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Insurance or Entitlement?
Wednesday - 7/8/2009, 4:00am EDT
According to various news reports (like this one on NPR), between 40 and 50 percent of American workers don't have any sick leave benefits. None. If they don't show up for work they aren't paid for that day.
Mostly these are people in low-wage jobs working in small service operations.
Many companies that do offer sick leave don't allow employees to carry over unused leave from one year to the next. And they monitor its use. Workers who take two days in a row may be required to get a certificate from a doctor.
(In a previous life I had built up more than 2,200 hours of sick leave. One day the company announced that the maximum anybody could have was 1,000 hours. So the other 1,200 just disappeared. Stuff like that makes you sick!)
When it comes to sick leave, Uncle Sam is one of the most generous employers. Workers can accumulate sick leave and, some of them, can get credit toward retirement for their unused leave. One year's worth of leave added to length of service will boost the lifetime annuity by 2 percent.
So, what's your take on sick leave:
- Is sick leave a form of short-term disability insurance to be hoarded for hard times? Like when you are actually sick.
- Is sick leave an entitlement with no value or payoff unless you burn it up before you quit or retire?
The answer may depend on which federal retirement system you are under.
FERS vs. CSRS
- If you were first hired before 1983, and under the old Civil Service Retirement System, you probably see sick leave as something to be conserved. To be taken only when absolutely necessary. Because it is worth money at retirement. You can apply it toward service time and boost your lifetime annuity.
- If you are one of the (majority) who are under the newer Federal Employees Retirement System you may have a different take on sick leave. It has no end-of-the-line cash value. You get no credit toward service time. So, as your departure date approaches you take more sick leave. It's called the FERS Flu!
For many years feds couldn't credit sick leave toward retirement. There was evidence of sick leave abuse. Studies showed that a lot of people were using a lot of sick leave just before retirement. As a result, Congress decided to give feds an incentive not to use sick leave when they weren't ill. It came up with the idea of allowing them to tack on hours of unused sick leave to their service time. Each one year of sick leave boosts the lifetime annuity about 2 percent.
But when the FERS retirement plan was set up in in 1980s to replace CSRS, Congress didn't provide any service credit for unused sick leave. Result: The Birth of the FERS Flu. It's been going on ever since.
The solution, many believe, is to give FERS employees the same incentive to save their sick leave. To that end, Virginia Rep. Jim Moran (D-Va.) has introduced a bill that would give FERS employees the same incentive to save their sick leave.
Bill Bransford of the Senior Executives Association says that the proposal makes sense from a management standpoint. Eventually, everyone in government will be under FERS, and something is needed to give employees an incentive to save their leave rather than burn in up in the final months of employment. Bransford was our guest on our "Your Turn with Mike Causey" radio show. If you missed it, it is archived. To listen to it, click here.
Nearly Useless Factoid
The 60-Second Science Blog from Scientific American reports "volume changes in music affect heart rate and other physiological markers." Further, "these physiologic effects might intensify our emotional response to music." Now if they can just figure out why.
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