Target – Paid Sick Leave (2022)

Outcome: Pending

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. (1) 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 percent) of the lowest earning 10 percent of American employees do not have access to PSL. (2) 48 percent of Latinx workers and 36 percent of Black workers report having no paid time away from work of any kind. (3)

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. State and local PSL mandates have been shown to reduce the rate at which employees report to work ill in low-wage industries where employers do not tend to provide PSL, lowering disease and overall absence rates. (4)

Over the years, Target has expanded its benefits package to employees, including increased starting wages, paid family leave, and tuition reimbursement, among others. During the pandemic, Target has supported employee health and safety through paid leave for quarantine and confirmed illness, 30-day paid leave for vulnerable employees, and access to free telehealth services and backup family care. (5)

However, Target discloses little detail on its paid time off (PTO) policy, noting, “Benefits include vacation, personal holiday, national holidays, well-being time, and bereavement.” (6) There is no disclosure of the average number of PTO hours earned, who is eligible for PTO and any probationary period before eligibility, or a carryover option. A lack of permanent PSL could pose reputational risk for Target whose commitment is to “care, grow and win together – and nurture team member well-being through competitive compensation and benefits.” (7)

Target could benefit from all employees having permanent access to PSL, and to publicly disclosing such a policy. The initial cost is relatively low – providing PSL is estimated to cost employers an average of

2.7 cents per hour of paid work (8) – and PSL both increases productivity (9) and reduces turnover, which in turn reduces costs associated with hiring. (10) This is particularly important for lower-wage industries like retail where turnover is highest. Proactively creating a permanent PSL policy would also address inconsistencies between labor markets since only 14 states have adopted PSL laws. (11)

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 Target.

Resolved: shareholders of Target 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 Target for a reasonable probationary period. This policy should not expire after a set time or depend upon the existence of a global pandemic.

(1) https://www.bls.gov/ncs/ebs/benefits/2021/employee-benefits-in-the-united-states-march-2021.pdf

(2) https://www.wsj.com/articles/companies-expand-paid-sick-time-leave-11632413861

(3) https://www.bls.gov/news.release/leave.t01.htm

(4) https://voxeu.org/article/pros-and-cons-sick-pay

(5) https://corporate.target.com/about/purpose-history/our-commitments/target-coronavirus-hub

(6)  https://leplb0420.upoint.alight.com/web/target/contentPage?articleId=D50F6BCB-95C9-44B3-BD1E82AEA0D405C3&linkId=L_HOMEPA_TIPS1&technicalNameForLink=L_HOMEPA_TIPS1&userFriendlyNameForLink=null&domain=YTR&baseClientIndicator=Client&languageId=en_US

(7) https://corporate.target.com/_media/TargetCorp/csr/pdf/2021_corporate_responsibility_report.pdf

(8) https://www.nber.org/system/files/working_papers/w26832/w26832.pdf

(9) https://voxeu.org/article/pros-and-cons-sick-pay

(10) https://www.ncbi.nlm.nih.gov/pmc/articles/PMC5649342/

(11) https://www.ncsl.org/research/labor-and-employment/paid-sick-leave.aspx

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