Paid Sick Leave: Cost or Investment?

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Article2020 | 10 | 05

Paid Sick Leave: Cost or Investment?

Employers are obliged to ensure, so far as is reasonably practicable, the safety, health and welfare at work of all their workers. This would include ensuring that employees who should not be at work are, in fact, not at work.

Due to the pandemic, businesses are being encouraged to have employees review screening information before attending work and stay home if they are experiencing symptoms of COVID-19 (such as cough, fever, runny nose, sore throat, breathing difficulties, etc.) or if they have travelled or been exposed to a case of COVID-19.

Some employers have chosen to provide paid sick leave to their employees, but in Manitoba, at least, that is not required by law. The closest statutory requirement we have applies to an employee who is expected to be incapable of working for a period of at least two weeks because of a serious injury or illness, who is entitled to unpaid time off.

As a result, unless an employer voluntarily chooses to pay for sick leave, an employee must take time off without pay. Employees who respond honestly in the context of COVID-19 screening and so are ‘rewarded’ by time off without pay might be tempted to hide their true circumstances so as not to lose pay. This puts other employees and customers at risk.

It likely is a stretch to conclude that employers are legally required to provide paid sick leave to live up to their duties to maintain a safe workplace. Still, that is something an employer properly should consider, particularly during this period of pandemic. Put another way, is paid sick leave a cost to be avoided, or an investment to be made?

Employment standards legislation is by definition a statutory floor of rights providing certain minimums below which employers and employees cannot legally agree to be bound. It is not a one-size-fits-all statute which mandates that everyone must operate at that lowest level. Rather, it provides certain minimum protections or standards which society has determined are required. Provided such minimums are met, it is up to employers to make their own determinations as to how they wish to operate and which expenses they see as worthwhile.

As an example, no employer is legally required to pay more than minimum wage, or provide group insurance benefits or pension, or support ongoing education through time off work or by paying for such courses. That said, from a big picture perspective it may make sense to do so. Deciding on whether or not to invest in employees and the business in these ways (or by paid sick leave) should be based on the economics and other market realities at hand.

To provide paid sick leave provides an incentive for behaviour the employer wishes to encourage and removes the incentive for behaviour it wishes to discourage.

It provides a strong message to the public and the employees that the employer is genuinely concerned about the health of those who work there and those who may choose to attend as customers.

We all have choices available to us as either employees or customers. We seek employment with employers who are seen as good employers, who offer fair compensation, benefits and working conditions. As customers we support those businesses which offer products or services we like, at a fair price and are convenient. Often, all things being equal we prefer those who offer an atmosphere or culture that we find welcoming and desirable, worthy of our support. In some cases, however, some of us will even choose to support businesses which may provide less selection, somewhat higher prices, and are less convenient, simply because of who they are, and the atmosphere or culture offered.

Paid-sick leave is not necessarily an all or nothing choice. It could be offered to deal only with COVID-19 related absences from the workplace and could be brought in on a trial basis such that if the employer found the system were being misused, it could be ended. The amount of sick pay does not have to be 100 per cent of the regular pay but could be some lesser amount. Perhaps only employees with a certain amount of service qualify, presumably on the logic that by their length of service they have proven themselves to be deserving of this benefit.

Some businesses or industries by their very nature will be more or less at risk. It is easier and much less costly for an employer to offer the possibility of paid sick leave when the actual risk of it being used is much lower. Conversely, the more likely someone is going to be taking this paid sick leave, the more it will cost.

There obviously will be employers who simply are not in an economic position to provide any paid sick leave at all. Those employers can instead consider allowing employees to access other paid leave such as by taking vacation time, or using banked time which they have accumulated, or borrowing against future earnings. Failing any of those solutions, employees may be required to rely on the public security system we have in place, which at present includes the Canada Emergency Response Benefit, Employment Insurance and/or Canada Pension Plan sick benefits and encouraged through moral suasion to stay at home if need be.

What suits a particular workplace is going to depend to a large extent on the people involved and the choices the employer makes. Above all, such choices should be reasoned and thoughtful.

Jeff Palamar is a partner with the Winnipeg Law firm Taylor McCaffrey LLP, and the leader of its Labour and Employment Law Practice Group. Taylor McCaffrey LLP is the exclusive Manitoba member of the Employment Law Alliance, the world’s largest network of labour and employment lawyers. Since 2008 Jeff has been listed in the peer selected best lawyers in Canada in his field. His practice focuses on helping employers thrive by finding creative and proactive solutions to the challenges they face. As published in Prairie Manufacturer Issue 2, Volume 5.

DISCLAIMER: This article is presented for informational purposes only. The views expressed are solely the author(s)’ and should not be attributed to any other party, including Taylor McCaffrey LLP. While care is taken to ensure accuracy, before relying upon the information in this article you should seek and be guided by legal advice based on your specific circumstances. The information in this article does not constitute legal advice or solicitation and does not create a solicitor-client relationship. Any unsolicited information sent to the author(s) cannot be considered to be solicitor-client privileged.

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Jeff Palamar
Jeff Palamar