How should your small business deal with paid sick days?

Local, state, and the federal government have been considering or even taking the step of requiring businesses to provide paid sick days to their employees. There are obvious benefits to giving employees paid sick days — if employees are indeed sick, they are not working at their normal productivity, and are likely to get other employees sick and reduce their productivity, which for a small business can significantly reduce the whole company’s productivity. However, paid sick days are a benefit that small businesses often can’t afford.

But in the face of potential governmental regulations requiring at least some small businesses to provide paid sick days to their employees, there are some steps startup owners can take to get out in front of possible regulations:

1) Telecommuting and work from home options. If the type of business and the employee’s position allows for it, a startup may consider allowing employees to telecommute or work from home. Telecommuting options give employees the opportunity to contribute their productivity to the company while allowing them to deal with personal, family, and home issues, such as dealing with a personal illness, the illness of a family member, being available for home delivery or repair services, and avoid the time, expense, and risk of traveling to work in inclement weather.

2) Combining paid vacation and sick days. If a startup already provides paid vacation days, it may wish to consider reclassifying the benefit as “personal time off”, or PTO, which employees can utilize for any purpose, including vacations, illnesses, or handling personal issues at home.

3) Unlimited PTO. Some startups have even begun providing their employees with unlimited paid vacation days or PTO. The main advantage to unlimited time is eliminating the need (and the corresponding overhead) to keep track of employees’ paid time off (or depending on applicable laws and regulations, compensate employees for unused time in certain circumstances). Having no fixed amount of time also removes the need for employees to “use it or lose it” in regards to paid time off — it is likely that employees will use even less time. And although having an unlimited time off benefit allows for the possibility of abuse, employees who would abuse that privilege are not employees that a startup would want to keep around anyway. However, guidelines for using the unlimited PTO, and standards for abuse of the privilege, should be made clear to employees up front in an offer letter or employee handbook.