Why Does the Private Sector React Like the Public to Law 133? A Microeconometric Analysis of Sickness Absence in Italy

Abstract

The problem of absenteeism has taken the centre of the stage of public attention when Renato Brunetta, the Public Employment Secretary, launched a reform of the public sector which started with a law on absenteeism. After the law was passed, the first evidence collected showed an average drop of 47% in sickness absence. This result was received with scepticism, but now we have enough evidence and research to draw some firm conclusions. This paper plans to investigate the effects of the Law 133/2008 and the shocks occurred after the changes in the law itself. We will study how employees characteristics in the private and public sector are related to absentee behaviour. The relationship between individual characteristics, such as wage, gender, age, tenure, education and the labor-leisure decision made by workers will be estimated in a micro-data model. The data come from a panel of individuals working in a large private company, operating all over Italy in the security sector, and one public sector institution,(AE) the tax collection Agency. The results indicate a remarkable direct and indirect reaction to the law in the public and also private sectors.