Prepared for Think NC First by Marion T. Johnson

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1. Definitions
2. Introduction
3. Life without paid leave
3.1 An undue economic burden
3.2 Public health risks
3.3 A weaker workplace
4. Life with paid leave
4.1 Paid sick days and paid family leave in the U.S.
4.2 How have paid sick days and paid leave worked?
4.3 How would paid sick days work in North Carolina?
4.4 How would paid family leave work in North Carolina?
5. Conclusion
6. References

1. Definitions [back to top

Paid sick days – short-term time off from work to recover from illness, seek medical attention, or care for an ill family member.

Paid family and medical leave – long-term time off from work to recover from a long-term illness or injury, care for a family member with a long-term illness or injury, or care for and bond with a new child (adoption, birth, or foster).

2. Introduction [back to top]

Imagine you work in an office with about 60 employees or so. You can hear your co-worker Janet coughing down the hall – her toddler is sick, and she must have caught the same cold. Her assistant Todd has been coughing a bit as well. There’s a poster in the break room about hand washing and safer coughing techniques, and it recommends that people stay home if they aren’t feeling well. Still, your office doesn’t provide paid sick days, so Janet and Todd came in anyway.

You decide to grab some lunch at the nearby sandwich shop. The guy who prepares your sandwich is coughing and sneezing. When you ask him if he’s okay he smiles sheepishly and says a bug’s been going around the kitchen. As he hands you your sandwich, you start to feel a tickle in your throat.

Don’t you wish that Janet and your sandwich guy had just stayed home sick?

But for a large number of North Carolinians, staying home sick isn’t a viable option. Thirty-nine percent of North Carolina’s private sector workers lack paid sick days.[i] That’s 1.2 million North Carolinians who can’t call in sick without losing pay – or their job. That percentage ticks up slightly to 40 percent when you just look at female workers like Janet, and jumps all the way up to 77 percent for food service workers like the sandwich guy and his team.[ii]

The Centers for Disease Control and Prevention recommends that people stay home, get rest, and avoid contact with others when they have a contagious illness like the flu. But that health recommendation doesn’t help someone who literally can’t afford to miss a day of work.

For a large number of North Carolinians, staying home sick isn’t a viable option. Thirty-nine percent of North Carolina’s private sector workers lack paid sick days.

Paid sick days aren’t just about the workplace, either. Sixty-eight percent of North Carolina children under the age of six live in homes where all available parents work,[iii] but not all of those parents can be home when their child gets sick. The problem is even worse for families with young children, since the average toddler gets sick between five and ten times a year. For a working parent, that could be five to ten workdays without pay. And since the median household income in North Carolina has been falling for the last seven years,[iv] fewer and fewer working parents can afford to miss that many days.

Over 85 percent of workers in the South also lack paid family and medical leave. Unfortunately, that number doesn’t match the number of workers who will need that leave to care for a newborn or a family member suffering from a chronic illness.

In North Carolina alone, over one million people care for adult family members, partners, or friends suffering from chronic illness. The majority of caregivers have been employed at some point during their caregiving experience.[v]  Without paid family leave, those family members have to choose between foregoing a paycheck to fulfill their caregiving needs and spending less time providing care for their family members.

Mother and sick child

The lack of paid leave access doesn’t affect all workers in the same degree. But it does cause three kinds of problems for North Carolina workers – and their employers. It puts an undue economic burden on low-wage working families. It leaves communities vulnerable to public health issues. And it weakens the workplace through lost productivity and high turnover.

So what does the solution look like? For business owners, they will see lower turnover (and lower turnover costs), higher productivity, and fewer occupational injuries.[vi] For workers, it means having the time to bond with and care for a new child, or going to the doctor instead of delaying, without worrying about a missed paycheck.

Take Anne Quirk, a Rhode Island resident who unexpectedly had to take extra time off from work after her obstetrician ordered her on bed rest before she gave birth. Fortunately for Anne, Rhode Island offers paid family leave. As she explains,

It was just such a stress reliever, knowing there was going to be money to help us pay the bills. I don't know what we would've done without it.”[vii]

Paid sick days and paid leave would make an enormous difference for working North Carolinians, and could make stories like Anne’s the norm rather than the exception.

3. Life without paid leave [back to top] 

3.1 An undue economic burden 

Paid sick days are much more common in high-wage sectors like law, engineering, and business. Meanwhile, workers in food preparation and service see the lowest rates of access as well as the lowest average wages. The people least able to afford missing a paycheck or losing their job altogether are the ones most often forced to risk just that if they get sick. Low-wage workers are more likely to report that they didn’t take the leave they needed because they “could not afford loss of income.”[viii]

Over 60 percent of full-time workers earning less than $20,000 a year lack paid sick days access, and that share dwindles as you move up the income ladder. Less than 20 percent of workers making over $65,000 a year lack paid sick days.

Figure 1

If the illness becomes a long-term problem, or a family member needs long-term care, unpaid leave can only do so much good. Almost 10 percent of workers who take unpaid family leave use some form of public assistance during that leave.[ix] Since their workplace doesn’t offer paid leave, these workers have to use food stamps or TANF instead of supporting their family on their own.

Figure 2

The Economic Policy Institute found that a two-child family with two working adults[1] would lose their entire health care budget after three missed days of work. That same family with a single working parent would fall below the federal poverty line after three missed days in one month.[x]

3.2 Public health risks [back to top] 

Adults without paid sick days are 1.5 times more likely to report going to work with a contagious illness. These workers are also more likely to delay seeking medical attention, which increases the odds of a short illness becoming a long one, and a minor health issue becoming a major – and majorly expensive – health issue. This makes paid sick days a public health issue on two fronts: workers are staying ill longer, which exacerbates illness on an individual level; and workers are making their co-workers and customers sick, which exacerbates illness on a community level.

The Institute for Women’s Policy Research found that paid sick days are associated with better self-reported general health among workers and lower usage of hospital emergency departments, regardless of insurance status.[xi] Workers with paid sick days are also less likely to delay their own or their family member’s medical care.

“1.3 million hospital emergency department visits could be prevented in the U.S. each year by providing PSD to workers who currently lack access, reducing medical costs by $1.1 billion annually, with over $50 million in savings for public health insurance programs.”[xii]

The public health issue becomes particularly pronounced in the food service industry, where few workers have paid sick days or paid leave. In North Carolina, 77 percent of employees in the food preparation and serving industry lack paid sick days.[xiii] The vast majority of North Carolinians whose jobs depend on interacting with the public and preparing food are the most likely to have to come to work sick or lose a paycheck. 

The National Partnership for Women and Families illustrates this critical point with an example from a 2008 norovirus outbreak. “In 2008, when a worker at a Chipotle restaurant in Kent, Ohio, had no choice but to come to work sick with the norovirus, more than 500 people become violently ill. The outbreak cost the Kent community between $130,233 and $305,337.80.”[xiv]

In a report by the Restaurant Opportunities Centers United, 63 percent of surveyed restaurant workers reported cooking and serving food while sick.[xv] Another study found that one in eight restaurant workers had to work while suffering from vomiting or diarrhea.[xvi] And most of these employees couldn’t afford the emergency room bill they’d get if their minor illness became major.

63 percent of restaurant workers reported cooking and serving food while sick.

Parents are also sending their children to school when they’re sick, because they can’t take a day or two off from work to care for them. Lacking paid sick days puts parents in the awful position of choosing between financially supporting their family or caring for their ill child. More and more parents have to make the decision to send their child to school, running the risk of getting other children sick and prolonging their own child’s illness.

3.3 A weaker workplace [back to top]

It may seem counterintuitive that offering paid time off would increase productivity. And indeed, opponents argue that paid leave will lead to absenteeism – lost productivity due to missed work hours. But the data tell a different story. One study estimated that presenteeism – the decreased productivity from working while sick – costs employers an average of $255 per employee every year.[xvii] Since sick employees are less productive, less work gets done. Sick employees coming in to work also increase the chances that their co-workers will get sick, which can cause a domino effect of lost productivity.[xviii]

There’s also the issue of high turnover rates, which are especially prevalent in service industry positions. Turnover costs – having to find and train new employees to replace those who have left - average an estimated one-fifth of an employee’s annual salary.[xix] The less access workers have to paid leave and paid sick days, the higher their turnover rates, and that leads directly to higher costs for employers. The high turnover also means that workers – often low-wage workers – are constantly looking for employment rather than developing a strong, consistent employment history.

white mom and sick child

Finally, a lack of paid leave makes workplaces especially hostile for female workers. Women are much more likely to serve as their family’s primary caregiver, especially when it comes to caring for a new child. But a recent In These Times report found that roughly a quarter of American women return to the workplace within two weeks of giving birth.[xx] In North Carolina alone women head more than 500,000 family households,[xxi] so in the absence of paid leave a quick return to the workplace is a financial necessity. This is especially true for the third of female-headed North Carolina households who live below the poverty line.[xxii] Low-income women reported money as the primary reason they came back to work so soon. With only unpaid leave to rely on, these women couldn’t afford more than two weeks without pay. 

Roughly a quarter of American women return to work within two weeks of giving birth. Low-income women reported money as the primary reason.

Women without leave also miss out on the associated health and financial benefits. Longer maternity leaves are associated with a decrease in depressive symptoms, a lower likelihood of severe depression, and an increase in overall maternal health.[xxiii] And new mothers who take paid leave are more likely to still be in the workforce nine to twelve months after childbirth, and specifically are more likely to return to their employer.[xxiv]

“One national study of 1,762 mothers found that a one-week increase in maternity leave was associated with a 5 to 6 percent reduction in depressive symptoms from six to 24 months after birth. Another found that women who took less than eight weeks of paid leave experienced more depression than those who had longer leaves and were in worse health overall.”[xxv]

Businesses are starting to see the value of offering generous leave policies. In a recent National Public Radio news report, benefits manager Bruce Elliott said that “companies view leave benefits as a recruitment tool, especially in fields where talent is scarce, or where companies are trying to attract more female workers.”[xxvi]However, so far these leave policies still primarily apply to highly paid white-collar workers. 

4. Life with paid leave [back to top]

4.1 Paid sick days and paid family leave in the U.S. 

In June 2015, Oregon became the fourth state to pass a statewide paid sick days initiative, joining California, Connecticut, and Massachusetts. All four states use an accrual system: employees accrue paid sick time through hours worked, either as soon as they begin working or after a waiting period. All four states also include safe time – that is, when an employee needs to take time off due to domestic violence or sexual assault. Table 1 breaks down how each state law works with regards to maximum time allowed, accrual rate, coverage, allowed usage, and definition of family.

Table 1

In addition to these four states, 18 cities have passed their own paid sick days initiatives: Emeryville, Oakland, and San Francisco, CA; Washington, DC; Jersey City, Newark, Passaic, East Orange, Paterson, Irvington, Trenton, Montclair, and Bloomfield, NJ; New York City, NY; Philadelphia and Pittsburgh, PA; and Seattle and Tacoma, WA. California, New Jersey, and Rhode Island are the only states that provide paid family leave.[1] All three states fund their programs through employee payroll taxes (New Jersey also funds theirs through employer payroll taxes), and administer them through state disability programs. Table 2 details how each state’s policy works in terms of funding, maximum duration of leave, wage replacement amount, coverage, allowed usage, and definition of family.

Table 2

4.2 How have paid sick days and paid leave worked? [back to top]

The business community tends to have the strongest objections to paid sick days and paid leave mandates. The arguments generally break down into two categories: 1) concerns about jobs, and 2) concerns about productivity. Job creators won’t appreciate the burden on their bottom line, the argument goes, and will leave the state for somewhere with fewer workplace protections. Absenteeism and leave abuse will kill workplace productivity and hurt businesses even more. Yet actual experience has proven the opposite.

Data and personal accounts from the cities and states with such laws show that paid sick days and paid leave absolutely pay off, for both employees and employers. 

“One manager…had expected a large increase in costs. He had actively lobbied against the state paid sick leave bill before it was passed into law. He told us, however, that he now realized that his fears had been unwarranted: "The impact has been less than anticipated," he stated, adding that in regard to the impact on costs, "It doesn't even hit the radar screen."”[xxvii]

San Francisco passed the first citywide paid sick days law in 2007. Despite opposition from the business community at the outset, there have been few complaints since the city implemented the law. Over 70 percent of employers have reported no impact on profitability, while 15 percent said that they “didn’t know” what impact it had. Two-thirds of employers now express support for the law.[xxviii]

“By and large, this has not been an employer issue. San Francisco’s economy is booming.” Jim Lazarus, senior vice president for policy at the San Francisco Chamber of Commerce.

“Initially there were a lot of complaints and concerns. We don’t hear those anymore.” Donna Levitt, San Francisco’s Office of Labor Standards Enforcement

Washington, DC’s law, which was expanded to include tipped minimum wage employees in 2013, has been similarly successful. The Office of the District of Columbia Auditor found “no evidence that the law prompted businesses to leave the city or discouraged employers from establishing new businesses in it.”[xxix]

In 2011, the Economic Policy Institute estimated the business cost of Connecticut’s paid sick days law. Using industry-specific data, researchers Doug Hall and Elise Gould found that the cost to employers who weren’t previously providing paid sick days would average 0.05 percent of sales.[xxx] Similarly, the Center for Economic and Policy Research (CEPR) conducted a Connecticut survey in 2014 that concluded:

“There is no evidence that the paid sick days law has been a ‘job killer’; on the contrary, in the period since it took effect, employment levels rose in key sectors covered by the law, such as hospitality and health services, while employment fell in manufacturing, which is exempt from the law.”[xxxi]

New Jersey’s path to paid sick days has been less direct. Nine cities in the state have passed their own legislation, including Jersey City, Trenton, and Newark. But without support from the state legislature, and with hostility from the governor’s office, these cities compose an uneven patchwork of coverage.

On the paid leave front, employees in California, New Jersey, and Rhode Island have filed the vast majority of leave claims for time to care for and bond with a new child. The majority of employers in these states report positive impacts from the paid leave laws, including increased productivity and performance.[xxxii] The federal government has taken notice of the successes at the state and city level and moved to replicate them. In early September 2015, President Barack Obama issued an executive order that will allow employees of federal contractors to earn up to seven paid sick days a year. About 300,000 workers nationwide will gain paid leave benefits, but that’s still just a fraction of the nearly 44 million Americans working in the private sector who lack paid sick days. (1.2 million of those Americans live and work in North Carolina.)

white dad and sleeping baby

The U.S. Department of Labor’s Women’s Bureau then awarded $1.55 million to eight states and cities to research paid family leave implementation or expansion,[xxxiii] including North Carolina neighbor Tennessee. The grant builds upon a smaller grant from 2014, a scale-up represents a growing commitment to paid family and medical leave. But for now, the ultimate goal of implementation is still up to the states.

"Most of my family have the type of jobs that if you don't go to work, you don't get paid. So even though I was sick and my daughter wanted to be with me, I had to recover on my own…when I was diagnosed the second time, the New Jersey paid family leave insurance was in effect. [My daughter] was able to be with me during my recovery. It strengthened my spirit and my healing.” – Permelia Toney-Boss, New Jersey resident and cancer survivor [xxxiv]

As the human resources manager of an electronics company reported, paid family leave “helps people when they are at their most vulnerable… [and] once they are back here, they are focused, not putting together pieces of the things that have fallen apart (in their life) while they were out. They can really jump back in.”[xxxv]

4.3 How would paid sick days work in North Carolina? [back to top] 

North Carolina lawmakers have proposed paid sick days legislation a number of times in the recent past. In the 2015 Session Representatives Fisher, Farmer-Butterfield, and L. Hall introduced HB 270, which would allow workers to earn an hour of paid sick time for every 30 hours worked, up to 4 days a year for small businesses[1] and up to 7 days for all other businesses.[xxxvi] HB 270 would have given paid sick days access to all private sector workers while also remaining business-friendly by including a lower cap for small businesses.

The Oregon state legislature also recently proposed a unique paid sick days idea – a tax credit for small business employers who provide paid sick days. The reimbursement rate would begin at 75 percent of wages, and decrease to 25 percent by 2019. Legislation like this could help small businesses defray upfront costs they may encounter when starting a new policy, while still offering employees the protection they need.

4.4 How would paid family leave work in North Carolina? [back to top] 

North Carolina currently provides 12-26 weeks of unpaid, job-protected family and medical leave. In the 2015 Session Representatives Fisher, Farmer-Butterfield, Cunningham, and L. Hall introduced HB 269 to expand the state’s definition of family to include siblings, grandparents, grandchildren, step-parents, and parents-in-law.[xxxvii] But expanding the definition of the family is only small step in the right direction.

Existing paid family leave laws use an employee insurance structure administered through state labor departments’ temporary disability programs. Employees pay a small amount – usually less than one percent of their paycheck - into the system to cover the leave they might need. The system then pays out a certain majority percentage of their weekly salary, with a maximum weekly benefit. Rhode Island’s law provides the most employee protection, by including anti-retaliation language so that employees don’t feel pressured out of taking their leave.  

5. Conclusion [back to top]

The recent shift in state economic policy has hurt North Carolina workers and families. Changes to the tax code, like eliminating the Earned Income Tax Credit and Child and Dependent Care Credit, effectively raised taxes on low- and middle-income families. Cuts to unemployment benefits have targeted those hurt most by swiftly changing economic trends. On top of that, the state legislature eliminated the family hardship provision of the unemployment law, meaning workers that were forced to leave work to care for a sick family member are no longer eligible to receive unemployment benefits.

While state policy has negatively impacted workers, the state’s economic growth isn’t being shared equitably. Nearly 6 in 10 of the new jobs North Carolina has created since the recession pay poverty-level wages.[xxxviii] Median household income has fallen since 2007, bringing North Carolina down to 41st in the nation.[xxxix] Working families are under siege. They need – and deserve – better.

Thanks to all of these trends, our state is making headlines for all the wrong reasons. North Carolina is losing high-profile economic development battles to South Carolina and teachers are leaving for other states like Texas. As each state budget spends less on education, infrastructure, and the social safety net, it paints an increasingly unattractive portrait of North Carolina for job seekers and job creators.

Passing paid sick days and paid family leave legislation in North Carolina would relieve economic stress on working families, help defend communities against public health issues, and strengthen workplaces. It would also signal to workers and job creators that North Carolina is a good place to work and do business, thus giving North Carolina a competitive advantage over neighboring states. Not only does it make economic sense – it’s also the right thing to do.


6. References [back to top] 

[1] North Carolina defines “small businesses” as those with fewer than 500 employees.

[2] Washington State passed a paid family leave law in 2007, but the law was never implemented and subsequent state legislation has postponed it indefinitely.

[3] At the average wage for workers without paid sick days, $10/hour.

[i] Institute for Women’s Policy Research. (2014). “Research Brief: Access to Paid Sick Days in North Carolina.” Available at

[ii] See note i.

[iii] The Annie E. Casey Foundation. (October 4 2014). Kids Count Data Center. “Children under age 6 with all available parents in the labor force.” Available at,868,867,133,38/any/11472,11473

[iv] Quinterno, John. (April 2015). A Comeback Short of the Mark: Income Trends in North Carolina in the Wake of the Great Recession. Think NC First. Available at

[v] NC Families Care. (2014). “Get the Facts on Family Leave Insurance.” Available at

[vi] See note i.

[vii] Associated Press. (May 25 2015). “In R.I., some residents gush about paid family leave.” Available at

[viii] The Executive Office of the President, Council of Economic Advisers. (June 2014). The Economics of Paid and Unpaid Leave. Available at

[ix] Houser, Linda and Vartanian, Thomas P. (January 2012). Pay Matters: The Positive Economic Impacts of Paid Family Leave on Families, Businesses, and the Public. The Center for Women and Work at Rutgers. Available at 

[x] Green, Andrew; Filion, Kai; Gould, Elise. (2011). Economic Policy Institute. The Need for Paid Sick Days.

[xi] Miller, Kevin; Williams, Claudia; Yi, Youngmin. (2011). Institute for Women’s Policy Research. Paid Sick Days and Health Cost Savings from Reduced Emergency Department Visits.

[xii] See note xi. 

[xiii] See note i

[xiv] National Partnership for Women & Families. (April 2013). “Paid Sick Days Improve Our Public Health.” Available at

[xv] Restaurant Opportunities Centers, United. (September 30, 2010). Serving While Sick: High Risks & Low Benefits for the Nation’s Restaurant Workforce, and Their Impact on the Consumer. Available at

[xvi] Sumner, Steven et al. (October 1 2010).  Factors Associated with Food Workers Working while Experiencing Vomiting or Diarrhea. Journal of Food Protection, Vol. 74, No. 2, 2011, Pages 215–220. Available at

[xvii] Goetzel, R.Z., Long, S.R., Ozminkowski, R.J., Hawkins, K., Wang, S., & Lynch, W. (April 2004). “Health, Absence, Disability, and Presenteeism Cost Estimates of Certain Physical and Mental Health Conditions Affecting U.S. Employers.” Journal of Occupational and Environmental Medicine.

[xviii] See note xvii.

[xvix] Boushey, Heather and Glynn, Sarah Jane. (November 16 2012). There Are Significant Business Costs to Replacing Employees. Center for American Progress. Available at

[xx] Lerner, Sharon. (August 15 2015). The Real War on Families: Why the U.S. Needs Paid Leave Now. In These Times. Available at

[xxi] Institute for Women’s Policy Research. (January 2013). The Status of Women in North Carolina.

[xxii] See note xxi.

[xxiii] See note xx.

[xxiv] U.S. Department of Labor. (4 September 2015.) The Cost of Doing Nothing: The Price We All Pay Without Paid Leave Policies to Support America’s 21st Century Working Families. Available at

[xxv] See note xx.

[xxvi] Noguchi, Yuki. (September 1 2015). “Boosting Family Leave Is Often About Getting Workers To Stay.” North Carolina Public Radio. Available at

[xxvii] Applebaum, Eileen, et al. (February 2014). Good For Business? Connecticut’s Paid Sick Leave Law. Center for Economic and Policy Research. Available at

[xxviiii] National Partnership for Women and Families. (April 2015). “Paid Sick Days: Low Cost, High Reward.” Available at

[xxix] See note xxviii. 

[xxx] Hall, Douglas and Gould, Elise. (March 31 2011). “Paid Sick Days: Measuring the small costs for Connecticut Businesses.” Economic Policy Institute. Available at

[xxxi] See note xxvii.

[xxxii] National Partnership for Women and Families. (March 2015). “Paid Leave Works in California, New Jersey, and Rhode Island.” Available at

[xxxiiii] U.S. Department of Labor. (September 29 2015). “Department awards $1.55M to study paid family, medical leave implementation.” Available at

[xxxiv] New Jersey Time to Care Coalition. (July 1 2014). “Families And Business Owners Celebrate Five Years With Successful Paid Family Leave Insurance Policy.” Available at

[xxxv] Economic Opportunity Institute. (July 15 2014). “Success in New Jersey! Paid Family Leave: Six Years Later.” Available at

[xxxvi] General Assembly of North Carolina Session 2015. House Bill 270: Healthy Families & Workplaces/Paid Sick Days. Available at

[xxxvii] General Assembly of North Carolina Session 2015. House Bill 269: Caregiver Relief Act. Available at

[xxxviii] Sirota, Alexandra; Mitchell, Tazra; Freyer, Allan. (2014). North Carolina’s Tomorrow: Seeking Good, Quality Jobs to Build an Economy that Works for All. Available at

[xxxix] U.S. Census Bureau. (September 2015). American Community Survey. Median Household Income by State. Available at