Policy Matters is a series from the Regional & Community Outreach research team at the Boston Fed, using data to illustrate the real or potential implications of policy for promoting equitable outcomes and economic security in New England and across the United States.

Sara Chaganti is deputy director of research for Regional & Community Outreach at the Federal Reserve Bank of Boston.

This edition of Invested: Policy Matters considers how much the Families First Coronavirus Relief Act could equalize access to paid sick leave in the Northeast region.

The coronavirus pandemic has highlighted both the importance of paid sick leave—for promoting public health and maintaining a healthy economy—and the startling absence of any federal paid sick leave policy. Before 2020, private sector employers were not federally required to provide their employees with paid sick leave.¹ Since the start of the pandemic, we have seen clearly why paid sick leave is essential to protect public health. But it's also important in ordinary circumstances. Without it, workers may be forced to go to work while sick, and even while contagious, so they don't lose vital paid hours or lose a job completely, risking personal and family financial peril. Even without a federal paid sick leave law in place before the pandemic, I should note that several states and some cities had already passed laws requiring private sector employers to give workers paid sick leave, usually allowing workers to take about a week of paid time off each year.² Massachusetts passed the first universal state paid sick leave law in the Northeast region³ in 2015.⁴ But without a federal paid sick leave requirement, geographic gaps in leave coverage remained. The first pandemic relief package, known as the Families First Coronavirus Response Act (FFCRA),⁵ passed in March 2020 and required firms with 500 or fewer employees to provide paid sick leave for COVID-related reasons to all employees. I wondered how much paid sick leave coverage might have increased in 2020 because of FFCRA, and if FFCRA might have increased equity in access to paid sick leave by requiring broad-based coverage.

In order to consider how the FFCRA might change rates of access to paid sick leave in the absence of state paid sick leave policies, I looked at the existing paid sick leave availability in New England in the five years (2010 to 2014) before Massachusetts’ paid sick leave law was in place. I used publicly available data from the National Health Interview Survey,⁶ a survey on health, healthcare, and related issues that the CDC administers yearly. This survey asks all respondents who have some work history if they had paid sick leave in their main job, in the job they held the longest, or in the job they held most recently. I saw that in the Northeast, nearly six out of every ten adults with some work history had paid sick leave, but certain subgroups of workers had access to this benefit at much lower rates. For example, only one in four workers from low-income families (those with household incomes below the federal poverty line) had paid sick leave included in their job benefits. Hispanic workers also saw lower rates of access to this benefit: just five of 10 Hispanic workers’ job benefits included paid sick leave, compared to six of 10 among all workers.

Overall, FFCRA could have led to close to 95% of workers in the northeast being covered (we don’t yet have the data to confirm this number). And rates for the sub-groups of workers, which had varied widely with no legislation in place, would have become fairly similar with FFCRA enacted. FFCRA evened out the distribution of paid sick leave benefits, so that workers who were much less likely to have it before ended up having it at the same rate as everyone else. It's therefore an example of how thoughtful and well-implemented universal policies can play an important role in creating equity within the labor market. 

For a deeper dive into the potential role of policy in increasing and equalizing access to paid sick leave, see this new Issue Brief by the same author.

1. Prior to the pandemic, thirteen states and several localities had paid sick leave laws in place. One state passed a paid sick leave law during the pandemic.
2. National Conference of State Legislatures. (2020, July 21). Paid sick leave. https://www.ncsl.org/research/labor-and-employment/paid-sick-leave.aspx
3. Prior work on the disparate effects of the pandemic focus on New England, the first region of the Federal Reserve System. In this report, data limitations preclude limiting the analysis to the New England states. The smallest geographic region available for analysis is the census region: Northeast, South, Midwest, and West. This analysis, therefore, reflects the population of the Northeast region.
4. The text of Massachusetts’ law can be viewed at 191st General Court of the Commonwealth of Massachusetts, https://malegislature.gov/Laws/GeneralLaws/PartI/TitleXXI/Chapter149/Section148C; for additional information, see Massachusetts Attorney General’s Office. (2018). Earned sick time in Massachusetts: Frequently asked questions. https://www.mass.gov/files/documents/2018/09/21/est_faq_1.pdf. Connecticut passed a paid sick leave law for service workers only, in 2011 (in effect starting in 2012). This law only applied to service workers, with covered occupations specified in the legislation. Given the limited scope of this legislation, this brief uses data from the period leading up to 2015, when Massachusetts legislated statewide paid sick leave for all workers. The text of Connecticut’s law can be viewed at Connecticut Department of Labor, https://www.ctdol.state.ct.us/wgwkstnd/SickLeave.htm.
5. Families First Coronavirus Relief Act, 116-127 (2020). https://www.congress.gov/bill/116th-congress/house-bill/6201/text
6. NHIS data are available for public use through IPUMS. The NHIS provides population weights for analysis of both the full survey and the subsamples. Statistics in this report are weighted accordingly. Blewett, L. A., Rivera Drew, J. A., King, M. L., & Williams, K. C. W. (2019). IPUMS health surveys: National Health Interview Survey, Version 6.4 [dataset]. Minneapolis, MN: IPUMS. https://doi.org/10.18128/D070.V6.4

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