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In Final Push For A Law, Paid-Sick-Time Backers Change Bill To Apply To Service Workers Only

Dan Haar

May 18, 2011

As a crucial vote on paid sick time approaches in the state Senate, supporters have watered down the bill to cover service workers only.

The measure, a familiar, annual controversy in the state Capitol, would allow workers to earn up to 40 hours a year of paid time off for sick leave, or to care for a sick child, at companies with at least 50 employees in Connecticut.

It's a close vote every year, and this year is no exception. But with the Senate ready to take it up as soon as this week, the stakes are higher in 2011 because Gov. Dannel P. Malloy says he supports the idea. Connecticut is likely to become the first state in the nation to force restaurant chains, home health care agencies, school bus companies and other employers of low-paid service workers to give paid time off for illness.

That distinction is a dangerous place for Connecticut to be at a time when states compete for jobs, and it – along with the amazing skill of Kia Murrell, the main lobbyist opposing the bill -- has gone a long way toward preventing the bill from passing into law.

The bill comes with a risk of negative unintended consequences. But for several reasons, the time has come for Connecticut to lead the way on paid sick time for the people who prepare our food, take care of our elderly parents and drive our kids to school.

Leaving out all but a detailed list of service workers means the types of companies that pay low wages and flee high costs — non-high-tech factories and distribution plants, typically — will not be deeply affected. And restaurants and bus companies don't move out of state.

Cutting out manufacturers, tech firms and other non-service workers may not be a big change anyway, since it was hard to find a manufacturer that would have been hurt badly by state-mandated paid sick time. Under the bill, any company that offers paid vacation time could use that time toward paid sick leave, although it must offer the same flexibility in the vacation time, and that's a burden for some.

Jon Green, executive director of Connecticut Working Families, the leading group behind the bill, tells a story about a meeting with an executive at a well widely known, French-owned manufacturer of consumer goods in Connecticut. This is a company we'd hate to see leave, and it could pull out if we're not careful.

The executive thought paid sick time would hurt his company. He had heard industry groups decry it as if it were a tax on meetings, heaven forbid. Turns out, his company offers two weeks of vacation, five sick days and three personal days — easily leaving it untouched by the bill even before this week's amendment.

It's obvious that we don't want certain people working when they're sick. That's not up for debate, but Murrell, of the Connecticut Business and Industry Association, argues that it's not about public health because restaurant workers, for example, typically switch shifts, and anyway, she says, we don't have a health crisis.

Public health aside, paid sick leave could improve employee morale and output, just as it could hurt marginal businesses and, perhaps, raise prices slightly. But at its worst it's not as bad as opponents fear, nor is it a particularly big step forward for Connecticut's low-wage workers, who have fallen behind even as their employers have regained healthy profits.

We wouldn't be having this debate in the first place if these companies paid a sustainable, living wage. And if they do, paid time off is part of the picture.

Green presents data from the labor-backed Economic Policy Institute showing that in retail trade, the bill would add just one-tenth of 1 percent to overall costs, and in health care it would add four-tenths of 1 percent. The reason is that labor costs are only a part of overall costs, and 40 hours a year is only a small percentage of a worker's total, and workers will not use all of their available time off for sick pay.

The bill specifically gives companies the power to discipline workers who abuse sick leave.

Nonsense, Murrell says. They are likely to use all of their time, and even if they don't, companies must account for it under standard financial rules, if the days carry over. Worse, the mandate takes away a company's flexibility — which costs money and spells big headaches.

"We completely disregard the proponents' fuzzy math," Murrell said. "You're talking about jeopardizing work and economic development."

She's right that many people whose only time off is paid sick time would use use the benefit as personal time, and she's right that the bill could quell job growth, though probably only barely if at all.

But here's the flaw: Murrell, citing a study in New York, says the bill will cost the economy many millions of dollars. That's not exactly true, as a group of 16 Connecticut economists pointed out in an open letter to legislators this week. It will cost the companies, and it probably will cost consumers, but it will benefit workers. And they, too, are part of the economy.

This could turn out like the old debate about banning smoking in bars and restaurants. Opponents said it would shutter a vast swath of the industry, as smokers – at the time a big percentage of customers – stayed away. Looking back, we now know the ban did cause some pain, but overall it led to an unimagined boom in restaurants.

Let's hope that scenario repeats itself, and Murrell and the mostly Republican opponents of paid sick leave are wrong, because the service-worker-only amendment makes it likely to become law.