Companies pledge not to lay off workers amid COVID-19 unemployment crisis

April 14, 2020

A record 6.6 million Americans applied for unemployment benefits last week. But several employers—in the consulting and financial services sectors—have pledged to hold off on job cuts, and are offering workers a financial cushion, The Washington Post reports.

Indeed, as early as evening of March 19—as stay-at-home orders were just going out in a number of states , but reports of job layoffs already were surging—New York City-based professional services firm Marsh & McLennan CEO Dan Glaser made a pledge to his employees.

“I want to say to all of you that while we are in the thick of this global pandemic, your job is secure,” Glaser said in a video message to the firm’s 76,000 global employees, including workers in its insurance and risk management, human resources, management consulting and reinsurance brokerage businesses.

“There will be no counting of sick days or vacation days until things return to normal,” he reassured workers, announcing the creation of a $5 million fund that would offer grants to employees facing financial hardship and reminded people of the “formidable resources and financial strength” of the company. “We will be fine — if you are fine.”

As the coronavirus pandemic ravages the economy and brings a once-roaring labor market to a near-screeching halt, layoffs have mounted at a stunning pace, the Post reports.  For Glaser, the calculus of making such a temporary pledge is far different than for a small retailer or travel industry start-up. Although he expects a “rough period,” he said, “we are among the fortunate not to have to worry about profitability or whether we’re going to survive.”

But because Marsh & McLennan is in what Glaser likes to call “a brains business” — reliant on his employees’ ability to focus on clients— he wanted to assuage fears and concerns. “Are we really going to have somebody remotely call somebody at their home— not knowing their personal circumstances in any degree, not knowing whether they have a loved one in the next room who’s struggling—and let them go?” Glaser said in an interview with the Washington Post. “What would that say about us as a company?”

Several large financial institutions, including Morgan Stanley and Bank of America, said last week they will suspend layoffs until the end of the year.

“We don’t want our teammates to worry about their jobs during a time like this,” Bank of America CEO  Brian Moynihan said in a CNBC interview posted on March 27. “We told them there’s no issue, you’re going to be working now through year end. No layoffs, nothing. We’ll continue to pay everybody.”

San Francisco-based payments company Visa will have no COVID-19 layoffs in 2020, CEO Alfred F. Kelly Jrsaid on LinkedIn.

Salesforce CEO Marc Benioff pledged March 25 “not to conduct any significant lay offs over the next 90 days,” and to continue to pay hourly workers while offices are shut down. He also encouraged employees to keep paying dog walkers and housekeepers during the crisis.

In subsequent tweets, the Post reports, he encouraged other chief executives to follow suit, calling for a “90-day CEO no layoff pledge.”

Research contact: @washingtonpost

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