City of Austin Mandated Paid Sick Leave Ordinance

The City of Austin has proposed a policy that requires all businesses to provide paid sick leave to employees. The draft ordinance is now available and is scheduled for City Council action in mid February. Read the ordinance here.  AIBA polled our members to determine our position by asking for a support or oppose vote on the draft ordinance. If the respondent was against the ordinance, we asked what changes would make the ordinance acceptable. In addition, we asked for verification of business name to assure that the answers were being provided by existing businesses. The poll was conducted January 25 and 26. Read the results and comments here.
AIBA is a nonprofit organization of local businesses. Most of our members are small businesses who understand that taking care of their employees is both a philosophical value and a necessity. They cannot succeed without a dedicated, reliable and happy workforce. Turnover in any business is costly. We do not view the world as workers against business or business against workers. As small local businesses, we are the workers. We see all of us in this together. Businesses provide jobs and workers help local businesses to grow. We are a team. The health and well being of the team is important. But the team is the best source for business benefits, not local government.
88% of respondents opposed the ordinance. The vast majority who opposed had no changes that would make the ordinance acceptable. As the voice of local business, we will follow our members’ lead and oppose this ordinance.
• This is a serious overreach of local government. The study supporting this was a national study conducted several years ago. There is no indication that the study eliminated independent contractors. Following a national trend, Austin has a large and growing number of independent contractors. Paid sick days cannot apply to independent contractors as it jeopardizes their standing as independents.
• The study conducted by Public Policy Polling for Work Strong Austin interviewed 600 Austin voters. 49% of those interviewed aren’t even subject to paid or unpaid sick days because they don’t work. According to the study, 29% are retired, 13% are self employed and 7% are students and homemakers. Of course they have an opinion. But should our City Council make decisions based on the opinion of those unaffected by that policy? We think not.
•  Let’s assume there is a problem with some in our community not being able to afford to take a day off when they are sick. These are primarily construction, maintenance and lower-wage hourly workers. If this is a problem, let’s find a way to fix the problem. Mandating a citywide policy has the potential to degrade or destroy the systems already in place by the majority of employers doing the right thing. Doing the right thing for employees and employer is a benefits policy that works to the benefit of both. Many AIBA members voiced that they have a system in place that provides the benefits their employees wanted which may or may not include specified sick leave. A broad policy like this destroys the ability for Austin’s entrepreneurs to be flexible and accommodating.
• Since this cannot by law apply to independent contractors, are we opening up a loophole that will encourage unscrupulous employers to reclassify employees as independent contractors to avoid compliance? The unintended consequences could be the loss of benefits enjoyed now by their employee status.
• Small employers will be hit hardest by this policy. Many struggle with rising property taxes and unaffordable leases. A small employer must juggle all aspects of their business just to survive. Most have told us in our surveys that they would be laying people off or cutting back hours to pay for an extensive sick leave policy. How will this help the most vulnerable business and employees when they no longer have a job?
• The unemployment rate in Austin is so low that employers are having to compete to attract qualified employees. This policy will tie their hands in bringing innovation to that competition. Let the marketplace drive better benefits. As an employee, if you’re not satisfied with your current benefits, another job is not hard to find. Look at local businesses…they’re looking for you.
• Many employers utilize Personal Time Off. It’s flexible, it’s measurable and it’s honest. By mandating paid sick time, our local government is encouraging a deceptive relationship between employer and employee. Have sick days but haven’t used them? Why let your coworkers get time off that you don’t get? Just call in sick. It’s dishonest and a system that encourages this shouldn’t be forced on businesses who are building honest relationships with employees.
No  one wants to go to work sick. No one wants sick employees sharing their illness in the workplace. But this heavy-handed ordinance is not the answer. AIBA opposes this ordinance, as currently written, on behalf of local business.