Rich Meneghello//December 6, 2012//
As if employers didn’t have enough to worry about, there is a strong likelihood that Portland City Council soon will vote on a proposal that would require many or perhaps all employers within city limits to provide some form of paid sick leave to their employees. Although advocates of the proposal believe it will provide a much needed benefit to Portland residents, most employers are concerned about the potential economic and administrative burdens.
The past year saw an expansion of paid sick laws pop up across the country. The state of Connecticut and the cities of Philadelphia and Seattle passed laws requiring this benefit for a portion of their workforces, joining San Francisco and Washington, D.C. Now, worker advocates in Oregon have set their sights on Portland joining their ranks as soon as possible.
They point to the fact that no fewer than 40 percent of workers in the country lack any form of paid sick leave, and miss out on needed income when they or a close family member gets sick. And if they drag themselves to work, they expose co-workers and customers to germs while operating at a reduced capacity.
What would Portland paid sick leave look like? It’s hard to say, because no specific proposal has been publicly tendered to City Council, but an examination of one of the suggested proposals and some other existing laws might provide a glimpse into our future.
One concept would require Portland businesses to pay one hour of sick leave for every 30 hours worked by the employee, regardless of whether the employee is full-time, part-time, or temporary. The employee could carry over as many as 40 hours of leave to the next calendar year, and could use the leave time for a personal illness or to care for a family member.
If the City Council were to instead look to Seattle’s new paid sick leave law as a model, employers should prepare for a regulatory headache: It includes three sets of rules (depending on the size of the employer), with smaller businesses with at least five employees required to offer at least five sick days per year, and the largest employers providing nine full sick days. Employers need to provide a written account of available paid sick time each time they pay their workers, and must post a required notice of the law in a conspicuous location. Workers accrue paid sick leave at various rates, and the work Seattle employers must do to pull their existing policies into compliance with the new laws is nightmarish.
San Francisco’s ordinance requires employers to maintain for their workers a rolling bank of up to 72 hours of paid sick leave; Washington D.C.’s ordinance requires a seven-day amount. Connecticut’s new law covers only employers with at least 50 workers, and affords them 40 hours a year for paid sick time.
Employers often cite two main reasons why they oppose paid sick leave: the economic cost and the administrative burden. From an economic standpoint, it is often the case that wage raises, health care and vacation time are consistently the three biggest priorities for employees. Employers would be hamstrung in their ability to offer or increase these incentives to their workers if their bottom lines were affected by paid sick leave.
Moreover, with the uncertainty swirling around over the looming presence of Obamacare and the rise in costs that will bring, many employers are concerned that an additional expense might cost them their ability to effectively manage their operations. From an administrative standpoint, it’s hard to predict how daunting compliance might be until a specific proposal emerges as the favorite, but among the concerns employers have is how to navigate the thicket of requirements that will emerge for companies that operate both inside and outside of city limits.
Some people might be willing to accept some form of paid sick leave, but only if it were to apply to just those larger employers who can more easily bear the burden, such as those with at least 25 or 50 workers. However, one of the leading advocates for the 鈥淓veryone Benefits鈥 coalition maintains that they want a rule that would apply to all Portland workers, regardless of employer size. How this will shake out is unknown, and may be a negotiating point after the initial proposal is floated to the city.
Two City Council members, Amanda Fritz and Randy Leonard (who is departing at the end of the year), support the concept in general terms, while two members (Mayor Sam Adams and Nick Fish) have not yet taken a public position. The fifth member, Dan Saltzman, has expressed hesitation of the city tackling what he believes to be a matter best left for the state Legislature.
That brings up a very good point: Should a city be in the business of interfering with business to such a degree? Shouldn’t the state government, which has the capacity and experience of enforcing state labor and employment laws, be the better entity to pass and enforce paid sick leave? Also, does the city have sufficient resources and expertise to administer and enforce such an expansive law?
Many observers question whether the city government, which has consistently been unable to provide basic services in an effective and economical manner, is competent to handle this task. It is possible that City Council might try to ram through a proposal before the terms of Mayor Adams and Commissioner Leonard end on Dec. 31. But given the complexity of the matter, its potential impact, and the certain divergent opinions that will emerge, it is more likely this topic will be debated in earnest in 2013.
Rich Meneghello, managing partner of the Portland office of Fisher & Phillips LLP, is dedicated to representing the interests of management. Contact him at 503-205-8044 or [email protected], or follow him on Twitter 鈥 .