The Benefits of Paid Sick Days: What’s Good for Workers is Good for Businesses

02 Jul 2014 |
The Benefits of Paid Sick Days: What’s Good for Workers is Good for Businesses
Above: Makini Howell, Owner of Plum Street Bistro

In 2011, Connecticut became the first state to require workers to be able to earn paid sick leave. For many part-time workers, especially in industries like retail and hospitality, it was their first opportunity ever to earn paid sick leave. Though opponents to the law claimed that it would negatively impact business in the state, an evaluation of the law to date by the Center for Economic and Policy Research, however, found the opposite to be true. Not only was the impact on business minimal, employment actually rose in several sectors, including hospitality and health services, again proving that what is good for workers is good for businesses.

The need for basic work supports, like paid sick leave, was a cornerstone of the White House Summit on Working Families last week. The Summit brought together advocates, business leaders, elected officials and workers to focus on ways to help support working families. As part of the Summit, several business leaders testified to how providing work supports not only helped increase productivity and returns, their businesses also thrived and expanded. Ranging from large, multi-national corporations to small, local restaurants, providing paid time off and flexible work schedules improved staff morale and productivity and also helped business growth.

Moreover, these basic work supports are being offered by small businesses and industries that are in highly-competitive and predominantly low-wage industries. In Seattle, Plum Bistro Restaurant led the successful effort to increase the city’s minimum wage to $15 an hour. A member of the Main Street Alliance, a network of small business owners, Plum Bistro’s owner stated that while offering paid sick days costs only pennies per plate, the costs are more than made up for by improved retention, higher employee morale and increase customer satisfaction.  Costco uses a model counter to most retailers and pays living wages and provides paid benefits to all its employees. Not only do its profits steadily grow, Costco has a remarkably low turnover employee turnover rate--only 5 percent for employees who have been there over a year leave.

Currently, 41 million people do not have access to paid sick leave. Women and people of color are overrepresented in industries that do not offer paid sick leave. African American and Latino workers, in general, are far more likely to not have access to paid sick days than white workers. While businesses would see little to no impact on their bottom line, offering paid sick leave is the number one policy women living in poverty or right on the edge say would give them a leg up, even more than a wage increase or other benefits.

Giving workers the ability to earn paid sick leave is more than the right thing to do, it’s a smart business move that underscores how what’s good for workers is good for the economy.