Proposed Paid Sick Leave Expansion Adds New Burden for Struggling Small Businesses
A proposed expansion of Connecticut’s paid sick leave mandate will further burden struggling small businesses, employers and business groups warned today.
Lawmakers are considering two bills that overhaul current state law, which the legislature narrowly passed in 2011—also in the aftermath of a recession.
The General Assembly’s Labor and Public Employees Committee will hold a public hearing at 10 am today on SB 1178 and HB 6668, both of which expand the paid sick leave mandate to all private sector employers.
“Connecticut’s already the sixth costliest state to run a business according to CNBC’s 2022 America’s Top States for Business study,” said Eric Gjede, CBIA vice president for public policy.
“These proposals will only drive up those costs, particularly for small businesses, many of which have yet to emerge from the pandemic recession.”
Additional Costs
Connecticut employers with 50 or more employees currently must provide paid sick leave to each of their in-state, full, or part-time service workers.
Gjede noted that after the law took effect in 2012, a study showed that 90% of Connecticut businesses already offered some type of paid leave for employees.
Despite that, 53% of employers incurred additional cost increases ranging from 2% to 5% to comply with the mandate’s various accrual and usage requirements.
HB 6668 mandates that employers with 11 or more employees provide up to 40 hours of annual paid sick leave.
Those with 10 or fewer employees must provide up to 40 hours of unpaid leave each year.
SB 1178 mandates paid sick leave for all private sector workers and requires all employers to double the annual leave allotment from 40 hours to 80 hours.
‘Creates Havoc’
Stephen Perez, vice president of Wethersfield-based Wingsite Displays, said expanding the leave mandate to 80 hours annually “will create havoc in the small business community.”
“We were small to begin with—23 employees and one part-time,” Perez said. “Post-COVID, we are at 16 employees, with one part-time employee.
“We have and continue to provide 24 hours of sick leave and 24 hours of personal time to our employees.
“We did this not because it’s mandated, but because we felt it was the right thing to do.”
Lynn Ward, president and CEO of the Waterbury Regional Chamber, said the proposals “were attempting to fix a problem the legislature solved back in 2012.”
“Connecticut workers currently have the option to use one of the country’s most benevolent paid family and medical leave programs available,” she said. “At some point, elected officials in Hartford must keep the employer in mind while considering employees.
“Adding more mandates on top of existing burdens will be detrimental to their livelihoods, especially during this fragile economic recovery period.
“While well-intentioned, feedback from our small business owners who are already struggling to survive proved that the cost of doing business here in Connecticut is pushing them to a tipping point.”
‘Troubling Pattern’
The paid sick leave mandate is separate from Connecticut’s paid family and medical leave law, which the legislature narrowly approved in 2019.
That mandate applies to private sector employers with as few as one worker, allowing up to 12 weeks of paid leave for employees to care for themselves or an extended family member—the richest benefits in the nation.
Gjede said the latest proposals continue “a troubling pattern of treatment of Connecticut’s small businesses by policymakers.”
“Small businesses continue to be disadvantaged by the state’s tax policies and bear a disproportionate burden of what seems to be a never-ending series of workplace mandates,” he said.
“Now is the time when lawmakers should be helping small businesses, which represent the largest percentage of employers in the state, rather than adding to their current challenges.”
CBIA is Connecticut’s largest business organization, with thousands of member companies, small and large, representing a diverse range of industries from every part of the state. For more information, please contact Scott Beaulieu (860.244.1929).
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It never seems to end in CT. As if the ever-shrinking workforce and high tax situation was not bad enough. I truly do not believe CT lawmakers care about the small business owners and keep pushing us to the brink. I think these laws are geared for votes and the long-term consequences are being ignored for short term political gains.
” when the employee works they get paid”
” if the employee doesn’t work they dont get paid”
What has happened to this thought process?
Totally agree with the comments from Anthony & Bill! Small businesses cannot take on any more burdens. Then these Employees will have no job.
We are a small contracting business with 20 Employees. We are unable to find additional help so we are declining bid opportunities because of the labor shortage. We already pay two to three weeks vacation and 8 paid holidays. At a time when profits are down it is not a time to add costs. If 20 employees each used a week of paid leave we would have to take on less work and at the same time increased costs. It is not just the cost of paid time off but the added cost of lost income.
This state will eventually force a lot of businesses to close. With our business, after 4o years; moving is not an option, closing the doors is the only option.
Maybe we need to add a requirement for state legislatures who propose increasing small business costs to first try running a small business. Maybe then they could tell the difference between what is reasonable vs. what is excessive and harms our states competitiveness.