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Paid Leave as a Benefit May Increase Productivity: What an Employer Should Know

There is sometimes a perception abroad that Americans do not take sufficient time off of work, and that we are more focused on the “almighty dollar” than on enjoying the life, liberty, and pursuit of happiness granted to us by our founding documents. Given some countries’ liberal leave policies, it is not a mystery as to why they feel this way. However, foreign employers do not face the same pressures as American employers, whether from competition or the ever-changing regulatory scheme. Paid leave policies are offered by many companies as an incentive to attract and keep highly skilled employees who otherwise might seek employment with a competitor. What these employers may not realize is that, according to one government research study, when employees are happy (read: can take some paid time off), they may work more efficiently and be more productive in the workplace.

Leave and Mental Health

The benefits of having a discernible “work-life balance” have been written about in numerous studies and discussed in the media at great length. The days of Dickens’ Ebenezer Scrooge management style are (hopefully) over as the strict “work over all” demands fell quickly out of favor after employees began suffering from increased illnesses and injuries due to workplace stressors. It is well known that the ability to take a reasonable amount of time off of work, without worrying about the ramifications to their paycheck can help boost morale, and increase the overall health of workers. The question then becomes, what are the downsides to a company that wishes to offer paid time off? 

Cost-Benefit Analysis

As with anything, employers should weigh the potential costs of any leave policy that they wish to implement against the benefits that they should expect to reap. One piece of information that should allow employers to breathe a sigh of relief is that according to a survey of 253 employers across the country that implemented paid leave policies, 90% reported either positive effects or no negative effects following implementation. While this study does not forego an employer’s need to conduct its own needs assessment, it should provide incentive for leave policies to be discussed if they are not already in place. 

One of the largest costs to an employer can be workers’ compensation coverage and payouts when an employee is injured while working. Studies have provided support for the idea that a healthy workforce is a productive one, and that being able to take a day off when they are sick can help prevent accidents in the workplace. During times of epidemics, employers should definitely consider encouraging sick employees to stay home and recover rather than come into the workplace and endanger the health of other employees. According to the Centers for Disease Control, American employers spend up to $10.4 billion annually in healthcare costs due to instances of the flu among their employees. Broken down, this amounts to $135 per day per employee that must seek medical treatment for an illness.

Policy Questions?

If your company is seeking to create a paid leave policy, or modify an existing one, and need advice on how to proceed, call the law office of Garcia & Gurney today. Our attorneys are experienced in all aspects of employment law, and can guide your company in the right direction.  Building a strong company starts with strong employment policies and a strong workforce. We can help you create those policies and protect your biggest investment on the road ahead.

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