TO: Hon. Dereck Davis, Chair, and members of the House Economic Matters Committee

FROM: Elise Gould, PhD, Director of Health Policy Research, Economic Policy Institute

Thank you for the opportunity to discuss how the Maryland Earned Sick and Safe Leave Act would impact employers, workers, families, and the general public. The Economic Policy Institute’s mission is to inform and empower individuals to seek solutions that ensure broadly shared prosperity and opportunity. I support the Maryland Earned Sick and Safe Leave Act because it gives workers the ability to earn paid sick days, protecting worker’s ability to provide for and care for themselves and their families. In addition, while the costs to business owners are practically negligible, both businesses and the people of Maryland will gain from a more
productive and healthier workforce.

Earned sick time is a wise investment for Maryland’s employers, workers, and general public. The many employers that already provide paid sick leave would have a level playing field with their competitors, and all would more easily maintain a healthy workplace. While any new labor standard generates concerns about the business climate and job creation, the evidence from jurisdictions that have legislated earned paid sick days has all been positive. The first jurisdiction to set a paid sick days standard was San Francisco, where employers have been required to offer earned paid leave since 2007. Fears that the law would impede job growth were never realized. In fact, during the last five years, employment in San Francisco grew twice as fast as in neighboring counties that had no sick leave policy. San Francisco’s job growth was faster, according to the Institute for Women’s Policy Research, even in the food service and hospitality sector, which is dominated by small businesses and viewed as vulnerable to additional costs.

Connecticut became the first state to enact a sick-days standard last year, and it is too early to speak definitively about its experience so far, but my Economic Policy Institute colleague Doug Hall and I calculated the potential impact of Connecticut’s law before it passed and concluded that the cost of allowing employees to earn five days of paid sick leave a year would be very small relative to sales. If Connecticut employees with no sick leave were given the ability to earn five days of paid leave and used it as much as employees who already had access to leave, the cost was predicted to be only 0.19 percent of sales, including firms of all sizes. For employers already providing five or more days of leave, there would be no cost at all. Further, while any additional costs may be easily absorbed through small changes in other forms of compensation, hours, prices, or profits, earned sick time may actually save employers money through reduced turnover and higher productivity.

There is no reason to think the impact on business in Maryland would be any different from the experiences in San Francisco and Connecticut. The Maryland Earned Sick and Safe Leave Act explicitly levels the playing fields between all employers, raising the quality of jobs across the board. The earned paid sick time is accrued at a reasonable pace, one hour for every thirty hours worked, capped at seven full days per year for full-time workers. Part-time workers are treated accordingly at a rate commensurate with their hours worked. This provides no extra burden to employers, and removes any incentives to reduce hours of workers who rely on full-time employment to provide for themselves and their families.

Currently, 40 percent of private sector employees nationwide cannot earn paid sick days, and lower-paid service workers in the restaurant and fast-food industries are particularly unlikely to have this safeguard. Food service workers, health care workers, child care workers and others who come into physical contact with the public or handle our food are among the least likely to be able to earn paid sick leave. There can be serious consequences when infected employees go to work, as happened with an estimated 8 million people during the peak of the H1N1 flu virus outbreak several years ago.

Opening access to paid sick days for more than 700,000 Maryland workers who do not have access will mean stronger, healthier families. Working parents are often forced to choose between staying home with a sick child and going to work. When parents cannot take off work, children are sometimes sent to school ill, diminishing their learning experience and exposing other students, teachers and staff to infection. When employees go to work sick, they endanger their own health and the health of their colleagues while jeopardizing safety and the quality of their work. At the same time, staying home and putting one’s own health first can result in overdue bills and not having enough food to eat.

You have the opportunity to give workers the ability to earn paid sick days, avoiding the choice between going to work sick or going without pay (and maybe even losing a job). Thank you for giving me the opportunity to provide evidence in support of the Maryland Earned Sick and Safe Leave Act. I respectfully urge you to seize the opportunity to take the lead in quality job creation and sensible public policy and return a favorable report.