In mid-February, Austin made history by becoming the first city in the South to implement a mandatory paid sick leave policy. Austin locals can finally breathe a stuffy-nosed sigh of relief, as they no longer have to jeopardize their health in pursuit of a paycheck. Over the last 10 years, nearly 40 state and local laws on paid sick leave have been enacted, eight being state laws. Currently, a majority of these policies are concentrated in areas such as California and New York.
The Austin ordinance is set to provide sick days to around 87,000 workers. It allows for workers to accrue up to eight days, or 64 hours of paid sick leave, assuming 8-hour work days. Small businesses with 15 or fewer employees could have paid sick days up to 48 hours, or 6 days of leave.
Unfortunately, state lawmakers have met the ordinance with great resistance, some even vowing to strike it down. Those opposed to the new regulation claim that it hurts small enterprises in the city and disincentives the creation of new businesses due to the pressure of paying for paid sick leave.
Although these claims lack empirical evidence, the ordinance does raise questions on how businesses will adapt. It’s inevitable this policy will have an impact on businesses around the city, but there has been little discussion on the specific steps businesses will have to take to adjust. The city failed to gather any input from local businesses about the projected economical impact of the mandate.
The numbers used in the proposal to project the number of workers affected and the impacts on businesses came from national labor estimates. The ordinance passed with little regard to the local business climate. Austin currently has a vastly different culture for companies compared to other cities due to its small business scene and smaller size. This makes it difficult for businesses to anticipate the effect of the reforms they have to adopt.
Austin has a thriving small business culture. From 2010 to 2013, Austin led the nation in the growth of the number of small businesses (those with 50 employees or fewer) at around 7 percent overall. Austin had 44,163 small businesses in 2013 — or 2,342 for every 100,000 residents. And it is true that small businesses are often apprehensive about adopting measures such as paid sick leave due to their reliance on a limited number of workers.
Austin is markedly different from other cities that have implemented paid sick leave policies. Many of the other city-only paid sick leave policies are found in larger cities. Four of the top five most populous cities in the country enforce mandatory paid sick leave. Austin’s population is far from the population of these areas. Additionally, in many of these cities, employment is dominated by large corporations, which often have the resources to provide better benefits to their employees. In a city where so much is left up to smaller employers, there should have been better preparation and evaluation of such policies.
Before the mandate is set to go into motion in October of this year, the City of Austin needs to account for the voice of business. Complaints from small business owners should not be dismissed as being born out of a partisan divide. Rather, there should be a cooperative effort by both parties to ensure that for both employers and employees, paid sick leave is an Austin triumph for both employers and employees
Krishnan is a computer science major from Plano.
