COVID-19 Exposes Sharp Divide in Corporate Employee Relations

As the COVID-19 outbreak hits full blown crisis mode in the U.S., Kroger is among the retailers that has attracted unwanted media attention by distributing $25 gift cards to its employees. In other circumstances a $25 gift card would be a nice perk, if a rather ungenerous one considering the company’s reported $122 billion in revenue last year.

But these are circumstances unlike any other. Some corporate leaders are setting a high bar for worker care while others have some ‘splaining to do.

COVID-19 brutally revealed the corporate soul

If corporations are people, then the COVID-19 outbreak has exposed substantial moral fiber in some, and deep fissures in others.

In terms of worker protections under COVID-19, one company that has set a high bar is GG Hospitality, a boutique management firm co-owned by Singapore investor Peter Lim with former Manchester United players Gary Neville and Ryan Giggs.

Earlier this week Neville announced that the company’s Stock Exchange and Hotel Football luxury properties in Manchester, England will be closed to the public, and all 176 beds will be donated for free use by National Health Service workers in need of isolation from their families.

Neville also made it clear that taking care of the company’s workers is a top priority. As of this writing, the company reportedly has no plans to lay off employees or put any on unpaid leave.

“We feel that we have a responsibility to protect our team members,” he said at the outset of a brief video statement.

“Our company’s success is all down to our team and we feel it is critical that we look after everyone in these challenging times,” he emphasized in the middle of the statement. 

“We will do our utmost to ensure our team members are looked after,” he said at the end.

In contrast, Kroger’s offer of $25 per employee (a benefit that must be used in 60 days) is pretty weak tea.

A gaping hole in federal policy

To be fair, Kroger is not alone in failing to develop a responsive sick leave policy. Unlike firms in the hospitality industry, supermarkets have been admonished to stay open during the crisis.

Journalist Judd Legum has been taking a deep dive into the supermarket worker issue for the newsletter Public Information, in which he describes why the newly passed federal sick leave policy is not helping many supermarket workers.

The policy exempts companies with more than 500 employees, on the assumption that large employers already cover their workers with fairly respectable sick leave benefits.

That is not necessarily the case, especially in industries that rely heavily on part-time workers. Many companies, like Kroger, do not necessarily offer sick leave to part-time workers.

In addition, companies with sick leave benefits for full time workers may be entitled to withhold pay from the first day off, depending on variations in state labor laws. Another loophole applies to new workers and recent hires, who are generally not entitled to paid sick leave until months into their tenure.

The tenure-based restrictions will directly impact workers at supermarkets that are scrambling to hire additional workers to handle the crush of panic-fueled grocery shopping.

Where are the COVID-19 tests?

There is another loophole of even greater consequence. As noted by Legum, Kroger amended its sick leave policy, but it only applies to workers who are under 14-day quarantine after testing positive for the COVID-19 virus.

Walmart, Olive Garden and McDonald’s are also among a growing number of companies to offer similar test-linked policies — and that’s the problem.

The fact is, there is no COVID-19 test widely available in the U.S. and there won’t be for weeks, even as the number of confirmed cases skyrockets and hospitals run short on supplies.

In other words, many workers are on their own if they feel sick and need to stay home.

The same goes for other workers who may feel well enough to work but need a test because they are concerned about potentially spreading the virus to others, especially if their household includes someone who is elderly or has underlying medical conditions.

As for why the U.S. did not begin to ramp up testing and take other steps to prepare months ago, that picture is beginning to come into sharper focus.

In a special report on March 18, Reuters noted that South Korea reported its first COVID-19 case in January, on the same day that the U.S. reported its first case — yet South Korea (population 51 million) has already tested more than 290,000 people, while the U.S. (population 330 million) has only completed approximately 60,000 tests as of press time.

The results are stark: with testing and other aggressive measures at full scale weeks ago, South Korea now appears to have weathered the worst of the crisis. In the meantime, the U.S. is only just beginning to reel under the blow.

Reuters and other news organizations have described number of elements with at least one common denominator: a profound lack of leadership and direction from the top, with much the resulting chaos attributed to the U.S. President’s years-long work of dismantling the nation’s existing preparedness systems.

Another piece of the puzzle is the role of the President’s ubiquitous son-in-law and office advisor Jared Kushner.

“[He] has created his own team of government allies and private industry representatives to work alongside the administration’s official coronavirus task force, adding another layer of confusion and conflicting signals within the White House’s disjointed response to the crisis,” The Washington Post reported on Wednesday.

Mother Jones and other news organizations are now questioning whether Kushner’s familial relationship with the "tech-driven" health insurance company Oscar may have played a role in the flat-footed federal response to the COVID-19 threat.

As described by Mother Jones, Oscar was co-founded in 2013 by Kushner and his brother Joshua, through a holding company.

That’s a whole ‘nother can of worms, as the saying goes. In the meantime, Congress has left quite a sick leave mess for the private sector to clean up.

Rolling up their collective sleeves and tackling the problem in a meaningful way will be a true test of character for corporate leaders. Some have already fallen down on the job, but there is still plenty of time to pick themselves up and get to work.

Editor's note: 3BL Media realizes many organizations have not budgeted for communicating their response to COVID-19. 3BL believes it’s important to help these purpose-driven organizations share how they're working to keep their customers, employees and communities safe. Organizations with press releases that fall into this category should feel free to submit them to COVID19@3blmedia.com for distribution over the CSRwire network at no charge.

Image credit: Wesley Tingey/Unsplash