Early effects of the San Francisco paid sick leave policy

Abstract

Objectives: We examined employers' responses to San Francisco, California's 2007 Paid Sick Leave Ordinance.

Methods: We used the 2009 Bay Area Employer Health Benefits Survey to describe sick leave policy changes and the policy's effects on firm (n = 699) operations.

Results: The proportion of firms offering paid sick leave in San Francisco grew from 73% in 2006 to 91% in 2009, with large firms (99%) more likely to offer sick leave than are small firms (86%) in 2009. Most firms (57%) did not make any changes to their sick leave policy, although 17% made a major change to sick leave policy to comply with the law. Firms beginning to offer sick leave reported reductions in other benefits (39%), worse profitability (32%), and increases in prices (18%) but better employee morale (17%) and high support for the policy (71%). Many employers (58%) reported some difficulty understanding legal requirements, complying administratively, or reassigning work responsibilities.

Conclusions: There was a substantial increase in paid sick leave coverage after the mandate. Employers reported some difficulties in complying with the law but supported the policy overall.

FIGURE 1—

San Francisco sick leave offering by (a) firm size in 2006 and 2009 and (b) type of leave offered in 2009: Bay Area Employer Health Benefits Survey, California. Note. PTO = paid time off. Offering sick leave includes separate vacation and sick leave, sick leave only, and paid time off that can be used for vacation or sick leave. We used employer weights on the basis of firm size at site, profit status, location, and industry to make the sample representative of the population of San Francisco firms.