The Secretary at the US Department of Labor, Tom Perez, has said that the US is “distressingly behind the curve” on paid sick leave, vacation leave and parental leave. It’s certainly been no secret that the US is the world’s only wealthy nation that does not mandate a minimum for taking time off – almost four out of 10 private sector workers (or 43.5 million workers) across the country have no sick leave at all.
The lack of paid sick leave means that many workers are forced to go to work when they are ill, which can worsen their health and of those people around them. In short, getting sick makes employees choose between whether they are paid or not.
Fortunately, these sobering figures have led to a Labor Department-led campaign targeting employers to provide paid leave to their staff, tagged #LeadOnLeave. Mandated sick leave in particular has been the next battleground for workers’ rights, which has caught the attention of governments, companies and employees alike. At the state and local level, California, Connecticut, Massachusetts, and a number of cities have instituted paid sick leave policies (with California and Massachusetts mandating sick leave on July 1), while employers have also been taking initiative – Chipotle recently announced that it will offer hourly workers paid sick leave, paid vacation and tuition reimbursement – benefits that were previously only available salaried workers, while McDonald’s and Walmart have also voluntarily changed their paid sick leave policies.
In spite of the big push, detractors of paid sick leave have voiced concerns that instituting sick leave policies will adversely affect their bottom line. Managing time off can be tricky for businesses to manage – a recent survey found that 42 percent of employers lack the staffing resources to manage absenteeism. Along with the potential revenue drain that absenteeism and leave can cause, there are also concerns around employee productivity, interpretation of laws, and administrative challenges.
As California and Massachusetts mandate paid sick leave on July 1, expect additional states and cities to similarly follow suit. Here are ways that businesses can consider and prepare for adopting sick leave policies:
- Know where your employees are based and keep up-to-date with the local labor regulations and ordinances
- Preload leave balances with the minimum limit every year or start tracking employees’ time worked to know how much sick time they have accurately accrued
- Separately track sick leave accruals and usage (even if the business has an unlimited time off policy)
- Ensure that employees know how many sick days they have available (e.g. on his or her pay stub) and inform them of their rights
- Keep records of employees’ sick days for at least three years, including how many hours were earned and how many were used
- Minimize administrative costs by automating time tracking and absence management processes, which will also ensure compliance and reduce the chances for human error.
The penalties for failing to comply with the new sick leave requirements in California and Massachusetts are pretty steep (e.g. up to $25,000 per violation in Massachusetts). With labor regulations continuing to evolve at the national, state, and local levels, it will be critical for businesses to ensure that they are up to date on new labor policies. #LeadOnLeave should not be viewed by companies as simply an administrative and legal headache, but also as a way to retain employees and minimize turnover – issues that are increasingly crucial for employers vying for talent in the increasingly competitive job market.
Disclaimer: This article is not a substitute for labor law guidance or legal advice of any kind, and should not be construed as such. If you need legal advice in relation to labor compliance issues, please consult your qualified legal advisor.