Mandated Sick Pay: Coverage, Utilization, and Welfare Effects

Arbeitspapier

This paper evaluates the labor market effects of sick pay mandates in the United States. Using the National Compensation Survey and difference-in-differences models, we estimate their impact on coverage rates, sick leave use, labor costs, and non-mandated fringe benefits. Sick pay mandates increase coverage significantly by 13 percentage points from a baseline level of 66%. Newly covered employees take two additional sick days per year. We find little evidence that mandating sick pay crowds-out other non-mandated fringe benefits. We then develop a model of optimal sick pay provision along with a welfare analysis. For a range of plausible parameter values, mandating sick pay increases welfare.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: IZA Discussion Papers ; No. 13132

Classification and Topics

• Classification: Wirtschaft ; Health Behavior ; Health Insurance, Public and Private ; Health: Government Policy; Regulation; Public Health ; Time Allocation and Labor Supply ; Safety; Job Satisfaction; Related Public Policy ; Nonwage Labor Costs and Benefits; Retirement Plans; Private Pensions
• Subject: sick pay mandates ; sick leave ; medical leave ; employer mandates ; fringe benefits ; moral hazard ; unintended consequences ; labor costs ; National Compensation Survey (NCS) ; welfare effects ; optimal social insurance ; Baily-Chetty

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Maclean, J. Catherine ; Pichler, Stefan ; Ziebarth, Nicolas R.
• Event: Veröffentlichung
• (who): Institute of Labor Economics (IZA)
• (where): Bonn
• (when): 2020

Further information

• Handle: http://hdl.handle.net/10419/216444
• Last update: 10.03.2025, 11:44 AM CET