A national policy seen by investors as critical to support employees’ wellbeing, improve workforce equity and foster more resilient businesses in the post-pandemic economy.
NEW YORK, NY, TUESDAY, SEPTEMBER 28TH, 2021 – A group of more than 100 investors including State Treasurers’ offices, pension funds, domestic and global asset management firms, and faith-based funds collectively representing over US$1.6T in managed assets announced that they had sent a letter to Congressional leaders urging them to pass federal paid family and medical leave policy as part of the “Build Back Better” legislation pending in Congress.
The letter, organized by Trillium Asset Management and the Interfaith Center on Corporate Responsibility, was sent to Speaker Pelosi and Leaders Schumer, McCarthy, and McConnell on Tuesday. Investors underscored “the systemic risks that a lack of paid leave poses” and their belief that “portfolio companies and the U.S. economy as a whole would benefit from the support, standardization, and stability paid leave would offer working families.”
The letter follows a March 2020 investor statement calling on companies to prioritize worker health and safety during the pandemic, including the provision of paid leave, that was endorsed by 336 investors with US$9.5T in assets.
“The pandemic brought home the serious risks frontline workers face and highlighted the domino effects a lack of worker protections can have on business productivity and the economy,” said Kate Monahan, Director of Shareholder Advocacy for Trillium Asset Management. “A federal paid leave policy would provide an essential safeguard that would increase worker retention, morale, and productivity which is why it is supported by the investors, the Business Roundtable, and hundreds of businesses, large and small.”
Today, one in three Americans or 113 million workers don’t even have a single day of paid leave to care for themselves or their loved ones. These workers are overwhelmingly women, people of color, and low-wage working families.
A comprehensive paid family and medical leave policy includes three types of paid leave:
- Parental leave: time to welcome a newly-arrived child; applies to adoption, fostering, and birth, and applies to all parents;
- Family caregiving leave: time to care for a seriously ill family member, with an expansive definition of family, and;
- Personal medical leave: time to address one’s own serious illness.
Said Wisconsin State Treasurer Sarah Godlewski, "Because the U.S. is one of the few countries in the world without a national paid leave policy, the result is a painful patchwork of programs that leaves 80% of private-sector employees uncovered and exposed. This unacceptable burden on our workers and families is wrong and hurts our recovery. The paid leave proposal in President Biden’s Build Back Better plan addresses deeply-rooted inequities in paid leave access, especially for the millions of lower-wage working people who are often disproportionately people of color who currently have no paid leave at all.”
As women and people of color disproportionately lack access to paid leave, investors say a national paid leave policy is one of the strongest tools to counter workplace gender and racial inequities. Studies show that reducing gender inequalities in the workforce—in which paid leave plays a crucial role—has the potential to grow our GDP by at least 5%.
"The current pandemic has shown the disastrous consequences that the lack of paid leave for millions of U.S. workers has had on employees and business owners. That’s why the SEIU Master Trust is insisting that Congress pass a universal paid leave bill now,” said Alphonso Mayfield, SEIU Master Trust board member and President of the Florida Public Services Union. “SEIU members and those who employ them need a stable system of universal paid leave in order to succeed in the global economy and help us grow in the post-COVID years to come.”
President Biden’s paid leave proposal includes the key elements for high-quality policy: comprehensive coverage for a variety of caregiving reasons, wage replacement that allows all workers to afford to take time off, gender-equitable policies, expanding the definition of who is considered family, and ensuring that workers are allotted enough time to truly recover.
“This letter illustrates the transformation of and surge in support for paid leave that we’ve seen within the investor and larger business community over the course of the pandemic,” said Annie Sartor, Paid Leave for the U.S.’s (PL+US) Senior Director of Business Partnerships. “The COVID-19 crisis exposed how working families, businesses of all sizes, and the U.S. economy are held back by a broken care infrastructure that requires millions of working caregivers, especially women, to leave their jobs to care for their families when disaster strikes. With this letter, the investor community is making it clear that it wants Congress to pass paid family and medical leave both because it’s good for working people and because it's critical to building a stronger, more resilient national economy.”
“In order to truly “Build Back Better” we need to understand where the current weaknesses are in our economy,” said Iyassu Essayas, Director of ESG Stewardship for Parnassus Investments. “What do we need to shore up in order to build the kind of resiliency that will allow us to weather the inevitable storms that come our way? We need policies that safeguard workers and drive equity, both of which are foundational to a resilient, productive, and prosperous economy.”
About the Interfaith Center on Corporate Responsibility (ICCR)
Celebrating its 50th year, ICCR is the pioneer coalition of shareholder advocates who view the management of their investments as a catalyst for social change. Its 300-member organizations comprise faith communities, socially responsible asset managers, unions, pensions, NGOs and other socially responsible investors with combined assets of over $4 trillion. ICCR members engage hundreds of corporations annually in an effort to foster greater corporate accountability. Visit our website www.iccr.org and follow us on Twitter, LinkedIn and Facebook.