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Thursday, October 24, 2013

Business Owners Divided Over Paid Sick Leave

(Svenstorm/Flickr)

(Svenstorm/Flickr)

Flu season is approaching, and the Center for Disease Control’s advice is simple: Stay home for at least 24 hours after your fever is gone, and while sick, limit contact with others as much as possible to keep from infecting them.

But what happens if staying home means you don’t get paid — or worse, you lose your job?

About 40 percent of American workers don’t have paid sick leave. The bulk of employees without sick leave work in the food service and child care industries.

But there is a growing trend of cities taking up legislation to require paid sick days. Jersey City, N.J., just passed a law requiring businesses with 10 or more employees to provide paid sick leave, and Newark will take up similar legislation next week.

Two business owners take different sides

Steve Yglesias, owner of Mompou Tapas Bar in Newark, is against the legislation, but only because it is too much of a financial burden at this time.

“We just went through seven years of a horrible economy, and on top of everything else … we had Sandy,” Yglesias told Here & Now‘s Robin Young. “From a compassionate level, as a small business owner, I think it is necessary to have paid sick leave for your employees. It’s a wonderful idea … I just think the timing is a little off.”

Justyna Stachowicz, owner of Art Kitchen in Newark, disagrees. She supports the legislation from a public health point of view.

“I think you’re saving money doing this, because what if the person comes, and makes other people sick?” Stachowicz said. “It’s just healthier for everyone to do something like this.”

Studies show costs and savings

Policy analyst and columnist Martha Burk, who has written about paid sick leave for Ms. magazine, agrees with Stachowicz’s assessment.

“I don’t think that we can get across the fiscal argument to people, but people do react to the health argument,” Burk said.

She cites a 2009 study by the CDC that found 7 million additional people contracted the flu from a co-worker who came to work while sick.

Another CDC study found that 12 percent of food service workers came to work even when they were sick with symptoms like diarrhea and vomiting.

Burk says about 40 percent of private sector workers — 40 million people — do not have paid sick leave.

A study by the Institute for Women’s Policy Research found that offering sick leave to food service workers would cost a business an addition 19 cents per hour.

Cities lead the charge

Burk notes an interesting trend in legislating paid sick leave: individual cities, such as San Francisco, Washington D.C., Seattle, Portland, Oregon and New York City, have taken up the charge.

A number of Republican-controlled state legislatures have preempted this trend, Burk says, barring individual cities from passing sick leave laws.

On the federal level, Burk calls Congress’s lack of action on paid sick leave “pathetic.”

“It’s been introduced in every Congress since 2005,” Burk said. “It’s never even gotten out of committee. It’s never even gotten to the floor for a debate.”

Guests

Transcript

ROBIN YOUNG, HOST:

Well, the insurance debate is highlighting the difference in coverage for U.S. workers. There's also a huge disparity when it comes to paid sick leave. About 40 percent of American workers do not have paid sick leave, and many of them are low-income, food service, child and elder-care workers. But in a growing trend, many cities are taking up legislation to require paid sick days.

Newark, New Jersey is next. Next week, legislation will be introduced by the city council. Advocates are elated, but opponents like the New Jersey Business and Industry Association say you can't write a one-size-fits-all policy on something like this and it will be a financial burden for small businesses.

Let's hear from two business owners. Steve Yglesias is owner of Mompou Tapas Bar in Newark, New Jersey. He does not pay for sick days off. He told us a couple days ago he was really against it, but Steve, we understand you got to read the proposed legislation last night. So what are you thinking?

STEVE YGLESIAS: Personally, from a compassionate level, as a small business owner, you know, I think it's necessary to have paid sick leave for your employees. It's actually a wonderful idea, and it should happen. I simply feel that right now we're starting to come out of the economy, it's very difficult to do business these days if you're in a small business. I just think that the timing is a little, is a little off.

YOUNG: So you feel like it's a financial burden you can't handle right now.

YGLESIAS: You know, at the moment, yes, I would have to say that.

YOUNG: It's interesting because, well, we're hearing from a lot of people, food and beverage associations in particular, who are against this for the very same reason. They feel that it's too much of a financial burden. I'm wondering, it sounds as if, having read the legislation, have you shifted your thinking just a little bit? Were you more against it before seeing how little it actually is? It's just a few days off.

YGLESIAS: Yeah, I mean that's true. I mean, after looking at the legislation here, if you have 10 or more employees, it's the equivalent of a 40-hour work week, you know, which is not huge. And when you're a small business owner, you don't have the ability to give people the type of benefits that larger corporations do. So, you know, you try to get creative. You know, and if someone needs a day off to take care of their kids, or they need a day off to do certain things, you tend to give them that.

YOUNG: But still, you've been thinking I can't afford paid sick leave, although it sounds as if the more you're thinking about it and researching it, you're more leaning towards it. But address that financial concern, because I'm betting that when you've got 10 people, and two are out with the flu, you're really strapped to cover those two people.

YGLESIAS: Well, that's true. But let's look at the other side of things. If you have 10 people, and, you know, obviously your staff wants to go on vacation like everyone else does, and they typically take two weeks a year, they spread them out. If you have someone who's out for two weeks, and this law comes into effect, then in essence, you know, you're having to pay for three weeks on 10 employees.

When you're a small business owner, it's substantial. It does - the cumulative effect is greater than it would seem.

YOUNG: But we're looking at some stats. For instance, here's one from the Institute for Women's Policy Research. They say it only costs 19 cents an hour more per worker to do paid sick leave.

YGLESIAS: Well, I'm sure that that 19 cents an hour is spread over the year that the worker works. You know, when you have someone who's out, you really feel the burden of that financial output in that week. It's not like you, you know, put it on the spreadsheet and say, OK, well, it's only going to cost me 19 cents a year.

Again, I would say that I think the legislation is probably - is necessary, you know, and I think it's good legislation. I just think that, you know, we just went through seven years of a horrible economy, and for those of us that are in New Jersey, on top of everything else we had Sandy. And you know, I would say that the only thing missing was locusts, but we also had that. So...

YOUNG: You had the cicadas.

YGLESIAS: Cicadas, that's right.

(LAUGHTER)

YOUNG: That's Steve Yglesias, owner of Mompou Tapas Bar in Newark, New Jersey. Steve, thanks so much for taking a break to talk to us.

YGLESIAS: Oh, thanks very much for your time, and thanks for having me on.

YOUNG: Well, now let's bring in Justyna Stachowicz. She's owner of the Art Kitchen in Newark, New Jersey. And Justyna, you are for paid sick leave. Why?

JUSTYNA STACHOWICZ: I don't think it's a good situation for, you know, like people who you work with, because you actually can give them your sickness too, also. Then you have more people, more sick people. I used to work for many companies, and some of them actually didn't pay my sick days, and I know how stressful it is. You have to pay your rent, and you have to skip one day of work, it's a lot of money. So...

YOUNG: Would you actually go to work sick?

STACHOWICZ: You know, I used to. I used to do it. And when you are sick, you are - you don't give your positive energy to people. You know, like nobody wants to go to a place where someone is sick and, you know, sneezing and, like, coughing on your food. So I just - first of all, I think it's very unprofessional, actually, to let someone work being sick.

You know, when you see that your boss cares about you and, you know, actually becomes like family with you because you see that, OK, like wow, he really cares that I'm sick and he's, you know, like he's going to still pay me for it. So, you know, you come back to work, and you feel, you know, like you are appreciated, and you work better for him.

YOUNG: So you're saying when you were a worker, and one boss did give you paid sick leave, it made you want to work harder for him, and it sounds like you're hoping your workers do the same thing. But won't this really cost you? Because if you have someone out on paid sick leave, you have to pay someone to take their place.

STACHOWICZ: It's not that you are losing money doing this. I think that you are actually maybe even saving money doing this, because what if the person comes and makes other people sick?

YOUNG: But another concern, are you worried that people will take advantage of it, that will people take it off even if they're not sick?

STACHOWICZ: Some people might do it. I'm hoping that they will not. But another thing, this - like I heard it's going to be only five sick days. So I don't think it's this many. You know, if it was two weeks, probably I would be like I'm not sure if I want to do it because two weeks, it's a lot, but five days, it's not so many days.

And I think most of the people will not even use those five days, at least like I don't get sick like five times a year.

YOUNG: Well, one last question: Why legislate it? An employer like yourself, who wants to do it, you can do it. Why legislate it in Newark so that other people have to do it if they don't want to?

STACHOWICZ: What if I go to another place, and I have another, I don't know, like sick person serving me food. So it's not only about, like, my place, it's about my health too. And the same, like in the future I will not be the owner of the place, and I'm going to be working for someone, and I'm sick, and I'm going to be scared again to stay at home. It's just healthier for everyone to do something like this.

YOUNG: That's Justyna Stachowicz, owner of the Art Kitchen in Newark, New Jersey. She's for the bill being considered by the city to enforce paid sick leave. Justyna, thanks so much.

STACHOWICZ: Thank you so much.

JEREMY HOBSON, HOST:

And let us know your thoughts on paid sick leave. You can go to hereandnow.org or Facebook.com/hereandnowradio.

(SOUNDBITE OF MUSIC)

YOUNG: It's HERE AND NOW, and we're continuing our look at paid sick leave. Out of 20 top economic countries, the U.S. is the only not to mandate paid sick leave, although most workers in high-salary jobs demand it, and city councils are considering it. Next week, Newark, New Jersey, will consider legislation that will require paid sick leave for businesses with more than 10 employees.

We just heard from two restaurant owners. One said he can't afford it. Another said she felt it prevented illness. Martha Burk is money editor for Ms. magazine. She's in the studios of KANW in Albuquerque, New Mexico. And Martha, after your research, you became an advocate. We want to give a warning to listeners, it's a little gross, but what convinced you - what are the stats on how often low-wage workers work sick?

MARTHA BURK: That's right. The Centers for Disease Control found a year or so back that 12 percent, which is a pretty darn high percentage, of food service networks had either thrown up or had diarrhea on two or more shifts in the last year. That is scary.

YOUNG: Well, but we're reading in other reporting in the Washington Post that restaurant owners are saying they're being forced to adjust to provisions of the Affordable Care Act. The president and chief executive of the Restaurant Association of Metropolitan Washington, D.C., said we have too many burdens being placed upon us, including health care coverage. If you add paid sick days, we wouldn't be able to create jobs.

BURK: Well, the Institute for Women's Policy Research in Washington has actually figured out what this is going to cost to offer sick leave to food service workers, and it's 19 cents an hour. Now that's not nothing, but when you balance it against the national health care costs, when somebody's sick they don't go to the doctor because they can't get off work, they get sicker, they end up maybe going to the emergency room, health care costs go up across the board.

So you can't really say, well, it's just going to cost a lot of money, so we can't do it. You know, taking that to the logical conclusion, it costs a lot of money to pay people at all. Why don't we just go back to slavery?

(LAUGHTER)

YOUNG: Well, who does get sick leave?

BURK: Mostly workers in the public sector get sick leave. Eighty percent of state and local government employees and basically all federal workers do have some paid sick leave.

YOUNG: Is that because they have union representation in many cases?

BURK: It's partly because of union representation, but it's also because government workers traditionally have better benefits across the board than private-sector workers. And when you look at private-sector workers, about 40 percent have zero, not even one paid sick day a year, and that translates to 40 million people in the United States, supposedly one of the most progressive countries in the world.

YOUNG: And as we look at it, it seems as if the people who don't have the sick leave might be the people who need it the most: low-wage workers on the bottom of the income ladder who can't afford child care. So it's not just that they are getting sick, but if their children get sick, they can't stay home with them.

BURK: They not only can't stay home with them, they don't have someone else to stay home with them. So what do they have to do? They send the kid to school sick. And we have a lot of documentation of that. One story that I read in researching the Ms. article is a little girl that was very, very sick at school. They sent her to the nurse. She began to cry and say no, don't call my mother. If my mother has to come get me, she'll lose her job.

YOUNG: Well, some states have decided that they are going to institute sick leave. Where do we stand on movement across the country to get paid sick leave?

BURK: That's a very good question because there are two sides to the coin. There Connecticut has paid sick leave; the city of San Francisco; Portland, Oregon; Washington, D.C.; and Seattle; all of those and most recently New York City have passed it at the city level.

What's interesting on the other side of it is that state legislatures are trying to preempt cities, and states are passing laws that say no city in this state can grant sick leave on their own, and that's happened in Kansas, in Tennessee, Mississippi, Louisiana, Arizona and most recently Florida. So - and even in Michigan where no city is even trying to get sick leave, they've passed it preemptively.

In other words the state is saying no, we as a state are telling you as a city you cannot grant sick leave. So that is a big backlash. It's mostly Republican legislatures, I'll have to say.

YOUNG: Well, but what about on a federal level?

BURK: Federal level is pathetic. It's been introduced in every Congress since 2005. It's never even gotten out of committee. It's never gotten to the floor for a debate yet.

YOUNG: Well, how do people feel about it? What do polls show?

BURK: Oh, polls are very interesting. Depending on which poll you read, somewhere between around 70 to 85, 86 percent of the people endorse paid sick leave.

YOUNG: Well, when you look at some of the proposals, they don't seem exorbitant. Jersey City passed an ordinance at the end of September requiring paid sick leave. Here's how it's outlined: Employees will earn one hour of paid sick time for every 30 hours worked with a cap at 40 hours per year.

BURK: Five days.

YOUNG: Five days. They have to work for 90 days before they can use it. So that's five days a year.

BURK: It's five days a year, which you'd have to use very judiciously. People are not going to call in casually, especially when they don't know if they're really going to become ill later. Another thing about it is that it has to be earned, as you pointed out. It doesn't start from day one. You don't get the job and then take off the next week and say you're sick. You have to earn it. You have to use it judiciously, and it's really good for the company.

One study showed that even for low-wage workers, it cost several thousand dollars to replace a worker that quits or gets fired for whatever reason because they have to advertise, they have to interview, they have to screen, sometimes do background checks. All that costs money. And it seems like to me the 19 cents an hour it would cost to provide this benefit would be cheaper than replacing an employee when you fire them.

YOUNG: But as we said, when Jersey City passed its ordinance, the Business and Industry Association wrote we understand the desire to help workers, but we feel it'll have a negative impact on both large and small employees. Martha, you say research shows that it doesn't. How does that get across to people?

BURK: Well, I don't know that we can get across the fiscal argument to people, but people do react to the health argument. In 2009, the Centers for Disease Control and Prevention did a study about how many people were infected with the flu from workers who came to work with the flu. That was the year of the big flu epidemic. And that was seven million additional workers that got the flu because their co-worker came to work sick.

And we don't even know how many people that affected of food service workers that were serving food while sick. So that argument I think resonates with people much more than the fiscal argument. And when you do talk about money, let's take McDonald's for example. They made a profit of $5.5 billion last year. So it does make you wonder could they pay 19 cents more an hour to keep people healthy and not passing along infection through food service and food handling. I think they probably could.

YOUNG: That's Martha Burk, money editor for Ms. magazine. Her article in the magazine is "The Wisdom of Paid Sick Leave." Thanks so much.

BURK: It's been my pleasure, thank you.

YOUNG: Again, we'd love your thoughts. Go to hereandnow.org to let us know if you have paid sick leave. Do you use it? Are you a small business owner trying to decide whether or not to have it? Let us know, hereandnow.org, where Nicolas(ph) has already weighed in, HERE AND NOW. Transcript provided by NPR, Copyright NPR.


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Robin and Jeremy

Robin Young and Jeremy Hobson host Here & Now, a live two-hour production of NPR and WBUR Boston.

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