Despite Small Business Concerns, Vermont Could Soon Mandate Paid Sick Leave
A key vote in the Senate Tuesday has Vermont poised to become the fifth state in the country to require employers to provide paid sick leave. The compromise package is the result of years of advocacy by proponents of the measure. But some business groups are still wary of the plan.
Early Tuesday afternoon, shortly after the full Senate gave preliminary approval to a bill requiring paid sick leave, Gov. Peter Shumlin got a call from the senior advisor to President Barack Obama.
Valerie Jarrett wanted to congratulate Shumlin on passage of the legislation, and to thank Vermont for moving to institute at the state level a benefit that her boss has been unable to mandate nationwide.
“I think it’s a great bill, and I can’t believe there are too many Vermonters who think folks should go to work sick,” Shumlin said of the legislation Tuesday.
Shumlin perhaps is correct on that last count. But not everyone agrees that a legislative mandate is the best way to accomplish it.
The bill would require employers to provide at least three days of paid sick leave a year, beginning in 2018. In 2019, the number ratchets up to five days annually.
Analysts for the Legislature’s Joint Fiscal Office estimate the mandate will cost businesses as much as $11 million in added labor costs annually when fully instituted.
“What does that mean? Where does that come from? Does that mean that consumers pay higher prices? Does that mean some employment is cut back? Does that mean hours are reduced?” says Jim Harrison, executive director of the Vermont Retail and Grocers Association. “Those are all scenarios that have very real potential, and it disproportionately impacts the smallest businesses in the states.”
Rutland Sen. Kevin Mullin is the Republican chairman of the Senate Committee on Economic Development, which spent the first month of the 2016 session working on the bill. His committee worked from the version of the paid sick leave legislation that House passed last year.
"What does that mean? Where does that come from? Does that mean that consumers pay higher prices? Does that mean some employment is cut back? Does that mean hours are reduced?" — Jim Harrison, executive director of the Vermont Retail & Grocers Association
Mullin says the Senate version of the legislation includes several nods to employer concerns. It doesn’t apply to temporary or seasonal workers, for example, and employees who work less than 18 hours a week wouldn’t be eligible for the benefit.
Mullin says ensuring sick leave for some of the 60,000 Vermont workers who don’t currently receive it will have financial benefits for employers as well.
“Those benefits include reduced employee turnover, the cost of productivity losses as a result of payment to ill workers who underperform while on the job, reduced spread of contagious diseases, reduced emergency room use and other health-related benefits,” Mullin said.
During a 75-minute debate on the Senate floor, Windsor County Sen. Dick McCormack, a Democrat, says he’s fielded calls from concerned constituents.
“They’re saying, ‘if the state insists that this right be guaranteed, then the state should pay for it.’ And I would invite a response to that,” McCormack said.
"They're saying, 'if the state insists that this right be guaranteed, then the state should pay for it.' And I would invite a response to that." — Windsor County Sen. Dick McCormack
Washington Sen. Anthony Pollina, a Progressive/Democrat, said lawmakers are invoking the same worker-rights principles that gave rise to 40-hour work weeks and workplace safety laws.
“And I think that paid sick leave is just another step in that tradition, and I appreciate the work the committee has done to make it happen,” Pollina said.
Bennington Sen. Brian Campion said he was concerned that the legislation didn’t include special accommodations for small businesses, and questioned the appropriateness of treating local mom-and-pop companies the same way as multi-billion-dollar corporations.
Mullin said his committee considered a small-business carve-out, but ultimately decided against it.
“And that decision was based on testimony that a larger percentage of smaller firms did not provide paid time as compared with their counterparts in the larger-firm categories,” Mullin said.
Dan Barlow is public policy manager for Vermont Businesses for Social Responsibility, one of the few business groups that lobbied in favor of the bill. Barlow says an across-the-board mandate would ensure that employers who offer paid sick aren’t suffering a competitive disadvantage as a result.
“And for us, for VBSR members who mostly do offer this benefit already, they’re on an un-level playing field when competing with other businesses that don’t have this benefit,” Barlow says.
The Senate will hold a final vote on the bill Wednesday. The legislation then heads back to the House, which will have to sign off on the latest version of the bill before it heads to the governor’s desk.
This post was corrected at 3:16 p.m. on 2/3/16 to correct the district that Sen. Brian Campion represents