Paid Sick Leave Usage and Cost Impacts in the U.S.: Analyses of Current Conditions and Predicted Changes Under Proposed Federal Legislation

Hayes, Jeffrey; Hayes, Jeffrey

Between 43 million and nearly 48 million private industry workers in the United States cannot take paid time away from work to seek preventive care or to recover from being sick. Instead, these workers often have to risk their jobs or a day’s pay when inevitable short-term health and caregiving needs arise. Some cities and states are leading the way in adopting laws that give workers the right to earn paid sick days. Since 2006, paid sick days laws have passed in California, Connecticut, Massachusetts and the District of Columbia and in 16 cities from coast to coast, yet the United States remains one of the few economically advanced countries without a law providing this basic labor protection.

In February 2015 legislation was introduced in both the Senate and House of Representatives to create a national standard for paid sick time called the Healthy Families Act (S. 497 and H.R. 932.) The bill proposes to permit employees of covered employers to earn up to 56 hours of sick time that can be used for their own health needs or necessary family care; it also allows employees who are, or whose family members are, victims of domestic violence, sexual assault, or stalking, to use time away from work to receive treatment and to take the necessary steps to ensure their protection. One hour of sick time is earned for every 30 hours worked. When sick time is used, small employers (those with fewer than 15 employees) may choose to provide unpaid leave; larger employers would pay the workers regular wage for qualified time taken.

In March the Senate passed a nonbinding budget resolution in support of paid sick days with bipartisan support and a total of 61 Senators voting in favor.

The authors examine existing data sources to describe the current levels of access to paid sick time and patterns of usage by workers. Different data sets provide a variety of levels of access and different usage patterns depending on whether they are collected from employers or employees, and differ on how different types of leave are counted, and the reasons for needing leave.

Simulation models of current levels of leave use and characteristics of leaves taken (duration, wages paid, wages lost) and what would be expected under a policy such as the Healthy Families Act will be estimated and compared. Leave taking and cost impacts will be examined from the perspective of both employers and employees. The simulation model employed estimates leave taking behaviors using the Department of Labor Family and Medical Leave survey and applies the parameters of the behavioral models to the Current Population Survey Annual Social and Economic Supplement to estimate the costs of leave. The results will allow a comparison of the current costs being shared by employers and employees with the costs under the policy proposed. The distribution of costs across different types of employers and employees currently and expected under a new policy will also be described.

Association for Public Policy Analysis & Management

Panel Paper: Paid Sick Leave Usage and Cost Impacts in the U.S.: Analyses of Current Conditions and Predicted Changes Under Proposed Federal Legislation