I was a small business owner so I am terribly familiar with how they works...please explain to me how your theory wouldn't cost me anything? Or a large company anything? I see it would cost everyone a lot. It sounds like people will be paid for 10 days for nothing. As the owner of a small business if I didn't work I didn't get paid. If people who work for me didn't produce I didn't get paid, so I would have no way of paying them.
Businesses of most sizes are encouraging their employees to take preventative measures like paying for their flu shots to reduce the amount of sick leave. It make more sense to encourage prevention than rewarding sick time.
He is saying this, to keep math simple of course we will just use round numbers:
You have 5 (or any amount) employees in your business, they get paid 5 bucks an hour, 40 hours a week, but you provide no sick days as of yet.
Every january they get 10 sick days to use sparingly when absolutely needed, you already pay them 10400 dollars a year if they work full time (5x40=200x52 weeks)
take 10 days pay (80 hours) or 400 dollars, and keep it set aside, deducted slightly from each pay check.
So now each employee gets 4.80 an hour (20 cents isn't a huge difference) and at the end of the year if they haven't used their sick days up, they get the remainder of the 400 dollars in a lump sum, like a bonus, if they have used it up, its already been set aside and paid for - by them, at no cost to you. Instead of paying them 10400 a year, you paid them 10000 annually with a 400 dollar bonus, OR if they used their sick days, you paid them 10400, either way, you spend the same amount, they lose a minimal amount of pay up front, but it's the same at the end of the year (20 cents/hr adds up to 8 dollars a week) and they get sick time.