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Mandatory Paid Sick Leave Poised for First Test

January 17, 2007
Related Topics: Health and Wellness, Latest News
California will lead the rest of the country into new employment benefits territory in February when a San Francisco ordinance mandating paid sick leave goes into effect.

Approved by 61 percent of voters in November, it requires local companies to provide up to nine sick days annually.

On Capitol Hill, meanwhile, Sen. Edward Ken­nedy, D-Massachusetts, has put a paid sick leave measure on the agenda of the Senate Health Education Labor and Pensions Committee, which he now chairs. The measure is part of the committee agenda introduced in November.

Kennedy’s measure would require all employers with at least 15 workers to offer seven sick days annually to full-time employees to care for themselves or a family member. It would also cover those who work between 20 and 30 hours each week.

The San Francisco law is more expansive. It applies to all workers and allows them to designate a non-family member for care.

Companies may run into technical and logistical compliance problems. Ma­ria Anastas, a partner at Davis Wright Tremaine in San Francisco, says some of her clients hire varying numbers of temporary workers each month.

“It could become an administrative nightmare,” she says. “It can get fairly confusing. Many employers have computerized payrolls that are not compatible with the obligation to keep track of sick leave hours.”

A sick leave focus also undermines flexible leave policies that give businesses more staffing certainty.

“Mandated paid sick leave is at counter-odds with a paid time off program,” says Vicki Schweitzer, senior vice president of Aon Consulting’s health and productivity practice. “Encouraging last-minute sick calls is burdensome. An unscheduled absence is much more costly for an employer than a scheduled absence.”

But a study by the Institute for Women’s Policy Research asserts that San Francisco companies will save $46 million annually because sick leave will reduce turnover and curtail the spread of colds and flu. The organization puts the costs of the ordinance at $33 million for wages, payroll taxes and administrative expenses.

National political momentum is building for paid sick leave, which is not available to nearly half of U.S. workers, according to the women’s organization.

“This is the next worker issue after minimum wage,” says Deven McGraw, COO of the National Partnership for Women and Families. “People are starting to understand the predicament that low-wage workers in this country face.”

But providing paid sick leave has to be balanced with international competitive demands that are driving some jobs overseas, Schweitzer says. “You’ve added to the cost of delivering business domestically.”

Mark Schoeff Jr.


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