Labor Regulation and NYC Sick Leave

Debating Paid Sick Leave Laws

Jan 19, 2014 • Businesses, Demand, Supply, and Markets, Economic Debates, Economic Growth, Economic History, Government, Health Care, Labor, Macroeconomic Measurement, Regulation, Thinking Economically • 161 Views    No Comments

I wonder if we could say that Mayor de Blasio’s sick leave proposal dates back to 1895. 

119 years ago, concerned with the harm that a “biscuit, bread, cake bakery or confectionery establishment” could inflict on its employees, New York State passed the Bakeshop Act.

Regulation Labor Law

 

In 1902, a Utica, NY baker, Joseph Lochner, was fined $50 for an employee workweek that exceeded the 60-hour state-mandated maximum in the Bakeshop Act. On appeal, his conviction made it to the US Supreme Court. In Lochner v. New York (1905), the Bakeshop Act was declared constitutional and Lochner’s longer workweek became legal. In 1937, the “Lochner Era” ended when the Supreme Court reversed the decision.

Fast forward to 2014.

In NYC, the City Council will be voting on a bill that mandates up to 5 paid sick days for full-time employees in all NYC businesses with 5 or more employees. While NYC already has a sick pay law, the new one is much more extensive. It includes manufacturing establishments,  sick day care for siblings, grandparents, parents and children, and applies to smaller businesses.

Former Mayor Bloomberg and current Mayor de Blasio conveyed the sick pay tradeoff. Opposing the existing rules, Mayor Bloomberg said they imposed too great a financial strain on businesses. By contrast, Mayor de Blasio expressed his approval of a new law with,  ”This City Hall is going to be on the side of working families…”

The debate is timeless. For more than 120 years, we have been trying to identify the most productive balance between the freedom that the market system requires and government regulation of workers’ rights.

Sources and Resources: Yesterday, one of my morning walk podcasts coincided with the day’s news. I listened to Planet Money discussing the history of labor regulation and then, at home, there were the NY Times and WSJ headlines on the de Blasio sick leave proposal. I also went to this website for the Court’s opinion on the Lochner case and here for the Bakeshop Act.

 

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