Definition
The term sick pay is used to describe compensation provided to an employee when they cannot work due to an illness or injury. While companies oftentimes provide their employees with sick pay, this benefit is not required under federal law.
Explanation
Also referred to as paid sick leave, sick pay provides an employee with a normal day's compensation when they are not able to work one of their regularly scheduled workdays due to an illness or injury. While federal law, such as the Fair Labor Standards Act (FLSA), does not require companies to pay an employee when they are not at work, the Family and Medical Leave Act (FMLA) entitles eligible employees of covered employers to take unpaid, job-protected leave for specified family and medical reasons.
State and local laws, as well as company policies and bargaining unit agreements, oftentimes provide paid time off when an employee is sick. Providing an employee with paid time off not only helps retain valuable employees, but also prevents the spread of illness in the workplace.
Employees are normally given a predetermined amount of sick days annually, which is usually based on a calculation that takes into account the number of years the employee has worked for the business. New employees may be required to accrue sick days during their first year of employment. Some organizations allow employees to "bank" their sick leave, meaning they can carry unused days into future years.
Note: Employees are normally responsible for contacting their manager or supervisor prior to the start of their workday if they are taking a sick day unless a medical emergency prohibits them from doing so.
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