Peter Shawn Taylor is senior features editor of C2C Journal.
A year’s worth of pandemic has provided plenty of spirited debate about lockdowns, vaccine rollouts, travel restrictions and budget deficits. There is, however, one policy response to the pandemic that everyone seems to agree on – paying workers to stay home when they’re sick.
But if paid sick days are really such a popular idea, why are we still talking about it? Because while lots of folks claim to support the concept, no one agrees on what it actually means.
Two weeks ago, a joint statement by Canada’s provincial federations of labour (with the exception of Quebec) declared “it’s time for paid sick leave for every worker in Canada.” This follows a slew of similar pronouncements over the past few months, including from Ontario’s big city mayors and various public health officials. Ahead of a federal/provincial labour ministers’ meeting last week, B.C. Labour Minister Harry Bains said “employers and people with different political backgrounds realize there’s a need for paid sick days.”
And at first blush, that appears to be the case. In December, for example, the Ontario Chamber of Commerce (OCC) put out a statement on paid sick days headlined: “Ontario Chamber Supports Protecting Workers When They Need it Most.” This has been widely cited as proof the business community is fully on board with labour’s call for paid sick days. Not exactly.
The federations of labour say they want “universal permanent and adequate employer-paid sick leave for all workers.” On the other hand, OCC president Rocco Rossi has said he “supports the notion of a temporary paid sick day program that is paid for by government.” This is more than your garden-variety tomayto/tomahto dispute.
A permanent, employer-paid sick day policy constitutes a longstanding demand from labour and the political left, who see it as a way to legislate a boost in employee compensation and create a more worker-friendly, European-style workplace. (Poland mandates up to 33 employer-paid sick days per year.) The pandemic has thus become an opportunity to push through a rather significant labour market reform without much debate.
Meanwhile, the business community has been deliberately vague about what it supports for fear of appearing uncaring. But they certainly don’t want to foot the bill. That’s why employer groups are backing Ottawa’s existing Canada Recovery Sickness Benefit (CRSB), which offers $500 a week for up to four weeks to anyone who has to miss work due to COVID-19 through September. To date more than 400,000 Canadians have accessed nearly $350-million in CRSB benefits, although it’s been criticized for being too stingy and overly complicated.
There are costs and benefits to every public policy. The benefits of paid sick days are obvious to all. Under CRSB, the costs of ensuring sick workers stay home when they’re sick are borne by all taxpayers. This makes intuitive sense given the public good aspects of dealing with a once-in a-century pandemic. And there’s always room to improve CRSB, as a recent move to increase the payout from two weeks to four demonstrates.
The alternative – provincial legislation forcing employers to offer workers a permanent new benefit – entails far greater private costs. According to research by University of Toronto labour economist Morley Gunderson, “Workers clearly respond to the incentives of sick leave in that the more generous the leave provisions … the longer the sick leave that is taken.” When Ontario teachers moved from a banked sick day policy to a use-it-or-lose it system in 2012, sick day claims rose 30 percent in five years
Whether such results suggest a previously unmet need for paid sick days or the opportunistic use of them as extra vacation time, a new employer-paid mandate will inevitably place a significant new burden on all business owners, and especially small business owners, at a very delicate time. If we assume every full-time worker took all paid sick days provided, a new 10-day per year employer-funded sick day requirement could add four to eight per cent to annual payroll costs, depending on how owners make up for the missing work. And without any improvement in productivity.
That’s no recipe for a robust post-pandemic recovery.
We can have a debate about the merits of employer-paid sick days once the recovery is underway and there’s time to fully assess the advantages and disadvantages. But a temporary crisis calls for a temporary solution.
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