JUST Capital’s Initiative Is Giving Pay Pal Workers New Hope

Darya Tran is among the workers at PayPal who is benefitting from the company\’s participation in the … [+] Financial Wellness Initiative.

Darya Tran

After many years in which she couldn’t see more than a few weeks ahead, financially, Darya Tran finally has a future. She’s been working at Paypal

for more than 15 years, and thanks to the company’s new Financial Wellness Initiative—a program designed to ensure a living wage—she can now save $5,000 a year. That will add up to a nest egg of $80,000 by the time her two children leave for college. The program not only increases her income, but also lowers the cost of healthcare benefits, and makes her a shareholder. She is just one of thousands of PayPal workers who now feel more financially secure than ever before.

The Financial Wellness Initiative on a broader scale is a collaborative effort by JUST Capital, PayPal, the Financial Health Network, and Good Jobs Institute. (JUST Capital is best known for its annual list of the most just companies in America.) The program will directly impact 260,000 American workers in the list of participating companies announced last year: Chipotle, Chobani, Even, Prudential Financial

, Verizon and more.

This is only the start. JUST Capital will continue to recruit more and more participants in its effort to promote this cornerstone of stakeholder capitalism: the financial wellness of each and every worker. Research shows that improving workers’ financial well-being benefits workers themselves, but also improves business outcomes such as productivity, innovation, customer satisfaction, and employee turnover and engagement.


We desperately need companies to adopt these principles. Half of all American workers save less than 10 percent of their annual earnings, according to Bankrate.com. Millennials and Gen Xers are the mostly likely to say they can’t save money at all. Asked why, most explain that their income goes toward paying bills and debt, and that their job “isn’t good enough.”


What they mean is that their jobs don’t pay enough. Wages quit rising about four decades ago and have remained flat ever since. Meanwhile, profits have steadily grown, enriching shareholders. Then Covid-19 hit and the dust hasn’t yet settled.


Quarter after quarter, the mission of short-term shareholder primacy is to drive up profits as much and as quickly as possible. The easiest way to achieve those numbers has been to cut jobs and flatten wages. As a result, corporate profit margins are at an all-time high, even though wages have barely kept up with inflation. The buying power of median household income is less than 1% higher than it was in 1989. Wages have stayed flat, or have declined, since 1980. Since the 2008 financial crisis, 91% of income growth has gone to the top 1% of earners.

As a result, many households are sinking deeper and deeper into debt. Much of the population is staying afloat through deficit spending – to put food on the table and pay their bills, they must borrow money. To get by, they inch steadily closer to insolvency. The last few months have seen increased wage pressure at the lower end of the scale as large numbers of workers refused to go back to work at their previous wage. We’ll have to wait and see how that plays out going forward.

Taking a longer, historical view, back in 2017, Nicholas Eberstadt wrote for Commentary: “21st–century America has somehow managed to produce markedly more wealth for its wealth holders even as it provided markedly less work for its workers.” From the dawn of the new millennium, wealth continued to increase dramatically for the privileged few while economic output, wages, employment, and social welfare either stalled or declined for the vast majority. “Thus, the bittersweet reality of life for Americans in the early 21st century: Even though the American economy still remains the world’s unrivaled engine of wealth generation, those outside the bubble may have less of a shot at the American Dream than has been the case for decades, maybe generations—possibly even since the Great Depression.”

JUST Capital and its partners hope to completely reverse this decline. Companies joining the Worker Financial Wellness Initiative commit to conducting a financial wellness assessment of their workforce to understand workers’ financial vulnerability and find ways to shore up their financial resilience. Companies complete at least one assessment within a 12-month period, such as an employer-provided benefits assessment, an employee survey, or a living wage assessment. The goal is to make corporate leaders aware of workers’ financial wellbeing.

Dan Schulman, Paypal CEO, said major recent investments in worker wellbeing were driven by internal research at PayPal initiated after he learned that two-thirds of American households live paycheck-to-paycheck with very little discretionary income for savings or investments. His description of how PayPal restructured its compensation is heartening:

“We did a study of all our workers, our entry level workers (and) . . . about 60 percent (were) struggling to make ends meet every month. We looked at their net disposable income . . . what they (had) after transportation, rent, medical expense, childcare . . . people (were) living at the edge. We had to raise basic wages. We cut the (employee’s) cost of benefits by 58 percent for that portion of the population. We made every single employee a shareholder (with a) one-time equity grant and made all of them eligible for equity going forward. Our success as a company should be shared. We want our employees to do the right thing with every single interaction with the customer.”

This is a remarkable example of how a leader can do an unflinching inventory of how his own company operates, honestly face the reality of what’s happening, and then do what it takes to make it better. In a business world still largely driven by the principles of shareholder primacy, this takes courage and a commitment to the largest possible purpose: an equitable future for all Americans as the only reliable foundation for long-term economic growth.

In an interview last year on CNBC, Paul Tudor Jones, the founder of JUST Capital, explained that this sense of purpose is perfectly consistent with the profit motive. In companies that adopt stakeholder capitalism, profits inevitably go up to the point where their returns often lead their industry.

Jones said that multiple factors are converging—all driving dramatic growth in the economy—making it easier right now for companies to serve multiple stakeholder groups: customers, employees, communities, environment, and shareholders. The economy is poised for even more explosive growth as we emerge from the threat of Covid, a perfect time to embrace a different paradigm for corporation leadership.

PayPal employs more than 21,000 workers. To get some sense of the impact of its new compensation policies, imagine Darya Tran’s happiness and sense of well-being multiplied thousands of times over throughout the entire organization. And then add to that all the employees in the other participating companies.

And that’s just a taste of the prosperity JUST Capital hopes to build as the groundwork for America’s future. America’s CEOs need to get on board, assess whether or not their employees are financially secure, and then adopt policies similar to these at PayPal. It will be good for their firm’s future and for the future of American society as well.