About the Brief

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Analyses show that providing paid sick days under any alternative model policy increases the amount of paid time workers are able to take for medical and family needs, as intended, at reasonable costs to employers, ranging from 0.10 percent to 0.29 percent of payroll according to the generosity of the model. Employers of different sizes and in different industries would experience a range of costs under each model. Employers with establishments of 500 or more workers would experience the largest new costs as a share of payroll (from 0.15 percent to 0.43 percent according to the model’s generosity), as would employers in education and health services (from 0.18 percent to 0.51 percent depending on the choice of model policy).

The brief analyzes two models taken from actual paid sick days policies in states and a federal proposal selected to provide variations in generosity. These models are applied to national workforce data to simulate national costs and benefits and represent a range of policy designs and benefit provisions. The San Francisco model, dating from 2006, has the most generous coverage, eligibility, and benefits. Vermont’s Act, passed in March 2016, provides fewer sick days and has more restrictive eligibility standards. The federal model provides paid sick days only for those workers in businesses with 15 or more employees, but eligibility is liberal, similar to the San Francisco ordinance. All three models include all government workers and require that the employer pay eligible employees for time taken off for covered reasons.

Key Takeaways

• Under three national paid sick days policies, paid and unpaid leaves taken increase from 9 to 13 percent.
• The cost of new paid sick days taken ranges from 0.10 to 0.29 percent of payroll for employers across the three different models.
• Under all policies, workers take fewer than the maximum amount of paid sick days available.
• New costs for employers would vary from 0.01 percent of payroll for the armed forces to 0.51 percent of payroll for educational and health services, depending on the model policy.

Citation

IMPAQ International. (2017). Estimating Usage and Costs of Alternative Policies to Provide Paid Sick Days in the United States Issue Brief—Worker Leave Analysis and Simulation Series. Chief Evaluation Office, U.S. Department of Labor.

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The Department of Labor’s (DOL) Chief Evaluation Office (CEO) sponsors independent evaluations and research, primarily conducted by external, third-party contractors in accordance with the Department of Labor Evaluation Policy and CEO’s research development process.