Federal Contractors' Employees to Get Paid Sick Leave

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By Gayle Cinquegrani

Sept. 8 — President Barack Obama's Sept. 7 executive order that would require federal contractors to provide their employees up to seven days of paid sick leave per year is drawing strong reaction, with Republicans and industry groups describing it as a drain on the economy, and Democrats and worker advocacy groups commending it as a welcome and necessary benefit.

Workers on federal contracts will earn at least one hour of paid sick leave for every 30 hours they work under the order, which the president signed on Labor Day. They will be allowed to use this leave to care for themselves or a family member, and for absences resulting from domestic violence or sexual assault.

The requirement will apply to new federal contracts beginning in 2017. The White House estimates 300,000 workers will begin receiving paid sick leave because of the order.

It likely will take a year for the Labor Department to complete rulemaking to implement the executive order, White House Press Secretary Josh Earnest said during a Sept. 8 press briefing. The order directs the DOL to issue regulations by Sept. 30, 2016.

Earnest said he would “not rule out” the possibility the president will take additional executive actions to help working families.

“Right now, about 40 percent of private-sector workers—44 million people in America—don’t have access to paid sick leave,” Obama said while commemorating Labor Day in a speech before the Greater Boston Labor Council Sept. 7. “You’ve got parents who have to choose between losing income or staying home with their sick child. You have victims of domestic violence or sexual assault who can’t seek medical attention or counseling because they might have their pay docked,” he said.

“Let’s face it—nobody wants a waiter who feels like they have to come to work when they’re coughing or contagious,” Obama said. “But if they don’t have sick leave, what are they going to do?”

Obama Says He Will Do What He Can

“Only Congress has the power to give this security to all Americans. But where I can act, I will,” Obama said, explaining he will use the federal contracting process to extend a paid sick leave benefit to workers on federal contracts.

“This executive order is attempting to ensure the federal government leads by example,” Labor Secretary Thomas Perez said Sept. 6 in a telephone call announcing the order to reporters. “The U.S. is the only country where a federal paid leave law has become a partisan issue,” he said.

Administration officials did not provide an estimated cost to contractors of implementing the paid sick leave measure, but they asserted the cost would be offset by decreased staff turnover and increased worker productivity.

The administration already requires federal contractors to pay their employees a minimum wage that exceeds the federal minimum wage of $7.25 per hour. Under an executive order Obama signed in February 2014, workers on federal contracts entered into or renegotiated starting in 2015—including construction and fast food concessions workers—must be paid at least $10.10 per hour.

Republicans Critical

Republican lawmakers were quick to criticize the paid sick leave order.

“This announcement reflects another missed opportunity to advance real reforms for working families, and it will make it even harder for small businesses to do business with the federal government,” Rep. John Kline (R-Minn.), chairman of the House Education and the Workforce Committee, and Rep. Tim Walberg (R-Mich.), chairman of the House Workforce Protections Subcommittee, said in a joint statement Sept. 7.

Kline and Walberg said legislative leave proposals supported by Republicans “would empower workers with the ability to accrue paid time off to use as they see fit, whether it’s recovering from an illness, caring for an aging relative, or simply attending a child’s sporting event. We can provide working families more flexibility without more government mandates and executive orders.”

Some industry groups also criticized the president's use of the federal procurement process as a vehicle to effect social policy objectives.

Text of the executive order is available at http://op.bna.com/dlrcases.nsf/r?Open=gcii-a26l4c.