WASHINGTON _ Federal contract employees who are under the weather will no longer have to choose between working sick or losing a day's pay under a new Obama administration policy that takes effect in January.
The change comes under new rules the White House announced Thursday as part of an effort to help working families.
A second new rule will require large companies to report employee pay rates by race and gender.
The changes reflect the values and priorities of modern workers by recognizing that diversity is a strength and by empowering workers to thrive both at home and at work, White House senior adviser Valerie Jarrett told reporters on a conference call Thursday.
The sick-time mandate applies only to federal contract workers, but Labor Secretary Thomas Perez said he hopes employers will extend paid-leave benefit to all employees, including those not performing government work.
Employees would earn one hour of paid sick leave for every 30 hours of work performed on a federal contract, up to seven days per year. Employees could use the time for their own illnesses, for preventative care or to care for a sick family member. The time also could be used for absences relating to domestic violence, sexual assault or stalking.
"Giving sick worker the occasional option of staying home to receive care will decrease their recovery time and their chances of spreading illness," said Pennsylvania Gov. Tom Wolf, who joined Thursday's White House call with reporters.
That's why, he said, he provided paid sick leave to the 600-700 employees of the building materials company he owned before becoming governor.
"That was not a cost to the business. That was something we did because it made business sense. We had lower turnover, we had higher morale, we had healthier employees, and we had better productivity," he said.
Business leaders are concerned about a one-size-fits-all regulation's effect on their bottom line.
"It isn't necessarily that paid sick leave is a bad idea. The reality is that having the government dictate to the private sector exactly how, when and where you need to provide sick leave is not the practical way to do it," said Gene Barr, president of the Pennsylvania Chamber of Business and Industry.
The regulation harms business owners' ability to craft the kind of benefit plans that their employees and prospective employees want, he said. For example, in lieu of sick leave, one Pennsylvania business owner provides bonuses to employees who don't miss work. He probably couldn't afford to give the bonuses if he also had to pay employees on sick days, Barr said.
"This rule reduces the flexibility that employers have, and it reduces the ability of workers to latch on to a particular set of benefits that they may like better than another. They may prefer to have a bonus for attendance," he said.
Perez said the change will cost small contracting businesses between $174 and $3,000 per year _ less than .002 percent of revenue.
Under the new rules, companies with more than 100 employees will have to submit summary pay data to the Equal Employment Opportunity Commission.
"Pay discrimination often goes undetected because of a lack of information," EEOC chairwoman Jenny Yang said. "We can't let equality be left to chance."
Barr said businesses are concerned about sharing proprietary salary information that could get into the hands of competitors.
"What's the government going to do with this information? Are they going to use it for investigations? Is it going to be used as an embarrassment for companies?" he asked.
Individual company data will be treated confidentially, but the EEOC will release aggregates in studies of race- and gender-based pay disparities, said Yang.
Yang said the data would be closely safeguarded, but that doesn't lessen business leaders' concerns.
"Nothing is completely secure anymore. This provides another opportunity for somebody to improperly obtain proprietary information," Barr said.
Companies will have until March 31, 2018, to report data for 2017.
