AUSTIN (KXAN) — The Austin City Council is going forward with its sick pay ordinance, becoming the first city in Texas as well as the South to have mandatory sick pay. It passed early Friday morning around 12:40 a.m. Council members Ora Houston and Ellen Troxclair voted against it. The ordinance takes effect Oct. 1.
The vote came after four hours of public feedback, and about an hour of debate over amendments. The ordinance says that denying earned sick time to employees “is unjust,” “detrimental to the health, safety, and welfare of the residents of the City” and “contributes to employee turnover and unemployment, and harms the local economy.”
“This is going to affect a lot of people in our city that probably are right now coming into work sick and probably serving food on days that they shouldn’t be,” Mayor Steve Adler said after the vote.
The ordinance will allow Austinites who work for a business with 15 or more employees to earn up to eight paid sick days each year, accruing one hour for every 30 hours worked. Those who work for smaller businesses can earn up to 6 days — but if the business is smaller than 5 people, the ordinance goes into effect in October 2020. Employers will not be allowed to ask for a doctor’s note unless employees miss three straight days of work.
While the council chamber was packed with those supporting the measure, some small business owners spoke before council saying while they are for paid sick leave, some of the wording in the ordinance is tricky.
“One of the biggest issues with the language that we have an issue with is the subpoena power that the city is giving themselves,” says Frank Fuentes with the US Hispanic Contractors Association. “When somebody will file a complaint, the city gets the subpoena power to request or get the books from small businesses. It’s unimaginable. It’s very worrisome to small businesses because now they will have to find a way to defend themselves.”
That subpoena power has since been removed.
“The city can only ask for the very minimal records that directly address the questions involved,” Mayor Adler said.
Thursday night, Adler tried to calm the fears of business owners. “I understand and I appreciate the concerns that many businesses have about the potential impact, but there have been lots of studies in lots of cities that have done this, and it just does not bear out the way some of the businesses are concerned, and I would expect the experience in Austin to be the same,” Adler said.
KXAN looked at feedback from businesses in San Francisco. The city passed its own paid sick leave ordinance in 2007. Two years later, researchers analyzed a survey from more than 700 businesses. They found 39 percent of firms reported reductions in other benefits and 32 percent said the policy hit their profitability. But 17 percent of firms reported better employee morale and 71 percent said they saw high support for the policy.
Mike Rollins, president of the Greater Austin Chamber of Commerce, issued a statement Friday morning saying the ordinance was “rushed” and “not founded on factual, Austin-based economic data.”
“Council ignored restaurant owner pleas about the average expected $150,000 hit to their razor-thin margins. Even worse, Council rushed to a final vote late last night. None of this is in line with Austin values,” said Rollins.
State Rep. Paul Workman, R-Austin, said he’s against this ordinance and plans to file a bill early next year when the legislative session begins to reverse similar policies he says are an overreach.
“We have the paid sick leave, we have the fair chance hiring ordinance and their expedited permitting ordinance — all three are ordinances which we believe are wrong and shouldn’t be done by the city,” he said.
Workman says he’s OK if the city does this for its own employees, but not for private employers.
The city of Austin’s Equal Employment Opportunity/Fair Housing Office would be in charge of investigating any complaints or violations. The city may assess a fine of up to $500 for a violation by a company. KXAN reached out to the office, which says it will be developing administrative rules to determine exactly how the process will work and what additional resources are needed.
Troxclair, who voted against the measure, got emotional during some of the feedback for the way the public was reacting.
“Being in this room tonight and hearing this crowd hiss at people who have given up their time away from their families to testify. I take responsibility for what I say up here and the votes that I take, but it was so incredibly disrespectful for those people to be treated the way that they were tonight, and so I have no doubt that that’s exactly how they were treated throughout this inclusive stakeholder process.”
“There were a lot of people at the meeting that were suggesting that we didn’t deserve to exist. And that we were all exploiting our workers and that is so far from the truth,” Shelley Meyer, co-owner of Wild About Music told KXAN. “Our workers are our family and small businesses are the heartbeat of Austin.”
Wild About Music actually already offers paid time off.
“We feel paid time off is more flexible and that sick leave is more restrictive, and so we just want to be able to offer what we’ve already offered our employees and hope that we still can,” Meyer said, saying the details are still largely unknown to employers.
The final draft has yet to be posted to the city’s website for people like Meyer to fully review.
“Of course we feel that we should be able to make our own decisions and that some of these city policies seem overreaching, but in the end people do need to be taken care of when they’re sick and they need to be able to take a day off if they’re ill. So it’s hard. It’s hard to walk both sides of that line,” Meyer said.
The new ordinance will impact an average of 200,000 people.