Your Paid Leave Policies Will Impact Your Employer Brand

April 01, 2020

Contributor: Aaron McEwan

Remote work enables some employees to remain productive during the COVID-19 pandemic, but HR must tackle the issue of paid sick leave — whether employees work from home or not.

“If you feel sick, stay at home!” So goes the directive to workers across the world as the number of COVID-19 (coronavirus) infections grows. But what if not working means you don’t get paid?

In most cases, permanent employees in white-collar jobs who have been directed to work from home will continue to be paid as usual, and most receive some kind of paid leave they can access when sick, whether they now work remotely or not. But there are millions of employees whose employers don't provide sick leave — and may not need to, depending on the small print, even under government policies enacted during the pandemic. 

Organizations now face an ethical dilemma: Whether or not to provide benefits they aren’t legally obliged to offer. How they respond could have enormous implications for their employer brand, corporate reputation and even their financial survival. 

Read more: 10 Questions for an HR Pandemic Plan

Consider your long-term reputation with talent

The business continuity and emergency response plans of most organizations are typically business-led and focus on one-off events like cyberattacks and natural disasters, but COVID-19 could impact employers over months, or even longer. This pandemic requires much stronger input from HR given the direct and widespread impact on employees.

Initially, HR leaders rightly focused on how best to protect employees’ health, support remote working and ensure continuity of operations. Now HR must look to the longer-term implications. 

As quarantines and social distancing close even more businesses and institutions, more and more employees will be forced to take time off. The financial burden on workers will begin to impact not just part-time and contract workers, but permanent employees as well. 

Leaders are bound to look for ways to minimize spend and prepare for the worst, but cost-cutting initiatives and de-investment are known to damage employee experience

Employees across the organization may need time off to tend to their own health or that of loved ones, exacerbating already heightened anxiety about the economy and their own financial situation. Based on historical trends, female workers are likely to be disproportionately impacted. 

Even where sick leave and short-term disability policies exist and remain available to employees who are quarantined and can’t work remotely employee absences could extend beyond available sick leave. And some employees whose offices are suddenly closed might not be eligible for existing benefits. 

Organizations will have to prepare for all such scenarios and decide when to provide benefits. With the stock market reeling and the threat of recession looming, business leaders are bound to look for ways to minimize spend and prepare for the worst, but cost-cutting initiatives and de-investment are known to damage employee experience, which is critical for engagement and productivity. Rash decisions on benefits costs now could create long-term talent risks.

Read more: HR Under Pressure to Cut Costs? Know How to Protect What’s Important

Protect your brand as an employer

Our 4Q19 Gartner Global Talent Monitor report found that compensation, work-life balance and respect were some of the top reasons employees cited for leaving their jobs or joining a new employer. Even in normal times, workers want to see employers acknowledge their financial concerns and respect their unique family circumstances. They want to know that systems and processes are in place to support their emotional well-being as well as their ability to do their job well. 

In a crisis, employers have to consider how to respond to such demands as they become increasingly urgent. For organizations that employ hourly or part-time workers/or independent contractors, for example, that means considering the pros and cons of providing financial assistance beyond their legal obligations. 

For organizations that can bear the financial burden, one option is to do what some are already doing: Pay wages to those who are quarantined, unable to work, or ineligible for sick leave or short-term disability. 

How organizations respond to their employees’ needs during this crisis will have implications for their corporate reputation

Microsoft, for example, has committed to paying hourly workers their regular wages if they are unable to work as a result of COVID-19. Facebook has similarly committed to paying its contingent workers. And Amazon, Uber, Lyft and DoorDash have implemented limited emergency sick pay. 

This current dilemma also brings into sharp relief what has been a broader emerging trend: Employees want their employers to take a stand on social issues. Employee activism increasingly drives change and exerts pressure on senior leaders to act more ethically and demonstrate social responsibility.

In an age of radical transparency, HR leaders must carefully consider their ethical position on issues like paid leave. How organizations respond to their employees’ needs during this crisis will have implications for their corporate reputation and employer brand long after the pandemic has passed.

Aaron McEwan, VP, Advisory, helps HR leaders execute critical business objectives through the application of evidence-based HR and talent management practices. A behavioral scientist and coaching psychologist, McEwan believes that great ideas, backed by rigorous science, have the power to unlock the potential of individuals — every organization’s greatest asset.

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