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Paid Sick Leave: Good for Business, Study Finds
  • Posted February 27, 2023

Paid Sick Leave: Good for Business, Study Finds

The United States is one of the few developed nations without federal paid sick leave protection, owing at least in part to concerns about potential harms to business, according to a new study.

Yet, researchers studying the issue found that access to paid sick leave could have benefits for businesses.

Among them: fewer occupational injuries, less spread of contagious disease, fewer employee deaths and fewer people going to work despite being ill.

Paid sick leave was also linked to positive business conditions, including employee morale and job satisfaction, improved retention, higher profitability and performance as well as favorable labor market conditions, the study found.

"Findings from our study certainly inform voluntary adoption of paid sick leave policies by businesses as well as future legislation,"co-author LeaAnne DeRigne said in a news release from Florida Atlantic University. She is a professor of social work.

For the study, researchers at FAU and Cleveland State University reviewed 22 years of research examining the relationship between paid sick leave and short-term and long-term U.S. business outcomes.

They considered business size, industry and whether or not paid sick leave was required by law.

The researchers reviewed the relationship between paid sick leave and job satisfaction, morale, job commitment, turnover, retention, employee health and safety, occupational injury, absences, labor market effects, profitability, productivity and performance.

"Considering the weight that has been given over time to the potential harm of paid sick leave to business, we were surprised to find so little evidence to support this concern,"said lead author Candice Vander Weerdt, a lecturer in the College of Business at Cleveland State. "Aside from small increases in worker absence, what we found was actually the opposite, a trove of evidence suggesting paid sick leave is linked with favorable business outcomes."

Most of the research showed a small but significant increase in worker absences associated with paid sick leave, along with a decrease in going to work while sick, the study found.

"Our study is particularly timely given the health concerns, mass resignations and labor shortages observed during the COVID-19 pandemic, which have compromised access to healthy, reliable, and enduring human resources,"said co-author Patricia Stoddard-Dare, a professor of social work at Cleveland State.

The U.S. did offer temporary paid sick leave to some employees in the early part of the COVID-19 pandemic, from March through December 2020.

In recent years, 14 states have enacted paid sick leave mandates, while 18 states have passed legislation prohibiting paid sick leave laws.

It's been estimated that going to work sick costs U.S. companies billions of dollars each year in lost productivity.

"Coming to work sick, injured or ill can diminish productivity and performance and may lead to the spread of illness to other employees,"DeRigne said. "In any given week, about 2% of workers attend work while sick, particularly women, low wage workers, and those ages 25 to 34."

The authors noted vigorous legislative debate both for and against paid sick leave in years past.

They said the costs associated with increased absences as a result of paid sick leaves may be largely offset by improved job satisfaction and retention, better employee health and safety, and improved labor market performance.

Vander Weerdt noted that laws have greatly increased access to paid sick leave. However, access is not always equal across jobs.

"While paid sick leave is accessible to 92% of Americans earning in the top quartile, only 51% of those earning in the lowest quartile have access,"she said. "These workers are often engaged in food service, hospitality or retail work, meaning they are often on the front lines of our community."

Researchers found evidence that suggested spread of disease was lower not only for the workers with paid leave but for the entire region where paid sick leave mandates were passed.

Study findings were published Feb. 23 in the American Journal of Industrial Medicine.

More information

The Center for American Progress has more on U.S. paid sick leave laws.

SOURCE: Florida Atlantic University, news release, Feb. 23, 2023

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