Sick leave provides pay to employees when theyâ€™re out of work due to illness. Most sick leave policies grant full pay for special number of sick daysâ€”usually up to about 12 per year. The sick days usually accumulate at the rate of, say, one day per month of services.
Sick leave pay causes difficulty for many employers. The problem is that while many employees use their sick days only when they are legitimately sick, others use sick leave as extensions to vacation, whether they are sick or not. In one survey, for instance, personal illnesses accounted for only about 45% of unscheduled sick leave absences. Family issues (27%), personal needs (13%), a mentality of â€œentitlementâ€ (9%), and stress (6%) were other reasons cited. While the figure varies considerably by size of firm, unscheduled absenteeism for all employers averages about 1.6% of all scheduled work hours. Thus, a company with 10 employees and a 40-hour work week might expect to have employees calling in with unscheduled absences at the rate of about .016 X 400 or 6.4 hours per week. One survey found that the average cost of absenteeism per employee per year was $789 in 2002, with personal illness accounting for about a third of the absences.
Employers have tried several tactics to reduce the problem. Some repurchase unused sick leave at the end of the year by paying their employees a daily equivalent sum for each sick leave day not used. The drawback is that the policy can encourage legitimately sick employees to come to work despite their illness. Others have experimented with holding monthly lotteries in which only employees with perfect monthly attendance are eligible for a cash prize. Marriott has a program called BeneTrade through which employees can trade the value of some sick days for other benefits. Others aggressively investigate all absences, for instances, by calling the absent employees at their homes when they are out sick.
Many companies use pooled paid leave plans. These plans lump together sick leave, vacation, and holidays into a single leave pool. Their use grew from 21% of firms surveyed about five years ago to 66% recently. For example, one hospital previously granted new employees 25 days off per year (10 vacation days, three personal days, and 12 sick days). Employees used, on average, five of those 12 sick days (as well as all vacations and personal days). The new pooled paid leave plan allowed new employees to accrue 18 days to use as they saw fit. â€œCatastrophic leavesâ€ â€“ defined as short term illnesses causing for more than five consecutive workdays, as well as special absences like jury duty and bereavement leave were handled with separate accounts. The new plan reportedly resulted in a saving of almost $400,000 over three years in lower overtime, and $350,000 in reduced temporary help.
Parental leave and the family and Medical Leave Act:
Parental leave is an important benefit. About half of workers are women, and about 80% will become pregnant during their work lives. Furthermore, many women and men are heads of single parent households. Partly as a response, former president Clinton signed the Family and Medical Leave Act of 1993 (FMLA). Among its provisions (as noted earlier) the law stipulates that:
1. Private employers of 50 or more employees must provide eligible employees up to 12 weeks of unpaid leave for their own serious illness, the birth or adoption of a child, or the care of a seriously ill child, spouse, or parent.
2. Employers may require employees to take any unused paid sick leave or annual leave as part of the 12-week leave provided in the law.
3. Employees taking leave are entitled to receive health benefits while they are on unpaid leave, under the same terms and conditions as when they were on the job.
4. Employers must guarantee employees the right to return to their previous or equivalent position with no loss of benefits at the end of the leave; however the law provides a limited exception from its provisions to certain highly paid employees.
Seven states (California, Illinois, Louisiana, Massachusetts, Minnesota, North Carolina, and Vermont) and the District of Columbia have expended upon the Family Medical and Leave Act by instituting â€œsmall necessities leaveâ€ laws. These provide leave for things like visiting physicians and attending school activities. —