CEPR

September 6, 2016

For Immediate Release: September 6, 2016
Contact: Tillie McInnis, 202-293-5380 x117

Washington D.C. — Back to school doesn’t just mean snack packs, new pencils, and notebooks – for many parents, it means forfeiting income when their child will, most likely, get sick at some point during the school year. But a recent report from The Center for Economic and Policy Research (CEPR) and the Murphy Institute at the City University of New York (CUNY), finds that there is little reason paid sick days should not be provided to workers.

The report, “No Big Deal: The Impact of New York City’s Paid Sick Days Law on Employers”, shows that the standard arguments against the paid sick days law were unfounded. Specifically, critics feared that it would lead to a loss of jobs in the City and impose a major cost burden on employers, and that the law would invite widespread abuse by workers.

CEPR’s Eileen Appelbaum, and CUNY’s Ruth Milkman, surveyed 352 employers with five or more employees in New York City, all of whom are covered by the City’s new paid sick days law. Along with a telephone survey using a random sample of employers, the researchers conducted in-depth on site interviews at 30 establishments. They found that employees do not treat paid sick days as an entitlement, but as insurance, for use when illness strikes the worker or a family member.

Employers reported virtually no abuse of the paid sick days law – 98 percent of respondents reported no abuse. Smaller employers (less than 50 employees) reported no abuse or a negligible amount. Even among larger employers, most — 95 percent of those with 50 to 99 employees, 90 percent of those with 100 to 249 employees, and 93 percent of those with more than 250 employees — reported no abuse.

The vast majority of employers (just under 85 percent) reported that the new law had no effect on their overall business costs, and a few (a little less than two percent) reported a decline in overall costs. Among those who did report an increase in costs (14 percent of all respondents), nine percent reported an increase of less than three percent in their overall costs; another three percent of respondents reported an increase of three percent or more, and two percent reported increased costs but were unsure of the exact percentage.

Professor Ruth Milkman, co-author of the report noted that “91 percent of businesses reported no reduction in hiring as a result of the new law, 97 percent did not reduce hours, and 94 percent did not raise prices. There do not seem to be significant costs to employers, and more cities and states should consider passing similar laws."

“New York City provides strong evidence that implementing paid sick days has virtually no negative impact on employers. Paid sick days do, however, have a huge positive impact for workers. These findings show that there are sound reasons for cities and states to reevaluate their paid sick days laws,” Eileen Appelbaum added.

You can find the full report here.

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