Small Businesses Cannot Afford State-Mandated Paid Sick Leave, NJBIA Says

A paid sick leave mandate would hurt small businesses, penalize companies that already provide paid time off and not accomplish what supporters say it will, according to the New Jersey Business & Industry Association (NJBIA).

NJBIA Assistant Vice President Stefanie Riehl, who is scheduled to testify at the Thursday committee hearing, said a better approach would be making it easier and more affordable for businesses to provide paid leave voluntarily.

“No business wants to lose good workers,” Riehl said, “so when companies can afford to provide paid sick leave, they do. For those that do not, it’s most likely because they cannot afford it. Hitting these companies with a paid sick leave mandate will make it harder for them to stay in business and ultimately cost the state more in lost jobs and closed businesses.”

Riehl noted that businesses have a set amount of resources. If the state forces them to devote those resources to paying people who are not at work, they may have to make it up by cutting somewhere else. This is particularly hard for small, locally owned businesses like corner stores, dry cleaners and barbershops.

“These ‘mom-and-pop’ operations do not have much flexibility with staffing,” Riehl said. “When an employee calls out, they are already in a bind. This bill would just add to that burden, as they would have to pay double wages – one for the absent worker and wages for their replacement.”

Additionally, a paid sick leave mandate would punish businesses that already provide paid sick leave to their employees.

“Businesses have always been able to tailor their benefits and to customize their policies to meet individual worker needs,” Riehl said. “Paid sick leave mandates put businesses in a box by forcing them to use a one-size-fits-all program, even those with generous existing policies.”

Among the sick leave policies that could be eliminated under the legislation is a “well day” program where workers receive extra pay for every month an employee is not out sick, does not come in late, or does not leave early. Similarly, some companies have policies that pay employees for days they remain home for illnesses for themselves, close family members or another valid excuse. There is no set limit, as long as it is not abused.

Contact: Peter Peretzman, 609-858-9502