" This policy change will reduce the Board's long-term liability, provide a substantial annual cost savings and meet the original intent of sick leave. - BPW Manager Donnie Hardin It sounds like a great idea - to reduce the Gaffney Board of Public Works' liability by eliminating its accrued sick leave policy.

But that likely didn't stop the utility's commissioners from wincing a bit when they learned the initial cost to buy back employees' accrued sick days - about $1.1 million.

The one-time buyback will occur next month. Employees will have the option to invest their accrued sick leave reimbursement in the utility's retirement plans.

Under the utility's current policy, employees receive one sick day per month. Those sick days can accrue to a maximum of 720 hours.

That will change in March when the utility adopts a combined personal time off (PTO) policy. The policy replaces the current sick leave policy with short-term and long-term disability insurance.

Gaffney Board of Public Works General Manager Donnie Hardin said the change was needed to reduce the utility's long-term liability.

Hardin said the utility's sick leave liability rises each time salaries, employer payroll taxes or employer South Carolina Retirement System contributions increase.

Hardin estimates the Board's sick leave liability will climb to $1,103,564.25 on March 1. Hardin said he'll fund the buyback plan from the general operating budget. Hardin said the buyback won't necessitate a rate hike.

"This policy change will reduce the Board's long-term liability, provide a substantial annual cost savings and meet the original intent of sick leave," Hardin said. "It will provide for the security of employees' families in the event of an unexpected and serious illness or accident."

Hardin said commissioners inherited the current sick leave policy.

"The current Board and management didn't create this situation," Hardin said. "The basic sick leave plan, including the carryover and 720-hour limit has been in effect since at least the early 1970s.

"The current Board and management is trying to address the increasing liability and cost associated with a policy that allows carryover from year to year and at the same time provide an equal benefit to employees that better protects their families. We feel this change is a win for employees and a win for the Board."

The change will impact the Board's bottom line immediately. Hardin said the Board will save an estimated $235,983 the first year and will recover the cost of the buyback in 3.7 years.

The change to a shortterm and long-term disability plan will help employees, according to Hardin. Commissioners don't receive the benefit.

"The disability insurance will pay employees 60 percent of their gross salary for an extended illness or accident and the benefit is taxfree to employees," he said. "The disability insurance provides coverage from day eight of an illness or accident through age 67 if the employee should become totally disabled.

"Under the current policy, in the event of a serious illness or accident that prevented an employee from working for a period longer than the amount of sick time they had accrued and saved up to a maximum of 12 weeks, they would be terminated and receive no further income from the Board."

Hardin said he won't benefit personally from the change.

"Employees who saved their accrued sick leave over the years are not benefiting any greater than those employees who used and were paid for every day of their sick leave over time have benefited," he said. "Under the current policy all employees, not just myself, with over 20 years service are paid for all their accrued sick leave at retirement."