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Sick Economics

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Second only to their salary, all employees love and depend on their fringe benefits.

Fringe benefits can take the form of paid time-off for breaks, vacations, jury duty, personal reasons, maternity leave, or illness. They can be in the form of discounted or fully paid insurance for health, life, or disability. Participation in a pension or retirement program is a valuable benefit, especially when one’s employer does most of the contributing. Depending on the employer, fringe benefits can also include stock options, company child-care, a severance package, uniforms, meals, a company car, and employee discounts. Even taking unpaid time-off is a fringe benefit if one can return to work at will with no loss of seniority.

With the exception of the Family and Medical Leave Act of 1993, which requires large employers to provide unpaid, job-protected leave for employees to take care of a new child or sick family member, the federal government does not concern itself with employee fringe benefits.

According to the U.S. Department of Labor’s “Handy Reference Guide to the Fair Labor Standards Act” (FLSA),

While the FLSA does set basic minimum wage and overtime pay standards and regulates the employment of minors, there are a number of employment practices which the FLSA does not regulate.For example, the FLSA does not require:

  1. vacation, holiday, severance, or sick pay;
  2. meal or rest periods, holidays off, or vacations;
  3. premium pay for weekend or holiday work;
  4. pay raises or fringe benefits; or
  5. a discharge notice, reason for discharge, or immediate payment of final wages to terminated employees.

Then it says about the practices the FLSA doesn’t require, “The above matters are for agreement between the employer and the employees or their authorized representatives.”

Such is not the case, however, when it comes to state and local governments.

In my county in Florida, Orange County, there is circulating a petition to place on the November ballot an Earned Sick Time ordinance titled “A Proposal to Guarantee Earned Sick Time for Employees of Businesses in Orange County.” The ballot summary reads,

Shall Orange County adopt an ordinance providing that employees of businesses in Orange County earn up to 56 hours of sick time each year unless the business provides more — with pay required only in businesses with 15 or more employees as defined — to seek medical care, recover from illness/injury, care for a family member as defined, or use when necessary during a public health emergency, with such ordinance enforceable in court?

The sponsor of this initiative petition is Citizens for a Greater Orange County, a coalition of progressive groups that is paying three shifts of workers to gather signatures by canvassing neighborhoods with lists of registered voters, by standing in front of shopping centers and bus stops, and by visiting community events and churches.

The petition drive, which was begun in May, needs 43,605 signatures from registered voters — the total of 7 percent of the registered voters in each of the county’s six districts. Although county code gives petition drives a 180-day deadline, time is already running out for the Earned Sick Time petition.

Once the supervisor of elections verifies and reports to the Orange County Board of Commissioners that the requisite number of names has been submitted, the Board must then give notice and hold, within 30 days, a public hearing on the petition and vote on it. If it doesn’t pass, a referendum would be held at the next election, which would be the upcoming election in November. The problem is that the ballots for the November election must be sent to the printer this month. No citizen initiative has ever made it on the ballot in Orange County.

Groups making up the coalition in support of the petition include Organize Now, Mi Familia Vota, Equality Florida, the NAACP, and the Federation of Congregations United to Serve. Liberal activists are hoping a sick-pay initiative on the November ballot will bring swing voters to the polls to vote for Democrats.

Opposed to the petition are the Florida Restaurant and Lodging Association, the Florida Retail Federation, the Employment Policies Institute, and the Central Florida Partnership.

Also opposing the measure is Orange County’s Republican mayor,

Teresa Jacobs, who termed the sick-leave measure “well-intentioned” but “shortsighted,” and said it would have “unintended negative consequences” at a time when the economy is still in tough shape. “I am a strong believer in a free market and businesses being able” to make this kind of decision, Jacobs said.

A coalition of Orange County business groups including the Greater Orlando Chamber of Commerce, the Central Florida Hotel and Lodging Association, and the Home Builders Association of Metro Orlando recently filed a lawsuit challenging a sick-time ballot initiative and asking the Orange Circuit Court for an injunction to stop it, contending that the ballot language is misleading.

Under the proposed sick-time ordinance, all businesses with 15 or more employees “shall provide for accrual of a minimum of one hour of paid sick time for every 37 hours worked by an employee,” but not “more than 56 hours of paid sick time in a calendar year.” The accrual of sick-time begins “at the commencement of employment.” Employees “shall be entitled to use accrued paid sick time beginning on the 90th calendar day following commencement of their employment.” Unused sick-time will carry over to the following year, but no more than 56 hours can be taken in a year. Employees who separate from their employer but are rehired within six months are entitled to “previously accrued paid sick time that had not been used.” Covered employees include full-time, part-time, and temporary workers. Family members who can be cared for include domestic partners, grandparents and grandchildren, and “a designating person or support person as defined in Orange County Code.”

Such an ordinance is said to be needed because

  • many workers in the county will need limited time off from work each year to take care of the health needs of themselves or their families;
  • when workers lack paid sick time, they risk losing income and jeopardizing their jobs, contributing to their financial insecurity;
  • providing workers time off to attend to their own and their family’s health care will have a positive effect on the public health of the county; and
  • providing sick time is good for businesses, resulting in reduced worker turnover and reducing the competitive disadvantage that many employers face when they choose to provide sick time to their workers.

When reading the fine print that makes up the petition’s 14 sections, it is clear that the proposed ordinance could function merely as a mandate for a seven-day vacation for workers in Orange County, courtesy of their employers.

That is because it is only “for sick time of more than 3 consecutive days” that “an employee may be required to provide reasonable documentation that the sick time has been used” for a covered purpose. Employers may not require that documentation signed by a health-care professional “explain the nature of the illness,” and “disclosure of details of an employee’s or an employee’s family member’s medical condition shall not be required as a condition of providing sick time.” Moreover, “All persons are prohibited from retaliating or threatening retaliation against employees who request or use sick time.” And “each employee has the right to bring a civil action if sick time as required by this Chapter is denied or the employee is retaliated against for requesting or taking sick time.”

And even though the paid sick-leave part of the proposed ordinance doesn’t apply to businesses with fewer than 15 employees, workers in businesses not entitled to paid sick-time are allowed to take, without threat of “retaliatory personnel action,” up to 56 hours a year of sick-time without compensation. In other words, seven days off whenever they want them. And an agreement by a worker to waive his right to paid sick-leave “is void as against public policy.”

It is not just paying the sick-leave that will cost employers if this ordinance is adopted. In section 7, “Records,” it states that “employers shall maintain records documenting hours worked by employees and sick time taken by employees and shall retain such records for a period of five years.”

But Orange County, Florida, is not alone. According to the National Partnership for Women & Families, a “nonprofit, nonpartisan advocacy group dedicated to promoting fairness in the workplace, access to quality health care and policies that help women and men meet the dual demands of work and family,” paid-sick-day campaigns or legislation also exists in Arizona, California, Colorado, Hawaii, Illinois, Iowa, Maine, Massachusetts, Michigan, Minnesota, New Jersey, New York, North Carolina, Pennsylvania, Vermont, Washington, Wisconsin, and in the cities of Miami, New York, and Portland.

Mandates for paid sick-days are already in force in Connecticut; Washington, D.C.; Philadelphia; San Francisco; and Seattle. Before such legislation could be implemented in the city of Milwaukee, the Wisconsin state legislature passed a bill that prohibited local authorities from enacting such measures.

All such legislation is based on sick economics.

Mandates that force businesses to provide paid sick-leave or any other fringe benefit are all based on the anti-capitalistic notion that businesses are evil and are always looking for ways to exploit their workers. But if that is true then why do so many companies provide their employees with paid sick-leave and other fringe benefits without the government’s mandating that they do so? The theory of the exploitation of labor is the foundation of Marxism and has no place in a capitalist society. Mandatory sick-leave ordinances are also predicated on the erroneous ideas that businesses, including restaurants and hotels, don’t care if employees come to work sick and are just waiting to fire any employee who requests time-off because he or a family member is ill.

Smart businessmen won’t take sick-leave mandates lying down. In the case of the proposed Orange County ordinance, small businesses can make sure they don’t hire more than 14 people. Larger businesses that offer paid vacation-time can cut it by seven days to make up for the seven days of paid sick-leave that all of their employees would undoubtedly take under the earned-sick-time ordinance. It is economically ignorant to think that businesses should be required to provide paid sick-leave because they can “afford it.” And it is economically foolish to think that businesses required to provide paid sick-leave will not look for ways to offset the cost of doing so.

Regardless of the reasons given by groups who support sick-pay initiatives and lawmakers who enact such legislation, and irrespective of the details of such initiatives, in the end they are all the same in that they are government mandates to employers to provide certain benefits to their employees — just like the mandate in the federal government’s Affordable Care Act that business with 50 or more employees must provide health insurance to their employees or pay a fine. Government employment mandates are anathema to the ideals of limited government, free markets, freedom of contract, and a free society.

Backers of mandatory paid-sick-leave legislation always cite “the public health” as one of the justifications for government intervention in the workplace. But if public health is really the issue, then why not penalize or criminalize the act of coming to work while sick?

Here we also see the hypocrisy and sick economics of conservatives who oppose sick-leave and other fringe-benefit government mandates yet at the same time see no problem with the government-mandated minimum wage and overtime-pay requirements of the Fair Labor Standards Act. Every aspect of employment should be based on voluntary agreements between employers and employees.

Like laws establishing a minimum wage, laws mandating that businesses provide paid sick-leave mean that the government must be able to determine the “correct” or “just” number of hours of sick-leave per hours worked that employees should accrue. But that’s not all. The omnipotent state must also determine all of the related smaller details, such as how much sick-leave can be taken each year, how much sick-leave should carry over to the next year, how many days of sick-leave can be taken without a doctor’s note, what the valid reasons for sick-leave are, how soon after employment begins sick-leave should begin to accrue, how long an employee must work before he can use his accrued sick-leave, and how unused sick-leave should be accounted for upon retirement or severance from the company. All of that, of course, entails Soviet-style central planning.

Mandatory sick-leave ordinances likewise advance the notion that government is responsible for our well-being and prosperity, violate freedom of contract, and imply that there is a right to paid sick-leave.

If government can mandate that employers pay at least a minimum wage, pay overtime for more than 40 hours worked in a week, provide health insurance, comply with the Family and Medical Leave Act, and offer paid sick-leave, then it can also mandate that employers provide paid vacations, life insurance, a pension plan, child care, and any other fringe benefit it dictates. That is fascism.

Oh, and never look to Republicans to reverse the bad policies of Democrats. It has been almost 20 years since the Family and Medical Leave Act was passed. I am still waiting for the Republicans to repeal it.

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