Thursday · 25 June 2020

A short history of paid sick leave

Posted by Call In Sick Tips Revealed · Filed under Sick Leave · Permalink

Paid sick leave was not invented by governments or by employers. In most industrial countries it began with workers paying each other. Friendly societies, mutual aid clubs, trade and guild funds all worked on the same principle: members contributed a small regular sum, and a member unable to work drew on the pot.

These arrangements were insurance in every respect except the name. They had membership rules, waiting periods, and inspectors who called on claimants at home. Many of the features that feel bureaucratic in a modern policy, the qualifying days, the requirement to notify promptly, the periodic review of a long absence, are inherited directly from societies run by and for the people claiming.

From mutual funds to statute

The mutual model had a structural weakness. It worked when the membership was large, young and in steady work, and failed exactly when it was needed most, during a downturn or an epidemic, when claims rose and contributions fell together. That fragility is the main reason states began to legislate, generally by making an existing voluntary scheme compulsory and underwriting it rather than by inventing anything new.

The result is that sick pay in most countries still carries the fingerprints of its origins. Where the mutual societies were strong, statutory schemes tend to be contributory and administered at arm's length from the employer. Where they were weak or absent, sick pay was more often bolted onto the employment contract itself, which is why some systems treat it as a benefit of the job and others as a social entitlement that follows the person.

The employer becomes the paying agent

A later and quieter shift was administrative. Rather than have an unwell person claim from a fund, many systems made the employer pay first and reconcile afterwards. This was efficient and it had a consequence nobody planned: the employer became the first arbiter of whether an absence was genuine, a role the old societies had kept away from the workplace altogether.

Much of the friction in modern absence management follows from that single design decision. The person who benefits from your attendance is also the person assessing your account of why you cannot attend. Every policy device that has since been invented, self-certification limits, return interviews, trigger points, is an attempt to make that conflict of interest manageable.

Knowing the history does not settle any current argument, but it does explain why absence rules so often feel older and stranger than the workplaces that apply them.