By Eva Matischak
The NYC Council is proposing yet another mandate to add onto the backs of our city’s small businesses, which are struggling to stay afloat. With NYC already having some of the highest costs of doing business in the country, they want to force small businesses to provide five paid sick days and “large” businesses with 20 or more employees to provide nine paid sick days!
We applaud Council Speaker Christine Quinn for recognizing the detrimental impact the paid sick leave measure will have, and support her continued leadership in not allowing the bill out of the committee. Rather than stoking fears of getting the flu with your cup of soda (like a few of the council members have been discussing in the past several weeks), let’s first identify the problem.
How many people are actually getting fired when calling in sick? No one is asking the business owners why they fired the person—perhaps the employee had other personnel issues. After all, what business owner wants to get rid of a good employee?
How many people are not formally getting paid sick days? Most employers already offer this. Perhaps there are “unwritten” agreements between employers and employees where they work out sick and vacation days without being in writing. Or perhaps, in the case of one small business owner, she gives her employees three days, as that is all she can afford.
There are widely fluctuating numbers tossed around by the proponents from studies all over the place. Why doesn’t the City or State first truly study the scope of the issue to determine if there is a problem before creating mandates based on insignificant polling numbers and studies?
And how does this incentivize small businesses to hire? There are three tiers based on the number of employees: five or fewer, six to nineteen, or more than twenty. Why should company size affect the number of sick days? Why grant five or nine paid sick-leave days, when the national average for sick days taken by workers with paid sick leave is four days, and without leave, the average is three days? Am I going to get sick more because I work for a larger company? This makes no sense at all.
There are bills in Connecticut, Washington, D.C., and San Francisco and again, the proponents are saying that there has been no ill effect. But in Connecticut, businesses with fewer than 50 employees are exempt. In Washington, seven categories of workers are exempt, and they even provide for a financial hardship exemption. And San Francisco does appear to have been negatively affected.
The Bureau of Labor Statistics reports that for 2006-2010, quick service restaurants in San Francisco saw a decline of employment by 7.8 percent, whereas those in the surrounding counties without paid sick leave saw employment increase by 2.5 percent. Also, other private sector employment not affected by paid sick leave added 2,300 jobs, while quick-serve restaurants in San Francisco lost 1,300 jobs.
The supposed new bill amendments being discussed for NYC include a one year grace period for new companies and five unpaid sick days for businesses with fewer than five employees. But these points are not consistent with what the proponents are saying. What they are saying is that the economic impact has been minimal. But if that is the case and they think it will be minimal in NYC, then why should new companies or small businesses be exempt at all? If it is not going to hurt them, then why exempt them? Again, this makes no sense.
And the entire cost of the bill would be borne by the employer, who will be forced to freeze hiring at a time of 10 percent unemployment, cut benefits, cut jobs, raise prices on goods, or finally pack up and leave. Existing businesses struggling to survive cannot handle the additional burden of paying nine paid sick days for an employee, paying the overtime to the employee’s replacement, and paying added payroll tax costs.
And take a look at the empty storefronts along First, Second and Third avenues on the Upper East Side. Do you think those small businesses that are keeping their doors open don’t worry every day that with the high cost of doing business in our city, they will also have to close their doors? Can the businesses in the Second Avenue subway construction zone like us shoulder any more financial burdens? My business and many others in my neighborhood are already struggling with the construction issues and lack of customers.
We all support the intentions behind this idea, but as noted, it does not make good business sense for employers or employees. The speaker should continue to oppose this onerous bill.
Eva Matischak is the owner of Heidelberg Restaurant.
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