National Paid Sick Leave for Equitable Public Health

Jeffrey Qi

Introduction

The COVID-19 pandemic exposed a glaring need long present in the United States: the need for national paid sick leave. According to the Bureau of Labor Statistics, 22% of workers in private industry lack access to paid sick leave.¹ However, this lack of access to paid sick leave is distributed unevenly across income levels and by work status, with roughly 96% of the highest-paid workers (top decile of income) having access to paid sick leave, while only 39% of the lowest-paid workers (bottom decile of income) have access.² Furthermore, only 51% of part-time workers have access to paid sick leave, compared to 87% of full-time workers.³ Moreover, these low-income workers are more likely to be economically insecure and struggle to pay their bills, with many holding service-sector jobs in industries such as retail and food service that involve significant person-to-person interaction.⁴ This interaction substantially increases the risk of disease transmission between workers and patrons in service industries. Due to inequities in access to paid sick leave, presenteeism, the phenomenon where workers show up to work while sick and not fully functioning, has led to significant costs to businesses, workers, and public health. While some businesses, municipalities, and states have implemented paid sick leave, many of the most vulnerable workers have been left behind. Therefore, the United States should adopt a national paid sick leave policy because it would promote economic and health equity while mitigating the costs of presenteeism, thereby benefiting employees, businesses, and the broader community.

Presenteeism: Working While Sick

Workers who lack paid sick leave face a serious dilemma when they or a family member fall ill. Working while sick diminishes the quality and quantity of one’s work and often makes recovery from an illness take longer. Working through sickness and fatigue or while a family member is ill is a highly uncomfortable experience, which may result in alienation from work, lower job satisfaction, and lower employee retention. Moreover, it also may result in a workplace epidemic that puts other workers and patrons at risk, potentially reducing the business’s overall productivity. However, if workers choose not to show up to work, they will at best lose a portion of their wages – straining workers’ budgets, especially for low-income workers – or they may even lose their jobs. As a result, many workers show up to work while sick. Studies estimate the costs of presenteeism to be roughly $150 billion per year, and others find that presenteeism tends to be much more costly than illness-related absenteeism.^5,6 In other words, businesses and communities suffer far more in terms of both economics and public health when workers come to work sick than when they stay home and recover.

State-Level Paid Sick Leave Interventions

The United States is the only developed nation lacking a national paid sick leave mandate, leading states and municipalities to take matters into their own hands. By 2024, fifteen states, Washington D.C., and many cities (including New York City, San Francisco, and Chicago) have enacted paid sick leave policies.⁷ Most state-level paid sick leave laws allow workers to accrue an hour of sick leave for roughly every 30 to 40 hours worked, while preventing firms from retaliating against workers who use their sick leave.⁸ The amount of paid sick leave that can be accrued per year is capped at roughly 40 hours (although this amount varies by state), and the cap can be set higher at the employer’s discretion.⁸ Furthermore, some laws have built-in exceptions for small businesses that cannot afford to implement paid sick leave.⁷

States’ experiences with paid sick leave demonstrate that mandatory paid sick leave policies are an effective way to mitigate presenteeism in the workplace. Theoretically, decreasing the relative cost of not going to work while sick – by providing paid sick leave – should disincentivize presenteeism. Multiple studies verify this: paid sick leave has been associated with reductions in contagion spread and presenteeism, higher employee retention, and higher job satisfaction.⁹ Furthermore, natural experiments evaluating the effect of paid sick leave laws by state found that these laws reduce transmission of influenza-like illnesses and decrease aggregate leave-taking.^10,11 While paid sick leave may lead to increased absences from work, these absences prevent workplace contagion spread and help workers recover from their illness, allowing them to return to full productivity more quickly. Therefore, the gains from mitigating presenteeism likely more than make up for increased absenteeism.

Continued Opposition and Potential Solutions

Some firms, including Costco and The Home Depot, have recognized the benefits of paid sick leave on productivity and offer it to their employees. However, employees at many large firms like Walmart and McDonald’s continue to report that they lack access to paid sick leave even though increasing access would likely lead to significant productivity and public health benefits.¹² Many workers at these firms are low-income, part-time, service-sector workers who would thus benefit the most from paid sick leave. In addition to firms refusing to offer paid sick leave, several states have passed preemption laws that prevent cities and counties within the state from implementing local paid sick leave policies.¹³ Therefore, addressing disparities in access to paid sick leave for all necessitates action on the federal level.

Some opponents of this paid sick leave at the national level argue that it may impose heavy burdens on businesses and lower employment and wages, but evidence supporting this is lacking. For example, data from the Center for Economic and Policy Research show that after Connecticut implemented an earned paid sick leave policy in 2012, businesses found that the policy had little effect on their costs, and abuse of the law by workers was minimal.¹⁴ It did, however, expand access to paid sick leave for part-time workers, benefiting them disproportionately.¹⁴ Other studies demonstrate that paid sick leave has minimal effects on employment rates and wage growth and that it leads to higher profitability and productivity.^15,16,17 These results suggest that paid sick leave benefits businesses by addressing the negative externality of presenteeism. Others argue that rather than being mandatory, paid sick leave should be left as a benefit that businesses can offer employees as an incentive. However, this inequitable arrangement ultimately leaves behind those workers who are the most vulnerable and least able to negotiate paid sick leave in their employment contracts. It also allows presenteeism, a significant negative externality, to persist, harming both workers and businesses.

In addition, some firms may feel uncomfortable instituting paid sick leave policies for their workers out of concern that these policies may attract workers with costly medical issues who will use up all of their paid sick leave time. If this scenario did occur, it would cause disproportionate financial distress to the firm with the paid sick leave policy, while leaving its competitors without the policy at an advantage.¹⁷ This hypothesized result disincentivizes firms from instituting paid sick leave policies at the individual level, preventing them and workers from enjoying the potential benefits of such a policy. Mandating paid sick leave would address the adverse selection issue, as no firm would disproportionately attract workers with health issues or experience disproportionately high costs relative to competitors.¹⁷ Therefore, mandating paid sick leave would reduce presenteeism and improve profitability and productivity without creating disproportionate costs for individual firms.

Conclusion

The current state of paid sick leave in the United States is inequitably distributed across income levels and industries, and results in significant economic and public health burdens. Implementing paid sick leave at the federal level is essential to address this inequality and support public health. This progressive policy not only provides economic security for workers who fall ill but also benefits businesses and protects the community, promoting economic growth and public health.

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