Leadership Strategy

A Conversation With Chip Bergh, CEO Of Levi Strauss & Co, On Paid Family Leave


Chip Bergh joined Levi Strauss & Company as president and CEO for three reasons: (1) One of America’s oldest, most iconic brands had lost its relevance, (2) He embraced the company’s “Profits through Principles” posture, and (3) The company was in trouble, not creating any shareholder value in over a decade (sales down, debt high, and brand weakened). That was 2011. (Source: Bergh’s foreword to Leading With Character by Jim Loehr)

He believed he could reinvigorate the brand, support and lead ever-strengthening humanitarian values and principles, and guide the company to sustained financial strength. It’s a decade later and, by all accounts, he’s done so, despite the financial hit from an unprecedented concurrence of ravaging global crises this past year.

I sat down last week (virtually) with the sharply articulate and comfortably affable Chip to discuss one of the many issues to which he is deeply committed: paid family leave.

EA: The US is the world’s only developed nation without paid family leave, looking more like a Dickens novel than a modern workplace.

CB: We’ve been advocating for a national paid leave policy; now President Biden has put something on the table. We’re based in San Francisco, one of the most competitive job markets in the country, and we recognized we needed to up our game regarding our overall employee value proposition. It started with paid parental leave in 2016 when we offered parents, including adoptive parents, eight weeks’ paid time off: a game changer. Then, late in 2019 we looked at paid family leave, recognizing the stress ON and challenges to the generation in today’s workforce: dealing with young children at home and with elderly parents. That’s a lot of pressure, so we decided to put paid family leave in place, right when the pandemic hit a year ago.

EA: You’ve said that not only does this position do right by your employees, it also makes good business sense. You stated, “Some of the most important investments we make are in the well-being of our employees.”

CB: Yeah, I totally subscribe to that. It’s all about wanting your people to come to work every day fully engaged and able to bring their best self to work. And if they can’t do that because of financial challenges or a sick child or parent at home, they’re not going to bring their best self to work. So this really is about investing back in our people, and I think it delivers an exceptional return on investment. When you consider turnover, especially if you’re losing really good talent, the cost of that turnover is extraordinarily high.

EA: Calculating cost of turnover is hard to do. Have you been able to tell your investors, look, before you question this, this is what it costs if we don’t do this?

CB: I’d give you the story I told in my recent op-ed about a member of our team whose son, diagnosed with a rare condition, needed treatment from a specialist in another area of the country. In the middle of all this, her husband got sick. She’s a great performer, a real talent, somebody we would have considered a loss. Faced with the choice between caring for family or going to work, she would have had to leave the workplace, but she didn’t have to make that choice.

EA: You would have lost talent and she’d have been one of the two million women who lost ground in the workplace.

CB: Exactly. Not only that, but we’d have to go into the marketplace to replace her, and that always costs money, not to mention the risk of a hiring mistake and the cost of the learning curve.

EA: What about Levi Strauss’ employee turnover rate? Is there a trend to support what you’re saying?

CB: Over the last couple of years our retention has been higher. Again, we’re in one of the country’s toughest job markets, and unless you’re a designer, with most of the skill sets we have within the company, folks can leave for other employers. Still, our turnover, especially at management level, is only mid-single digits, especially good in this workplace.                                                                                                   

EA: President Biden, in his first major speech to Congress and the nation, mentioned the American Family Plan relatively early, before other critical issues and initiatives. Did that signal a priority? Was that encouraging?

CB: Yes. He was laying out his case for what we need to do to make progress as a country, with the priority on family first. I’m encouraged we’re finally looking at federal legislation mandating paid family leave.

EA: Will we see that in our mortal lifetimes?

CB: That’s why I wrote the op-ed. It’s unfortunate that it has to be legislated. Smart business leaders should look at this as an investment in their people. Here, we didn’t respond to legislation; we put it in place because it was the right thing to do for our people and it was a good business proposition for the company. And, in its first year, it wound up costing only 10% of what we anticipated covering internally.

EA: With gratitude for your time and insights, I’ll end with this question: With what new programs and initiatives – perhaps that you’re getting ready to announce – will you keep setting the pace?

CB: Well, I don’t want to get too far out in front of my skis, but I will say that as a company, we’ve never been afraid to be at the forefront. We like to say that when we lead, others follow. And this company has a long legacy of doing the right thing. Many key decisions we’ve made have been on the right side of history. In hindsight, I think history will show we’re on the right side of paid family leave.



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