Federally Mandated Paid-Leave: Bad for Employers and Workers

Politicians in both the Democrat and Republican parties have indicated support for federally mandated paid-leave. While on the surface this may sound like a good thing for employees who want more paid time off (PTO), but the reality is far more complex.

By mandating a one size fits all approach to PTO, the federal government undermines the employer and employee relationship. Businesses know their employees better than the government does and possess the ability to tailor compensation to fit the needs of each individual employee. According to the National Federation of Independent Businesses (NFIB), 56% of small businesses already offer paid sick leave, 77% offer paid vacation time, 49% offer paid holidays and 73% offer paid time off that can be used for any type of leave.

In addition to weakening compensation flexibility, mandatory paid-leave would have the unintended consequences of reducing economic output, increasing paperwork and record-keeping costs, and eliminate thousands of jobs. Daniel Bosch, senior manager of regulatory policy at NFIB stated: “Forcing small businesses to pay for unproductive time means they have fewer resources available to try to grow the business, or worse, could mean having to eliminate some positions to remain financially viable.”

Congress should make it easier for businesses to grow, hire more workers, and freely compensate their employees, not pass laws that increase labor and employment costs. Forcing mandatory paid-leave across the country will end up hurting both workers and businesses.

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