Employee Hardship Funds Help Companies Help Their People

Employee Hardship Funds Help Companies Help Their People

by Jenny Calvert Rodriguez - May 21, 2020

The types of hardships affecting employees in the Covid-19 crisis happen at a smaller scale all the time. The Federal Reserve has reported that 40 percent of American families do not have sufficient savings to deal with a $400 emergency expense - and that was before the historic wave of unemployment and economic fallout related to the pandemic.

An employee hardship fund is a tool to ensure that employees and their families can weather an unexpected crisis. When done correctly, this model is a critical tool to help combat financial instability. At the Red Tab Foundation (RTF), Levi Strauss & Co.’s employee hardship fund, we have nearly 40 years of experience to draw on when responding to these kinds of moments. We were founded in 1981 by stock boy-turned-Levi Strauss & Co. executive Jerry O’Shea, who wanted to ensure that no employee or retiree would go without a financial safety net. We’re funded by a combination of large gifts from company leaders, descendants of Levi Strauss, and employees at all levels of the organization around the world. Since its inception, RTF has disbursed more than $35 million and has been recognized as a standard bearer for employee hardship funds.

RTF offers assistance to employees in times of personal hardship - to help someone make a rent payment, for example, or get their car repaired so they can get to work. Applicants work with a case manager to verify their eligibility, and a no-strings-attached grant is issued to help meet the client’s needs. Since the Covid-19 crisis began, we’ve fielded three times the customary number of requests from employees who - like all of us - are grappling with these uniquely uncertain times. And as we’ve seen an influx of requests for grants, we’ve also seen an influx of messages from other companies looking for advice on starting an employee hardship fund of their own.

It’s a tradition at LS&Co. to open source company knowledge that can benefit people and the planet. In this spirit, we created the Red Tab Foundation’s Employee Hardship Fund Playbook, which provides a detailed framework for companies aiming to stand up an employee hardship fund. In addition to granular guidance drawn from our experience, the playbook highlights four key principles that companies should keep in mind when looking to launch a successful relief initiative for their people:

Design a process that works for your employees.

The way you set up the application process and disbursement of grants will largely depend on the demographic you’re serving. For example, if your core is Gen-Z hourly retail employees, you’ll need to design your intake process to be mobile first. For an older employee or retiree base, a call center may be the first point of contact. If your employees largely use pay cards instead of direct deposit, build your grant distribution processes around that.

Use existing company resources and infrastructure where possible.

Given the urgency of the current moment, look at your existing infrastructure to see where you can leverage staff, technology, or processes that are already in place. We know many employees are looking for ways to give back during this critical time. Skilled volunteers can help lower costs when it comes to things like web design or database management.

Be responsive and needs driven.

Given the rapid deployment required at this moment, your processes and guidelines may not be perfect from the beginning. Give yourself wide guardrails. Listen to what your people are telling you they need, and adapt as best you can. It’s most important to take care of the employee first and optimize the process later. For example, unexpected expenses or loss of income due to childcare needs were not initially covered by RTF until schools across the world started to shut down in response to the Covid-19 pandemic. We’ve since changed our guidelines to fit the new reality.

Put empathy first.

It’s critical to recognize that employees who are reaching out for assistance are usually doing so from a place of stress, uncertainty, and anxiety. For many, asking for help is difficult and can be accompanied by feelings of shame. No one wants to think of themselves as needing charity; for that reason it’s important to position assistance as a critical resource available to anybody in your company community should they hit a rough patch. Anyone who is interacting with applicants must keep this distinction top of mind and put respect and dignity at the core of their approach.

We’re hoping that our experience can benefit other companies - and by extension, their employees - especially as we all continue to navigate this current situation. I can think of no better way to honor the original inspiration behind the Red Tab Foundation and to show our commitment to employees everywhere, particularly when it’s needed most.

Jenny Calvert Rodriguez is the Executive Director of The Red Tab Foundation at Levi Strauss & Co.