Ever since the 1911 Triangle Shirtwaist Factory fire sparked a reckoning on worker safety and inspired decades of activism, labor policy has gradually faded from the public discourse while getting stuck in the mire of political and legal debate. Assuming we can all agree that fair employment should be a national priority, how can we move the policy conversation forward? This was part of the discussion I participated in at July’s Economic Security Summit, co-hosted by the Aspen Institute’s Financial Security Program and Economic Opportunities Program.
As employers and employees, we have an important role to play in these conversations. We have the ability to define labor policy simply through the actions and business decisions we make every single day.
At Hello Alfred, the company I co-founded nearly four years ago, our policy from day one was to put employees first, and we built that logic into our business model. As a national, distributed workforce offering help inside American homes, we recognized that treating our employees as our primary customers led to a superior experience for the customers who used our service.
At the time, emerging on-demand service platforms were celebrated for creating hundreds of thousands of new jobs. But their business models put user growth first — and relied on unstable freelance contract labor to scale. Many of those companies are now fighting for survival. As one of the companies featured in a New York Times article, entitled “Startup Leaders Embrace Lobbying as Part of the Job,” we work to provide a counterintuitive case study showing that the benefits, training, and protections built into W-2 employment are fundamental to all businesses, new and old.
So, how can we apply these same employee-first principles to create a pathway to greater economic security and wealth?
One way is to pursue the most bang for our buck by focusing our efforts on the majority of the workforce. More than 2 million Americans are employed by just two companies: Walmart (1.5 million) and Amazon (566,000). Many large private-sector companies (including Walmart and Amazon, with their respective moves to build healthcare ecosystems for their employees) are already attempting to rectify the steady erosion of worker protections and benefits.
But we might find greater, long-term impact by focusing on new businesses and building good jobs into the fundamentals of how entrepreneurs and company builders start new ventures.
Here’s how we can get started.
Make the business case. Good employment practices are fundamentally good business practices. At Hello Alfred, we’ve seen that borne out in the business logic, in terms of lower customer turnover, lower employee turnover, and higher satisfaction over time. Other emerging players like Stride Health are case studies in doing well by doing good that should be taught in business schools and emulated by entrepreneurs.
Water the roots with capital pools. Up to this point, entrepreneurs and company builders have assumed the burden of simultaneously waving a philosophy flag to broadcast their values and practices, while also working to get things done. When backers and boards actually buy into these principles, it eases that burden and enables leaders to implement good employment policies that can have long-term gain.
That’s what JUST Capital is banking on. The nonprofit ranks companies on a range of social issues, including employment practices, in hopes of redirecting the flow of capital and commercial investment to good actors that prove the business case for creating better jobs is strong and represents a competitive investment thesis.
Take consumers along for the ride. Consumers vote with their dollars. According to Nielsen, 66 percent say they’re willing to spend more for a product from a brand that demonstrated a commitment to social values like sustainability. Company builders can bet on the fact that their consumers, as employees themselves, will likely appreciate brands that show a similar commitment to fair employment.
Consumers want to know the story behind the brands they support. They want their favorites to stand for good values and practices. Brands that truly value their employees — and are able to tell an authentic story to their consumers — will see the business logic of standing for fair employment.
Level-set on what good looks like. At Hello Alfred, we think of ourselves as stewards of good employment with a responsibility to provide meaningful, fairly compensated work. MIT Sloan and others have recognized the importance of finding meaning in daily work. If we want entrepreneurs and company builders to build the foundation for greater economic security and wealth, they’ll need a shared understanding of what good jobs look like.
Here’s a set of baseline criteria and building-block values on good jobs that we should all be able to agree on:
- Basic protections dictated by law: fair hiring practices, health and safety, workers’ compensation, and non-discrimination.
- Competitive benefits for all full-time employees.
- Fair, transparent compensation that’s clearly tied to the success of the company.
- A sense of purpose and dignity in the work that is directly tied to the company mission.
- Training and fungible skills to give workers a path forward.
While a lot of work remains to clarify these criteria and negotiate 50-point balanced scorecards to grade companies on their efforts, we don’t need to wait for policymakers. If we can agree on this set of basic values, we have all we need to start creating a labor policy that supports good, meaningful work.
Marcela Sapone is co-founder and CEO of Hello Alfred, an in-home service and commerce platform for urban residential buildings.