Sick Pay Reforms and Health Status in a Unionised Labour Market

Arbeitspapier

We theoretically analyse the effects of sick pay and employees’ health on collective bargaining, assuming that individuals determine absence optimally. If sick pay is set by the government and not paid for by firms, it induces the trade union to lower wages. This mitigates the positive impact on absence. Moreover, a union may oppose higher sick pay if it reduces labour supply sufficiently. Better employee health tends to foster wage demands. If the union determines both wages and sick pay, we identify situations in which it will substitute wages for sick pay because adverse absence effects can be mitigated.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: CESifo Working Paper ; No. 6177

Classification and Topics

• Classification: Wirtschaft ; Externalities ; Health Insurance, Public and Private ; Health: Government Policy; Regulation; Public Health ; Time Allocation and Labor Supply ; Trade Unions: Objectives, Structure, and Effects ; Dispute Resolution: Strikes, Arbitration, and Mediation; Collective Bargaining
• Subject: absence ; employment ; sick pay ; trade union ; wage determination

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Goerke, Laszlo
• Event: Veröffentlichung
• (who): Center for Economic Studies and ifo Institute (CESifo)
• (where): Munich
• (when): 2016

Further information

• Handle: http://hdl.handle.net/10419/149264
• Last update: 10.03.2025, 11:42 AM CET