COVID-19 has revealed some uncomfortable truths about how badly workers have been struggling in our country. The scope of medical and economic suffering has been sobering, and has forced many of our country’s leaders to think about how we can make things different — better — moving forward. More specifically, executives of some of the world’s largest corporations are rising to the occasion and making life better for their workers, blazing the trail for enhanced employee services and benefits moving forward. But beyond good PR optics and enhanced employer brand, is there direct ROI on such initiatives? We took a look at what some of the experts are saying.
The most important way employers of essential workers have been responding is by ensuring the physical health and safety of workers. Not limited to just personal protective gear like masks, gloves, and hand sanitizer — many of the nation’s largest employers have been offering extended sick leave, free Coronavirus testing, and enhanced healthcare options.
These measures are rightly seen as table stakes though, and several employers have gone further by ensuring workers’ financial security in addition to physical health. JUST Capital found that of America’s 100 largest employers, 38 have provided workers with some type of financial assistance during the pandemic. These measures range from one-time cash bonuses to hourly wage increases.
We’ve also seen some companies take more dramatic measures — some symbolic, and some more tangible. Out of the 100 companies whose corporate responses JUST Capital has been tracking, one of them — Charter Communications — has announced that the wage increase for employees will be permanent, and not only during the COVID-19 pandemic. Meanwhile, CEOs at some of the country’s most recognizable companies like Delta, Comcast, Disney, and General Electric are cutting or foregoing their salaries altogether; moves that signal empathy and solidarity with their workforces. Companies that have done nothing, or taken steps in the wrong direction, have seen less favorable results.
Investing in workers’ financial health has already proven to be beneficial for companies’ bottom lines. Research bodies like PwC and Northwestern Mutual found that when employees are financially stressed, businesses can lose millions of dollars due to lowered productivity, and higher absenteeism and turnover. Companies that take care of their workers are in turn rewarded with those same workers taking care of customers. The result is an overall lift for business.
The COVID-19 pandemic is serving as a microcosm of this same concept. A recent analysis on environmental, social, and governance (ESG) issues by Commonwealth found that companies focusing more on social factors — specifically the financial wellbeing of employees — were seeing positive results. Commonwealth cited an Edelmen study which revealed how treating employees well can directly impact business: 29% of consumers say they’ve switched over to a new brand because of the “compassionate way they have responded [to the pandemic].” At the same time, 27% of consumers actively try to convince those around them to stop using a brand they feel is “not acting appropriately in response to the pandemic.”
JUST Capital also found that companies that were treating workers better during the pandemic were recovering financially more quickly than similar businesses. More recently, JUST found that businesses with strong corporate responses aren’t just recovering better, but they’re outperforming other businesses in their industries. The analysis showed that companies that are “prioritizing their workers” are not only seeing the fastest recoveries, but also seeing “outperformance relative to their industry peers.”Focusing on workers pays off in more ways than one
The companies making the boldest moves were also amplified by Forbes’ recent “New ranking of the nation’s top employers’ responses to the pandemic.” The list, with Verizon, Target, AT&T, and Walmart among the top five, highlighted that while many companies on the list are “not free of controversies,” treating workers right can impact the bottom line while also generating positive press and impacting the employer brand. In that same vein, S&P Global Market Intelligence noted that while CEO pay cuts are “largely symbolic,” they can help companies avoid becoming a “poster child for inequality and indifference in this moment where the world is searching for ethical and compassionate leaders.”
For many companies, the desire and will to do better by workers exists, but showing business value is critical before being able to move forward. What these reports and analysis show is that investing in the health and security of employees — not just physical, but also mental and financial — isn’t just a loss leader. It can visibly impact a company’s industry performance, public relations, and employer brand.