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WSJ Op-ed Misses On Paid Sick Days

By Robert Drago

Since the implementation of a paid sick days mandate in San Francisco, followed by Washington DC, and most recently the state of Connecticut, the popularity of paid sick days laws is growing. This has caused concern in the business community. In the latest salvo, Michael Saltsman discussed Institute for Women’s Policy Research (IWPR) findings regarding San Francisco’s experience with a paid sick days ordinance. The piece includes numerous mischaracterizations of the facts. Interpreting the Bureau of Labor Statistics finding that 80 percent of private sector employee have “some type of leave” as making up for paid sick days (only 62 percent have that), is misleading: vacations are typically scheduled weeks or months in advance; one’s own illness or that of a child usually cannot be scheduled. IWPR’s finding that only 3 percent of employers reported that fewer employees came to work while sick needs to be balanced against the 25 percent of employees who said that they were better able to care for their own or their families’ health needs.  Among all demographic and racial/ethnic groups, black (29 percent), Latino (31 percent), low-wage (30 percent), women (27.5 percent), and workers over 55 (34 percent) were most likely to say they were better able to care for their own or their families’ health needs as a result of the paid sick days law.

The finding that 30 percent of low-wage employees reported adverse hours or layoffs effects also requires context: According to the San Francisco Office of Labor Standards Enforcement, the city also raised the minimum wage and mandated health insurance around the same time as the paid sick days ordinance, and the expense of health insurance (particularly for low-wage employers) far outweighs any conceivable impact from paid sick days. Further, the surveys were administered late in 2009 (for employers) and early in 2010 (for employees), and those were not exactly great times for the U.S. economy.

Finally, the most important piece of context missing is that the median employee in San Francisco with paid sick days reported using three days per year. For someone working 5 days per week for 52 weeks per year, that represents 1.2 percent of annual earnings. That figure is around one-twentieth the size of the  percentage increase in the federal minimum wage during and just after the Great Recession (rising from $5.85 to $7.25) and no serious economist believed that increase in labor costs had any ill effects on the economy. The ostensible “downside” of paid sick days discussed by Mr. Saltsman is in fact a mirage.

 

Dr. Robert Drago is the Director of Research at the Institute for Women’s Policy Research. Prior to joining IWPR, Dr. Drago held positions as Senior Economist with the Joint Economic Committee of the U.S. Congress and Professor at the Pennsylvania State University in the departments of Women’s Studies and Labor Studies.

Young Women Need Paid Sick Days (Too)

by Claudia Williams

While some workers lacking paid sick leave can take time off without losing pay, many lose pay when they are out sick and cannot afford to take a single day off. This is particularly the case for young women. At an early stage in their careers, many younger women workers are living day to day and others juggle multiple jobs to make ends meet.  With limited wealth and savings, a large debt from college or even a steady income, younger women often find themselves between a rock and a hard place when illness strikes. Younger women are often not in a position to take lower pay when sick, especially when medical expenses are involved.

While part-time and low-income workers’ concerns are widely discussed, the needs of younger workers are almost unheard of, as it is usually assumed that their health status—without the burdens of chronic health conditions and age—is excellent, and that they don’t yet have care giving responsibilities.

Data from the National Health Interview Survey (NHIS), however, shows that young workers need paid sick days just like everyone else. In fact, of those private sector workers that reported having fair or poor health, 30 percent were 35 years or younger and a larger portion were young women (18 percent compared to 12 percent for young men). The same data show that a majority of young workers lack paid sick days; only 37 percent have paid sick days, compared to 58 percent of all workers.

Across the board, younger workers have limited access to paid sick days, no matter what they do for living, what their schedule looks like, or the size of the business they work for. For instance, whether young workers are employed in high-end jobs like legal occupations or in lower paying occupations like  health support, data from the NHIS show that only one out of five workers with paid sick days in those occupations are  between 18 and 35 years old.

For younger workers concentrated in traditionally low-income occupations or small businesses, the picture is even grimmer. Along with part-timers, these workers are most often afflicted, and women are overrepresented in this type of work arrangement. The outlook is especially challenging for young women with care giving responsibilities on top of lower earnings: paid sick days are even more essential for them to to stay afloat. For single mothers, usually with limited resources and often living in poverty, having paid sick days can make a big difference when medical problems arise.

Paid sick days are essential to all workers, but even more so to those with limited resources, including younger workers who are more vulnerable and have fewer resources than many of their older counterparts.

Claudia Williams is a Research Analyst with the Institute for Women’s Policy Research.

Bad Economics Meet Paid Sick Days in Philadelphia

by Robert Drago

A new study for the National Federation of Independent Businesses (NFIB) estimates that Philadelphia’s proposed paid sick days legislation would cost employers between $350 million and $752 million annually. Both the factual basis and the assumptions underlying this study are seriously flawed.

The totals derive from two presumed costs: the amount for new paid sick days coverage, estimated at between 34 and 42 cents per worker hour in direct labor costs, and 38 cents per worker hour in compliance costs for employees who already have paid sick days.

Consider the new paid sick days coverage. The NFIB study assumes workers will use all of the days allowed—9 days annually for larger employers, 5 days annually for small employers. Their figures imply an estimated overall average of 8.35 days per year. However, from a recent, random sample of employees in San Francisco, which has had similar requirements since 2007, the average employee uses 3 days per year. This estimate agrees well with IWPR analysis of national data from the National Health Interview Survey (3.1 days used on average). Given the fact that workers use only 3 days per year, new sick days costs are overestimated by 64 percent in the NFIB study. The actual hourly cost range, using NFIB’s methods, is thus about 12 to 15 cents per hour.

The second source of costs is compliance expenses for employers who already offer paid sick days. Although it is not known exactly how many days most employers in Philadelphia offer at present, the Bureau of Labor Statistics estimates that the national average is 8 days per year for private-sector employees with one year of job tenure. It seems reasonable to assume that employees in Philadelphia with access to paid sick time use around 3 days per year, as do workers in San Francisco. These statistics suggest that there is likely to be little or no additional paid sick days use by employees who already have access to paid sick days. While there might be some start-up costs to bring company policies in compliance with the law, these will be a one-time cost.

The NFIB, however, claims the annual compliance costs will be 38 cents per hour for employers that already provide paid sick days. At that rate, an employer would be hiring one full-time employee at $15 per hour to track paid sick days for every 40 current full-time employees (the result of dividing $15 by 38 cents). An hour per week per employee to track sick time use seems like a serious overstatement. If the task of monitoring sick days use after passage of the proposed law took one extra hour per week per 40 employees (who already had paid sick days before the law was passed), a more realistic estimate, compliance costs would fall to about one cent per hour.

Using the NFIB’s own methods, with known facts and more reasonable assumptions, the hourly costs for new coverage drop to 12 to 15 cents per hour, and the costs of compliance for employers already providing paid sick days drop to one cent per hour. This suggests a far lower cost for implementation of the law than the NFIB study states, especially for businesses that already provide employees with paid sick days or an equivalent benefit.

It is almost enough to give one pause over the objectivity of the entire NFIB study.

Robert Drago is the Director of Research at the Institute for Women’s Policy Research.

Top 5 Recent IWPR Findings

By Jennifer Clark

When IWPR posted a “Top 5” list of our most revealing research findings in December, we were so encouraged by the level of interest our readers showed in the post, that we decided to turn it into a regular roundup. Although intending to compile another “Top 5” list, the first four months of 2011 were so action-packed that we couldn’t limit ourselves to just five. From Social Security to employment discrimination, here are the top IWPR findings from 2011 (so far):

1.       Without access to Social Security, 58 percent of women and 48 percent of men above the age of 75 would be living below the poverty line.  If you watch cable news, read reputable newspapers, or even tune in to late night television, you would get the impression that the Social Security system, which helped keep 14 million Americans over the age of 65 out of poverty in 2009, is broken. Social Security does not contribute to the deficit and is forbidden by law to borrow money to pay for benefits.  In fact, Social Security is actually running a surplus—a big one—at $2.6 trillion, an amount that is projected to increase to $4.2 trillion by 2025.

2.       Although many groups advocate for immigrant rights at the local, state, or national levels, very few advocate specifically for the rights of immigrant women. A new IWPR report, Organizations Working with Latina Immigrants: Resources and Strategies for Change, on the challenges facing Latina immigrants in the United States, explores the specific challenges faced by immigrant women—higher poverty rates than their male counterparts and greater risk of sexual, domestic, and workplace violence—and spotlights the organizations that are trying to help.

3.       The gender wage gap has narrowed only 13 percentage points in the last 55 years. With the ratio of women’s to men’s earnings stagnating at 77 percent in recent years, IWPR projected that, if current trends continue, the gender wage gap will finally close in 2056—45 years from now. In terms of how the gender wage gap breaks down by occupation, IWPR also found that women earn less than men in 107 out of 111 occupational categories, including female-dominated professions like teaching and nursing.

4.       Women’s career and life choices do not completely explain  the gender wage gap. IWPR’s new report, Ending Sex and Race Discrimination in the Workplace: Legal Interventions That Push the Envelope—a review of over 500 sex and race discrimination settlements –offers distressing evidence of the factors that keep women’s median earnings lower than men and keep women out of better paid jobs. These include discrimination in hiring, sexual harassment of women trying to work in male-dominated jobs, preventing women from getting the training that is required for promotion (or only requiring that training of women), and paying women less for the same work than men. The report finds that ensuring transparency in hiring, compensation, and promotion decisions is the most effective means for addressing discrimination.

5.       On-campus child care centers meet only five percent of the child care needs of student parents. IWPR’s report, Improving Child Care Access to Promote Postsecondary Success Among Low-Income Parents, explores the challenges facing 3.9 million student-parents, 57 percent of whom are also low-income adults, enrolled in colleges across the U.S. Costly off-campus care centers—in many states the cost exceeds median income—are unrealistic for many, leaving some student parents devoting up to ing 70 hours per  week to jobs and caregiving, leaving little time for classes or studying. Postsecondary education provides a path to firmer economic stability for low-income families, but without child care on campus, the path often seems more like an uphill climb.

6.       Both businesses and employees in San Francisco are generally in support of paid sick days, as the nation’s first paid sick days legislation sees benefits four years after passage. San Francisco’s Paid Sick Leave Ordinance (PSLO) went into effect in 2007.  Four years later, IWPR analyzed the effects of the ordinance in the new report, San Francisco’s Paid Sick Leave Ordinance: Outcomes for Employers and Employees, which surveyed over 700 employers and nearly 1,200 employees.  Despite claims from opposing groups that this kind of legislation is bad for small businesses, IWPR’s survey found that two-thirds of employers in San Francisco support the law, including over 60 percent of employers in the hotel and food service industry.

Jennifer Clark is the Development Coordinator with the Institute for Women’s Policy Research.

San Francisco Paid Sick Days Law Is a Proven Success

This is a guest post by Vicki Shabo, Director of Work and Family Programs with the National Partnership for Women and Families. It was originally published on the blog for the National Partnership of Women and Families.

A new study released today shows that San Francisco’s Paid Sick Leave Ordinance (PSLO)—the first citywide paid sick days standard in the country—has been proven a success. The report, San Francisco’s Paid Sick Leave Ordinance: Outcomes for Employers and Employees, released by the Institute for Women’s Policy Research (IWPR), includes the results of a survey of nearly 1,200 workers and more than 700 employers in San Francisco. The findings are overwhelmingly positive for workers, businesses and the public—adding further evidence that policies that help working families meet their responsibilities at work and at home are good for everyone.

Sixty-one percent of San Francisco voters approved the city’s paid sick days law in 2006 despite the business lobby’s fierce campaign against it. Under the law, workers in smaller businesses can earn up to five paid sick days per year while workers in larger businesses can earn up to nine. Workers can use the sick time to recover from their own illness, care for a sick family member, or seek routine medical care.

This new study shows what researchers, advocates and the San Francisco public knew to be true: San Francisco’s PSLO has had a tremendous impact on workers’ lives with little to no impact on the city’s businesses. Two-thirds of the employers surveyed now support the PSLO. They overwhelmingly report that their profits haven’t declined as a result of the law and two-thirds report no difficulties with implementation.

The study results suggest that part of the reason the impact on business has been minimal is that workers only take sick days when they need them. Even though the law allows workers to take between five and nine paid sick days annually, San Francisco workers used a median of just three days per year to recover from an illness or care for a sick family member. And one-quarter of workers reported that they didn’t take a single sick day. Commonly used arguments about employee abuse, just like concerns about hindering businesses, simply aren’t reflected in the real-life data coming out of San Francisco. It’s no wonder that the Golden Gate Restaurant Association, one of the chief opponents of the law prior to its passage, now concedes that there has not been an adverse impact on business closures or employee misuse.

This new data proves that access to paid sick days really does make a difference for working families. More than half of the workers surveyed said they have benefitted from the law. And the law has given workers who need paid sick days the most—including parents and workers with chronic health conditions—the time they need to care for their health and the health of their children. Every day we hear the stories of parents who are forced to choose between their children’s health and the financial well-being of their family; lower-wage workers who have to put off visits to the doctor and sacrifice their health to avoid losing their jobs; and workers with conditions like asthma and diabetes that require ongoing care but who are forced to put their long-term health in danger because they have no sick time. This study shows the power of a simple common-sense policy in improving the lives of these workers and their families.

One sobering note from the study is that not all workers have been able to enjoy the PSLO’s protections. Between one-fifth and one-third of the city’s employers are not complying with the law, either by failing to provide time off or by asking for more documentation than the law requires. The survey results are a call for greater employer education, outreach, and enforcement to maximize compliance and workers’ access to the protections the law provides.

As a whole, this new report adds to the growing evidence that paid sick days policies benefit working families, employers and our communities. Currently, 40 percent of private-sector workers in the United States don’t have access to paid sick days. And millions more cannot use the time they have to care for a sick child or family member. Washington, DC, and Milwaukee, WI, have already followed San Francisco’s lead by passing paid sick days laws, and states like Connecticut are seriously considering legislation that would guarantee workers the right to earn paid sick days. There are no more excuses for lawmakers and employers not to do the right thing for working families. The scare tactics used by opponents have been shown to be baseless. It’s time for lawmakers to reject them and enact the common-sense policies that are proven to work for everyone.

Vicki Shabo is the Director of the Work and Family Programs with the National Partnership for Women and Families based in Washington, DC.

IWPR’s Top Five Findings of 2010

by Jennifer Clark

1.  The recent recession was not predominantly a “mancession.”

While men represented the majority of job losses during the recession, IWPR’s research shows that single mothers were almost twice as likely as married men to be unemployed.  Another IWPR briefing paper examines how the “Great Recession” was an equal opportunity disemployer, doubling nearly every demographic group’s unemployment rate. In many families, women increasingly became the primary breadwinner, but they still spent more time in unpaid household labor than men. This imbalance of effort at home persists whether men are employed or not.

2. Only 12 percent of single mothers in poverty receive cash assistance through the Temporary Assistance for Needy Families program.

In the briefing paper, “Women in Poverty During the Great Recession,” IWPR shows that the numbers of single mothers in poverty receiving TANF assistance varies in the states. In Louisiana, only four percent of single mothers in poverty have TANF assistance. While in Washington, DC, the jurisdiction where impoverished mothers have the highest enrollment, still only 40 percent of single mothers receive any cash assistance through TANF.

3. Community colleges would need to increase the supply of child care on campus at least 10-fold to meet the current needs of students.

More than one-quarter of the students at community colleges have children, yet the supply of child care on campus does not meet the current needs of students. For many student parents, community college is an avenue to better jobs that allow them to support their families. As part of IWPR’s current project on post-secondary education, IWPR released a fact sheet in June, which noted that the proportion of community colleges providing on-campus care for the children of students decreased between 2001 and 2008, despite the great need.

4.  Young women are now less likely to work in the same jobs as men.

Reversing the progress made by earlier cohorts of young women entering the labor market, younger women today are now less likely to work in traditionally male and integrated occupations, which tend to pay better than traditionally female occupations. When told that traditionally male occupations pay more, women receiving workforce training said they would choose the higher paying job. In addition, women earn less than men in all but four of 108 occupational categories including in occupations-such as nursing and teaching-where women represent the majority of workers.

5. The majority of all likely voters support paid sick days.

IWPR’s new study shows that, while 69 percent of likely voters-including majorities of Democrats, Republicans, and Independents-endorse laws to provide paid sick days, two-fifths of all private sector workers lack this benefit. IWPR’s research also shows preventing workplace contagion of communicable diseases-such as influenza or H1N1-by providing paid sick days will save employers and the US economy millions of dollars.

Jennifer Clark is the Development Coordinator with the Institute for Women’s Policy Research.

Healthy Families Act Hearing

HFA Hearing Photo
Dr. Jody Heymann, Heidi Hartmann, Dr. Rajiv Bhatia and Mr. G. Roger King (Photo by Michelle Schafer)

On Tuesday February 13th, experts and Senators alike braved the wintry District weather to attend a hearing on the Healthy Families Act. Senator Kennedy, Chairman of the Health, Education, Labor, and Pensions Committee sponsored a hearing to discuss the need for the Healthy Families Act. Dr. Heidi Hartmann, IWPR’s President, was among those invited to testify. One of her strongest arguments for paid sick days for families included a study done by IWPR that found employers would save an estimated 9 billion dollars in turnover costs. The logic behind this figure is that workers with paid sick days will be more likely to retain jobs therefore lowering the cost of rehiring for their positions by 43%. IWPR’s research provides the best reasoning for why the Healthy Families Act actually benefits businesses, an issue that Senators Enzi (WY), Isakson (GA), Allard (CO) seemed to be most concerned with.
Dr. Hartmann also reminded Senator Enzi and the committee that passing the Healthy Families Act would actually have a positive effect on wage inequity between men and women. Achieving pay equity has been a goal of Senator Enzi’s and of other committee members in other legislation, the Workforce Investment Act among others. Dr. Hartmann emphasized the importance of family leave for women who are often the primary care givers of children and the elderly. With seven paid sick and family care days to be provided by their employers, women would be more able to take a day to care for themselves or a family member without the fear of losing their jobs, a change that will help them retain their jobs and become eligible for seniority-based wage increases and promotions, thus leading to wage increases and contributing to narrowing the wage gap.
Dr. Jody Heymann argued for the Healthy Families Act through an analysis of international competitiveness. Her statistics showed interestingly enough that although the US is among the top 20 most competitive economies in the world, we are the only one without paid family leave. She said that 145 countries provide such leave and that 100 of them provide a month or more for employees. Senator Sanders (VT) seemed most impressed with the international comparison data, while Senator Brown (OH) asked about the data on cost savings.
The hearing was well attended by Acorn members and representatives of various women’s groups. All the Senators and witnesses spoke in favor of paid sick days (it’s hard to be against them), but one witness and several Senators expressed concern that it would cost too much and drive away business. The record was left open so that further questions could be addressed by the witnesses.
– Elisabeth Crum

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