A Simple Way to Help Workers and Employers Hurt by Coronavirus

COMMENTARY Jobs and Labor

A Simple Way to Help Workers and Employers Hurt by Coronavirus

Mar 15th, 2020 3 min read
COMMENTARY BY
Rachel Greszler

Research Fellow in Economics, Budget and Entitlements

Rachel researches and analyzes taxes, Social Security, disability insurance, and pensions to promote economic growth.
A utility service worker deep cleans a bus at the King County Metro Atlantic/Central operating base on March 3, 2020 in Seattle, Washington. Karen Ducey / Stringer / Getty Images

Key Takeaways

For small businesses it can be difficult to pay workers while they are on leave.

The Working Families Flexibility Act could allow employers don't currently provide paid sick leave to do so.

It would also help working families accumulate paid leave to use at their choosing and based on their family's unique circumstances.

As concerns over the novel coronavirus mount, more workers need to stay home from work than usual. But for small businesses least able to handle disruptions in revenues, it can be difficult to pay those workers while they are on leave.

According to Republicans Sen. Mike Lee of Utah and Rep. Martha Roby of Alabama, there’s a logical solution. It’s one that he’s included in his Working Families Flexibility Act—one that’s both entirely optional and would cost nothing.

The overwhelming majority of workers (86% of full-time workers) have access to sick leave at work.

Those who don’t primarily work for smaller employers or in part-time and hourly positions. These are the employers and people policymakers should be looking to help as they seek to minimize the spread of the coronavirus.

Under current law, private sector hourly workers, as well as lower-wage workers (generally those with salaries under $35,568), are required to receive overtime pay at a rate of 1.5 times their hourly pay if they work more than 40 hours in any given week.

Unlike state and local government workers who, if they work four hours of overtime, can choose between six hours of pay or six hours of paid time off (“comp time”), private sector employers are prohibited from offering their workers this choice.

So how could this option help workers amid the COVID-19 disruptions?

As more people are staying home from work, remaining workers may be called upon to work overtime hours. In so doing, they could choose to accumulate paid time off to use in the future, at their choosing, including if they become sick or need to stay home for precautionary measures. If they later decide they don’t need the paid time off and would prefer pay, the act specifies that workers have the right to receive payment upon request instead.

This shift in the timing could simultaneously help employers, particularly smaller ones, who are struggling to manage their cash-flow amid coronavirus-related disruptions because they wouldn’t face the overtime costs in the immediate term.

It’s even possible that such a policy could allow employers who don’t currently provide paid sick leave to do so. It’s already in businesses interests to keep sick workers home, but sometimes costs can restrict their ability to pay workers. This option would make paid sick leave financially feasible for more workers and employers.

This step wouldn’t fix everything, but it is appropriately targeted and could provide significant relief to lower-wage workers who are less likely to have access to paid sick leave and to employers who are less likely to have sufficient cash cushions to make payroll and pay their bills if they suffer significant coronavirus-related disruptions.

The benefits of this policy go beyond just coronavirus, however. It would also help working families accumulate paid leave to use at their choosing and based on their own family’s unique circumstances and demands. After all, the most-cited factor families say would help them balance work and family is more flexible work schedules, which this provision would allow.

Lee’s and Roby’s legislation shouldn’t be controversial. It’s entirely optional—employers don’t have to offer it, and if they do, employees don’t have to choose it. And it wouldn’t cost taxpayers a dime.

As policymakers grasp for ways to help workers, businesses, and the economy weather the coronavirus, Lee’s and Roby’s solution should be a no-brainer.

This piece originally appeared in the Washington Examiner on 3/12/20