Both of these things can be (and are) true: Paid sick leave is a wonderful employee benefit, particularly during a pandemic, when we’re all worried about our family’s health. And government has no business mandating paid sick leave policies.
A new Austin American-Statesman editorial calls on the state of Texas and Gov. Greg Abbott to drop all opposition to city ordinances that mandate paid sick leave for businesses (full disclosure: my group, the Texas Public Policy Foundation, has led the fight against mandatory paid sick leave ordinances in court).
“The sad fact is that Abbott and other state leaders have long fought policies that would help Texans face a public health threat like the COVID-19 pandemic,” that editorial reads. “Now those decisions will come home to roost.”
That sounds ominous. But it’s wrong, and here’s why.
First, there’s the simple rule that you shouldn’t set ordinary policy based on extraordinary circumstances. The current pandemic will, eventually, subside. But policies made permanent won’t. So those small businesses with razor-thin margins would be burdened with those costs long afterward. Other businesses, which have chosen a different set of employee benefits that better suits their needs and those of their workers, would still be forced into the city’s one-size-fits-all approach.
Next, the facts don’t line up with the Statesman’s headline, which says “In a pandemic, paid sick leave protects us all.” Washington state has mandatory paid sick leave, yet it was the first epicenter of the outbreak in the U.S.
And with this particular virus, those who have it can be contagious long before they feel any symptoms. There’s just no empirical evidence that this policy would have a meaningful public health impact. Forcing businesses to offer paid sick leave isn’t a panacea.
But the thing is, we don’t have to force businesses. Most employers already offer paid time off, and many of the ones that don’t yet are doing so in light of the coronavirus—without a big government mandate.
Walmart, Apple and the parent company of Olive Garden are all revising their policies. Uber and Lyft will pay drivers who are diagnosed or quarantined with the virus.
Walmart sent a letter to its employees, noting that “Your health is our priority, and, as we’ve said before, we want any associate who is not feeling well to stay home. So, we have created a COVID-19 emergency leave policy, which is effective immediately, to ensure you have the support you need.”
And Amazon is offering paid sick leave to all of its workers who contract the virus, including part-timers.
There’s no mystery here; before the outbreak, low unemployment numbers and a tight labor market were incentive enough for employers to offer attractive benefits to appeal to new workers and to retain existing employees. The coronavirus outbreak just reinforces the point that paid sick leave is a very attractive benefit, and well worth offering in most cases.
There’s simply no need to get government involved. Government has a very limited role in employer-employee relationships; those are voluntary arrangements worked out between those two parties. And every such relationship is different; a government-driven one-size-fits-all approach will inevitably create losers in the marketplace.
Besides that, mandatory paid sick leave ordinances are unconstitutional. Texas law is clear; the state sets the minimum wage, and cities aren’t allowed to make rules for employee compensation that exceed that (as paid sick leave ordinances would do).
It’s too early to know yet the full effects of the outbreak. We know the economy is taking a hit, and restaurants and many other small businesses are suffering disproportionately. Saddling them with additional financial burdens now doesn’t make sense.