CVS Health Corp – Paid Sick Leave (2023)
Outcome: The proposal received a vote of 26.2% at the annual meeting.
Whereas: More than 26 million people working in the private sector have no access to earned sick time, or “paid sick leave” (PSL), for short-term health needs and preventive care. Working people in the United States face an impossible choice when they are sick: stay home and risk their economic stability or go to work and risk their health and the public’s health.
The vast majority (77%) of the lowest earning 10% of American employees do not have access to PSL. 48% of Latinx workers and 36% of Black workers report having no paid time away from work of any kind.
As the COVID-19 pandemic has shown, PSL is a crucial contributor to public health, allowing workers who have been exposed to any illness to quarantine. One study found a 56% reduction in COVID-19 cases per state as a result of temporary federally mandated PSL, and others an 11-30% reduction in influenza-like illnesses from state and local mandates. State and local PSL mandates have also been shown to reduce the rate at which employees report to work ill in low-wage industries where employers don’t tend to provide PSL, lowering disease and overall absence rates.
A lack of PSL could pose reputational risk, especially for a healthcare company like CVS Health (CVS), which describes its mission as “take on many of the country’s most prevalent and pressing health care needs.” Although CVS provides PSL for full-time employees, almost one third of employees are part-time and therefore ineligible.
CVS could benefit from all of its employees having permanent access to PSL. Research finds PSL both increases productivity and reduces turnover, which in turn reduces costs associated with hiring. This is particularly important for lower-wage industries like retail where turnover is highest. Additionally, a significant portion of CVS’s part-time workers are likely covered by state or local mandates or collective bargaining agreements. Proactively establishing PSL for all employees would help prepare CVS for potential regulation. Thirty-eight jurisdictions, including fourteen states, have adopted PSL laws since 2006.
We believe adopting a comprehensive, permanent, and public PSL policy would help make the future operating environment more equitable and mitigate reputational, financial, and regulatory risk to CVS.
Resolved: shareholders of CVS ask the company to adopt and publicly disclose a policy that all employees, part- and full-time, accrue some amount of PSL that can be used after working at CVS for a reasonable probationary period. This policy should not expire after a set time or depend upon the existence of a global pandemic.