Opinion: For the sake of the wider economy, we need paid sick days

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Claude Lavoie was director-general of economic studies and policy analysis at the Department of Finance from 2008 to 2023. He has represented Canada at OECD meetings and has received many honours, including the Queen’s Diamond Jubilee Medal.

It’s flu season and too many workers in Canada will have to choose between their health and their capacity to pay for groceries and rent. You may be surprised that this is a choice many Canadians have to make – close to half of private-sector workers don’t have paid sick days.

Not surprisingly, this proportion is higher for low-income and vulnerable workers. In accommodation and food services, where workers are in frequent contact with people (and their lunches), about 80 per cent of workers don’t have access to paid sick days. Their inability to stay home when they’re unwell means we all get sicker. The few who do have access to paid sick days get very few of them, often insufficient for their needs, and certainly below the 10-plus days offered in most OECD countries.

This needs to change.

There is a wealth of evidence that paid sick days likely advance business interests by reducing illness transmission at work, while reducing long-term costs for the health care system. Paid time off for sick workers benefits the wider economy.

Yet Canada is one of the only three advanced countries with no national mandatory paid time off. Late in 2022 the federal government introduced a law granting 10 paid sick days to all employees in federally regulated private sectors (e.g., airports, banks), but this covers only about 5 per cent of all workers. Most private-sector workers (95 per cent) are in provincially regulated sectors, and very few provinces mandate paid sick days. The three provinces that do are less generous than Ottawa and the allowance can’t cover the time off needed to get over a typical flu. British Columbia grants five days, Quebec two and PEI only one. Workers are thus left to the “goodwill” of employers for access to paid sick leaves.

This spring the Ontario Liberals introduced, for the third time, a bill that would give workers a minimum of 10 paid sick days. It’s likely this bill will be defeated by the Conservative-led government (like the two previous attempts), though it’s hard to understand how a political party claiming to defend common sense could be opposed. If workers can afford to stay home when they are sick, it reduces the spread of contagious illnesses and improves overall public health, thus lowering the strain on hospitals and other government-funded health care services.

But the benefits don’t just stop there. Studies show that employees with paid sick leave suffer from fewer workplace injuries and have better long-term health owing to increased use of preventive care. Taking time off while ill improves mental health and reduces stress by allowing employees to take care of their health – or their family’s health – without fear of income loss.

Paid sick leave also supports efforts to improve gender equality. It helps retain women in the work force because they tend to be the ones staying home when a member of the family is unwell.

Moreover, research finds that paid time off for sick workers has minimal, if any, negative impact on employment and wages. The costs for employers tend to be small. Follow-up surveys in regions where paid time off was introduced show that employers, including most small businesses, were not significantly affected.

Paid sick days may even make firms more productive: employees recover faster because they have adequate rest. There is also very little evidence suggesting that employees are shirking or abusing their leave entitlements. Studies show that employees rarely use all their paid sick days.

These are well-worn arguments for mandating paid time off for sick workers that we’ve heard for many years, from many corners of society: health experts, international organizations, policy think tanks, labour movements.

So why the opposition from the business lobby, which makes the argument that it increases costs, hurts competitiveness, and costs jobs?

Could the opposition be based on false premises, or perceived threats to the corporate bottom line?

It’s important to remember that the Canadian Federation of Independent Businesses naively predicted that enhancements to the CPP, in which obligations on the part of employers increased, would be a job-killer. Yet contrary to their fearmongering, the impact has been barely noticeable and the labour market has not suffered.

Leaving the fate of paid sick time off at its current status quo is not the answer. Governments should put the wider economy ahead of ill-informed business lobby demands. It’s just common sense.