Roe v. Wade's demise forces companies to grapple with health care plans, employee privacy and more
The Supreme Court decision will have far-reaching implications in the corporate world.
In the immediate term, companies will have to decide whether to cover abortion and travel to other states for employees who live in a place where abortion is banned.
Abortion laws triggered by the reversal of Roe v. Wade may also influence where companies open offices, which lawmakers and political action committees they donate to and how they communicate with employees, customers and investors.
Pro-choice activists are seen outside of the US Supreme Court in Washington, DC on June 15, 2022.
Mandel Ngan | AFP | Getty Images
The challenges posed by the end of Roe v. Wade are only just beginning for corporate America.
By overturning the abortion precedent Friday, the U.S. Supreme Court set off a series of fresh difficulties for companies that must now navigate a country divided between states that will permit the procedure and others that will outlaw it.
One of those issues for companies is deciding if — and how — to provide abortion access to millions of employees who live in states where the procedures are no longer legal.
“Every major organization has health coverage,” said Maurice Schweitzer, a professor for the Wharton School of Business at the University of Pennsylvania. “The question is going to be what’s covered? Is travel for an abortion out of state covered if you’re operating in a state that prohibits abortion?”
Some of the country’s large employers, including Apple, CVS Health, and Disney, reiterated that the companies cover travel to states that allow abortions. Others, such as Dick’s Sporting Goods, rushed to update their medical benefits. Several prominent business leaders went a step further, condemning the end of 50 years of federal abortion rights.
Still many others declined to comment or said they are still reviewing plans.
The Supreme Court decision will have implications in the corporate world that stretch far beyond employers’ health benefits and influence where companies locate headquarters and offices, which lawmakers and political action committees they donate to and how they communicate with employees, customers and investors.
Over the years, certain companies have chosen to take a stand on polarizing issues, including the Black Lives Matter movement after the murder of George Floyd, a Black man, by a police officer and Florida’s HB 1557 law, dubbed the “Don’t Say Gay” bill.
The Supreme Court decision will likely force companies’ hand and make it hard for business leaders to stay silent, Schweitzer said. With those decisions, he said, companies could risk a lawsuit, run afoul of politicians and draw backlash from customers or employees.
“This is going to be an additional challenge for executives,” he said.
For companies that decide to cover abortion care in other states, it will raise new questions including how to reimburse travel expenses and protect employee privacy.
Expanding employee benefits
Some companies such as Netflix, Microsoft and Google’s parent company Alphabet already have health care policies that include abortion and travel benefits, but others are catching up.
JPMorgan Chase told employees in a memo that it will expand its medical benefits to include travel coverage starting in July. Under Armour said it will add a travel benefit to its medical plans. Dick’s CEO, Lauren Hobart, shared on LinkedIn that employees, their spouses and dependents will get up to $4,000 in travel reimbursement if they live in an area that restricts access.
Warner Bros. Discovery also reached out to its employees after the ruling was announced Friday.
“We recognize that the issue of abortion can evoke a variety of emotions and responses which are different for each of us based on our experiences and beliefs,” Adria Alpert Romm, chief people and culture officer, wrote in a memo to employees obtained by CNBC. “We are here to support you.”
Romm said the company is expanding its health care benefits to include expenses for employees and their covered family who need to travel to access a range of medical procedures, including care for abortions, family planning and reproductive health.
Amazon and other companies added travel reimbursement earlier this year as state governments in the Sunbelt passed laws that shuttered abortion clinics or limited access in other ways.
But how companies react over time will vary and could include removing abortion coverage from health plans, or offering indirect assistance such as paid time off or contributions to a health savings account that could be used for travel-related expenses to receive care in another state.
Nearly 30% of organizations said they would increase support within an employee assistance program for reproductive care in a post-Roe world, according to a survey of more than 1,000 human resources professionals for the Society for Human Resource Management. The survey was conducted from May 24 to June 7.
About a third cited paid time off as the top resource provided to support reproductive care, and 14% said they would include the topic of reproductive rights in their diversity, equity and inclusion programs.
Nearly a quarter of organizations said that offering a health savings account to cover travel for reproductive care in another state will enhance their ability to compete for talent.
Businesses taking a stand
Even before the Supreme Court decision, companies were under pressure to step into the abortion debate — or at least articulate how abortion limits and bans could affect their businesses.
Companies have long used their economic power to influence political policy. In 2019, when Georgia legislators sought to ban almost all abortions, Hollywood used the threat of production boycotts in the state to make clear its opinions about politics.
Still, in the wake of the pandemic, studios have been slower to react to new laws that traditionally they might have opposed. Production shutdowns are no longer a luxury the Hollywood can afford, especially as it seeks to keep up with demand for new content.
Disney is coming off a recent battle over a hot-button cultural issue. The company publicly opposed Florida’s so-called “Don’t Say Gay” bill, after its employees demanded the company take action. Florida Gov. Ron DeSantis Florida’s Republican-led legislature revoked the company’s special district in the state, which is home to Walt Disney World and other resorts, in a move it said was not retaliatory.
In a memo to employees Friday, Disney said it “remains committed to removing barriers and providing comprehensive access to quality and affordable care for all” employees. Disney, which already has pre-existing travel benefits that allow its employees who are unable to access care in their current location to seek out medical care for cancer treatments, transplants, rare disease treatment and family planning, which includes pregnancy-related decisions.
As individual states decide whether to maintain abortion rights or block them, legislatures may be faced with backlash from companies and influential business leaders. This could include boycotts, a loss of political donations or inform decisions about where to place headquarters, distribution centers or new facilities.
“Overturning Roe v Wade is a devastating decision by the U.S. Supreme Court,” billionaire and business mogul Richard Branson wrote in a statement. “This will not reduce abortions, it will just make them unsafe. Reproductive rights are human rights. We must all stand up for choice.”
Branson was among the companies and business leaders who slammed Supreme Court’s decision.
“This ruling puts women’s health in jeopardy, denies them their human rights, and threatens to dismantle the progress we’ve made toward gender equality in the workplaces since Roe,” said Jeremy Stoppelman, co-founder and CEO of Yelp. “Business leaders must step up to support the health and safety of their employees by speaking out against the wave of abortion bans that will be triggered as a result of this decision, and call on Congress to codify Roe into law.”
Investors in publicly held companies could have a major influence on how responses to the new ruling are crafted.
At a Walmart shareholders meeting earlier this month, an investor called on the country’s largest private employer to publish a report on the potential risks and costs to the company of state policies that restrict reproductive health care, and any plans the company has to mitigate those risks. The proposal, which is nonbinding, was opposed by the retailer and did not receive support from the majority of shareholders.
Similar proposals could come up at other companies’ shareholder meetings in the near future. Analysts could also probe executives during upcoming earnings calls.
Walmart is based in Arkansas, a state that already has a law on the books to trigger a ban. The company declined to comment on Friday when asked if it will cover travel expenses to states that allow abortions. It already pays for travel to hospitals and medical centers for other kinds of medical procedures, such as spine surgery and certain heart procedures.
Wharton’s Schweitzer said employees and customers increasingly expect more from companies and want to join or spend money with those that mirror their values.
The corporate world has led the way in some cases, with companies turning Juneteeth into a company holiday before it became a federal one. Some companies, such as Unilever-owned Ben & Jerry’s and CEOs, such as Levi Strauss & Co.’s Chip Bergh have become known for speaking out.
“There’s been a growing trend for executives to become more involved, more engaged in social and political issues,” he said. “This is going to increase that trend where we’re going to see many executives speak out, many executives lead on this issue, and it’s going to normalize the idea that executives are part of the political process.”
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