Mandatory Paid Sick Leave Ordinances Will Have Detrimental Effect on Unemployment and the Economy

[Elderberry]

Texas Public Policy Foundation 8/28/2019

New Report Finds City Mandatory Paid Sick Leave Ordinances Will Have Detrimental Effect on Unemployment and the Local Economy

https://www.texaspolicy.com/press/new-report-finds-city-mandatory-paid-sick-leave-ordinances-will-have-detrimental-effect-on-unemployment-and-the-local-economy

A first-of-its kind report on mandatory paid sick leave policies finds that the ordinances have serious negative economic effects on employees, businesses, and the local economy. The report was included in an amicus brief filed by a coalition of San Antonio businesses in support of the Texas Public Policy Foundation’s lawsuit against the City of Dallas’ mandatory paid sick leave ordinance.

The amicus brief reiterates the Foundation’s arguments that paid sick leave ordinances are unconstitutional, that there is no empirical evidence suggesting mandatory paid sick leave is related to the municipality’s interest in promoting the health, safety, and welfare of its residents, and that the ordinance will have a detrimental (not positive) effect on unemployment and the local economy.

The report, A Review of Economic Effects of Paid Sick Leave Legislation, was prepared by Dr. David Macpherson, the chair of the economics department at Trinity University.

Dr. Macpherson’s report finds that “based on research regarding the effects of increases in the minimum wage, we know that the common areas of economic responses to a wage increase such as a mandated employer-paid sick leave are likely to have a negative impact on the employer-employee relationship, the employer’s products and services, and the local economy.”

The Review of Economic Effects of Paid Sick Leave Legislation is the first and only substantive examination of the effect of mandatory paid sick leave ordinances in Texas.

“The only Texas judicial case law has determined that city mandatory paid sick leave ordinances are unconstitutional,” said Robert Henneke, general counsel and litigation director at the Texas Public Policy Foundation and lead counsel for the plaintiffs in the pending ESI/Employee Solutions, LP et al v. City of Dallas lawsuit. “Now, the only credible, academic expert analysis of these Texas city regulations concludes that these ordinances are bad policy for workers, employers, and the Texas economy. As Trinity University Economics Department Chair Dr. David Macpherson concluded, these mandatory paid leave municipal ordinances will have a detrimental (not positive) effect on unemployment and the local economy.”