridays and Mondays. 

Denise Fleury, senior consultant in health and benefits business at Mercer, said dealing with absenteeism is a challenge for small businesses but disputed the idea that employees take advantage of paid sick days. "When you have a smaller company, it's more of a community, so I would think abuse of sick leave would be not as prevalent as people might think," she said.

The question of how much it costs to pay sick employees when they're not at work is hotly contested. The NBGH's position statement says a national mandate for companies to provided paid sick days would cost businesses up to $35.3 billion annually. 

Other groups have come up with much lower figures. When the Economic Policy Institute calculated how much businesses in Connecticut would be affected by the state's sick-time law, it estimated the cost to be 0.05 percent of sales across all industries.

Brian Drum, CEO of executive recruiting firm Drum Associates, said an alternative is for companies to give employees a certain number of paid days off without dividing that pool into categories.

"They really don't want to have the burden of worrying about what's sick time and what's vacation," he said. A growing number of the companies already use this "paid time off" model because it's easier from an administrative perspective, he said.

But companies that don't give their workers any paid time off might need a law to compel them, he acknowledged. "To mandate it isn't a bad thing," he said. "The companies that might not do it probably ought to do it, because people do get sick from time to time."

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