Question: What is the fiscal impact of adding additional sick or annual leave days to the employee benefit package? (Councilman Chapman)
Response:
The primary impact of adding a day of sick or annual leave is on productivity and potential overtime costs for shift coverage. A single day of payroll costs approximately $1.1 million for positions in the General Fund. However, the actual cost of an added leave day would be significantly lower because not all departments require staff to cover a colleague’s shift while they are on leave.
Key considerations:
- An additional 8 hours of leave for the City’s 2,867 FTEs equates to approximately 11 extra FTEs in the annual budget if every shift were covered.
- Hourly/Non-Exempt Employees: Shift coverage may lead to overtime costs.
- Salaried/Exempt Employees: While salaries remain unchanged, productivity is impacted.
- Impact on leave payout: adding leave may incrementally increase leave payout amounts over time upon separation, but this amount is dependent upon usage and leave caps.
As an organization we evaluate all of our benefits for City employees as part of the comprehensive package of offerings to recruit and retain top talent. The attachment shows how the City’s leave policies compare to those of neighboring jurisdictions. As an organization, we evaluate all of our benefits for City employees as part of the comprehensive package of offerings to recruit and retain top talent.
It should be noted that the City offers six weeks of Paid Parental Leave to employees eligible for FMLA, which runs concurrently with FMLA. Once this paid leave is exhausted, employees may choose to apply the remainder of their 12 weeks of FMLA against their existing leave balances.[i] Employees who do not qualify for FMLA leave are eligible for up to 12 weeks combined of leave for prenatal care and parental leave, which can be charged against an employees’ existing leave balances.i Upon exhaustion of these other leave balances, any remaining leave would be unpaid leave.
Creative options for sick leave, telework, and bereavement:
Compressed Work Schedules
Compressed work schedules allow employees to work the standard full biweekly hours in fewer days. Common models include four 10-hour days (4/10) or a “9/80” schedule (nine workdays over two weeks, with one day off). For instance, the DC government permits a 9/80 schedule (five days one week and four the next, with eight 9-hour days and one 8-hour day, totaling 80 hours) or a four-day week of 10-hour days. Compressed schedules give employees a consistent extra day off, which has multiple benefits. Employees enjoy a better work-life balance and more time to recharge, leading to higher job satisfaction and less burnout. Agencies stagger employees’ off-days to ensure coverage (for example, half the team takes Monday off, and half takes Friday off), or close non-critical offices one day per week to generate facility cost savings.
Floating Holidays
The City does not currently offer floating holidays. These days can be used for time off for any purpose, subject to regular leave approval requirements, and expire at the end of the year if not used. They then renew at the start of the following year. Floating holidays are particularly beneficial for new employees who have not had an opportunity to accrue significant vacation or sick leave. Because these days do not accrue, the cost impacts are less than increasing sick or vacation days. However, cost estimates are highly speculative as the impact is solely to the increased workload absorbed by colleagues. This could have no cost impact or could result in colleagues incurring overtime/comp time in order to complete their own workload and cover for a colleague. It should be noted that this would likely require the organization to pay additional overtime for coverage purposes which is an increasing aspect of our budget over the past few years. Additionally, the City offers a generous comp time policy that provides employees with additional leave time for both hourly and salaried employees.
Telework
The City’s current telework policy is in line with local governments in the region, offering two days of telework per week for non-supervisory employees and one day of telework per week for supervisory employees. Upon approval, the City does provide some employees whose positions allow for more telework with greater use of this flexible policy.
Bereavement Leave
City employees typically receive a generous sick leave allotment. Rather than increasing the number of sick days, one approach to increase flexibility is allowing employees to use their accrued sick days for more than just their own illness. Currently, Alexandria offers 3 days of bereavement leave per occurrence, which is in line with many employers. Studies show most organizations offer 3–5 days of leave for the loss of an immediate family member and often fewer days for extended relatives.
To include annual leave, sick leave (including time from the sick leave bank for enrolled employees), compensatory time, leave donations, advanced sick leave, and, in rare cases, long-term disability.
Attachment:
Attachment 1 - Attachment Fiscal Impact of Increasing Annual or Sick Leave