Response to Critique

Employers will likely reduce pay or other benefits – James Sherk has argued that in order to cover the cost of paid sick days companies would respond by reducing cash wages.  He says that mandatory sick leave requires workers to take less of their compensation as cash wages and more as time off, whether they want to or not.[1]  Reduction of wages is one way to respond to increased absenteeism due to availability of paid leave.  Overall however, employers are expected to experience greater savings (from increased productivity, reduction in turnover, and health insurance savings) than they are to endure costs and these savings could be passed on to the employer in the form of a more generous benefits package (i.e. paid leave). 

Action will Increase Unemployment – Sherk has argued that Congress should not take action during a steep economic downturn because mandated benefits have many of the same labour market effects as raising taxes on workers and therefore jobs would be lost.[2]  However, the data does not support the concern that good working conditions lead to job loss; in fact, improvements in working conditions are “associated with higher unemployment rates on a national level.  Globally, the most economically competitive countries provide, on average, longer parental leave, as well as more leave to care for children.”[3]  Furthermore, “[s]tudies of San Francisco after several years of mandated paid sick days showed that six out of seven employers reported no problems and job growth was faster than in five surrounding counties.”[4]  Research has shown that paid sick days lead to job retention and stability, particularly important in an economic recovery.[5]