In our last post we discussed vacation policies, from both the best-practices and legal standpoints. In today’s post we take a quick look at Sick Pay.
What is required by law?
Like vacation, sick pay is not required under Federal or State statutes. However, there are a number of localities passing measures requiring employers to provide sick pay to their employees. If sick leave is offered, up to 50% of the time must be permitted to care for immediate family members (“Kin Care”).
Unlike vacation, sick pay does not need to accrue or vest, and employers are not required to payout sick leave at termination. This flexibility allows them a certain level of creativity when it comes to implementing a sick pay policy.
“Use it or Lose it” Policies
Employers MAY implement a “use it or lose” policy, but need to be aware that such policies may lead to sick leave abuse. Statistics vary as to the percentage of employees who abuse sick leave, with estimates ranging from 15% to 30%. [1]
Instead of “use it or lose it” sick pay, it is recommended to roll the accrued time over to the next year, with a cap. This policy eliminates the need for an employee to call in sick, lest they lose a benefit they view as “coming to them”.
The most common sick day policies grant between 5 and 10 sick days off per year.
If you need assistance reviewing your sick, vacation, or other PTO policies, please give us a call – one of our Human Resources Consulting experts will be sure to help.
Source: [1] USB Leaders Lab, “A Cure For Sick Leave Abuse:”, August 2008.