The hidden tax on women that's costing companies millions

Leaning on Pam and Bonnie to manage office birthday parties and department card signings might seem easy.

They’re just so good at that kind of stuff, in the same way so many wives and mothers — and more broadly, women — have been expected to be for centuries.

“That kind of stuff” has a few names. Invisible labor, hidden work, or emotional labor. And research suggests it’s costing mid-sized Fortune 500 and S&P 500 companies almost $1 billion per year in lost production, profitability, employee churn costs, and discrimination lawsuits.

Invisible or emotional labor encompasses all the work critical to company culture and effective team operations but that isn’t valued strategically or tied to dollar amounts. As a result, it receives little or often zero recognition, reward, gratitude, or opportunity for career advancement. 

According to Syndio, a company specializing in pay transparency solutions, common examples of unpaid, non-promotable work include:

• Organizing team events and in-office parties
• Collecting money and sending cards or flowers to coworkers facing illness or personal loss
• Remembering birthdays and anniversaries
• Office “housework” like setting up birthday parties, tidying up conference rooms, making coffee
• Leading and serving in employee resource groups
• Welcoming and mentoring new hires

Emotional labor at work isn’t just a fairness or culture issue. It directly affects profitability, productivity, and employee retention.

Employee attrition and disengagement — including absenteeism, lost output, and slow backfill  — costs median-sized S&P 500 companies about $282 million annually, according to research published in 2023 by the consulting giant McKinsey & Company.

Annual losses for Fortune 500 companies include:

1. About $1 billion in stress-related health costs. 
2. About $700 million in disengagement and loyalty loss.
3. About $67 million in legal and reputation costs.
4. About $42.5 million in employee turnover costs.

Invisible or emotional labor is work that takes away from time spent on employees’ primary roles, which are often directly tied to earnings. And there’s little to no compensation for or even acknowledgment of the work being done. It’s thankless and unrewarding, and correlates strongly with women’s common experience in heterosexual marriage where the same dynamic plays out domestically and contributes to about 70% of divorce filings being initiated by women. Domestic labor inequality is consistently cited as one of the top reasons why.

“Our society views women’s time as infinite like sand whereas we guard men’s time as if it’s finite like diamonds. Nowhere is this more obvious than the workplace,” Eve Rodsky, author of the book Fair Play, said in an interview. “We have always known that when women enter male professions salaries come down and that women aren’t paid equally for equal work. But what hasn’t been addressed is the deeply invisible problem of women being punished for opting out of the emotional labor of the workplace.”

This’s because women are expected to serve as caregivers and perform office housework, according to a Syndio report titled Invisible Labor in the Workplace.

“If they refuse to perform work like tidying up after colleagues, they face penalties such as receiving worse performance evaluations, getting fewer recommendations for promotions, and being considered less likable by coworkers,” the Syndio report said. “Even more unfairly, the opposite is true for men in the workplace. Men do less office housework than women, but when they do perform these chores, they have a higher likelihood of being recommended for promotions, raises, and bonuses. Men are rewarded for this work because they are seen as behaving altruistically by going ‘above and beyond’ what is expected of them, whereas women doing this work are just doing the baseline of what is expected of them.”

It's not that some men aren’t also doing this work. Several are. Also, women in the C-suite or other management roles sometimes participate in the whole I-don’t-pay-attention-to-or-reward-employees-performing-these-tasks thing.

Negative outcomes from invisible labor in the workplace disproportionately impact women. In mixed-sex groups, women receive 44% more requests to volunteer for non-promotable tasks than men, according to a study by Harvard Business Review. These women say yes 76% of the time compared to 51% for men.

“At the [Fair Play Policy Institute] we have been conducting interviews with women from many sectors of the American workplace and we are finding that post Covid, women continuously are asked and are tasked with non-promotable tasks and have to work harder for their employees to respond and take them seriously,” Rodsky said. “One woman told me her direct reports don’t respond to her like her male counterparts and she is tasked with polite follow up over and over.”

In a global survey of CEOs and CFOs conducted by Columbia Business School, more than 90% said culture is important at their organizations. And 92% said improving corporate culture would improve the overall value of the company.

Most companies claim to value culture, but don’t value or recognize it in practice, as only 25% of employers formally recognize this work in performance evaluations, according to the 2021 Women in Workplace Report.

How some companies are combatting emotional labor inequality

Some large and mid-size firms are building infrastructure through policy, benefits, and formal tracking to make the invisible visible.

Efforts include: 

• Embedding emotional/invisible labor into job descriptions and performance metrics
• Rolling out new parental leave policies (including supporting and normalizing men taking time off to support mothers and integrate new babies into their families), menopause support, and in-office policies that normalize shared-care responsibilities in the workplace across genders
• Using surveys and internal metrics to track who is doing emotional labor, and ensuring equitable assignment and recognition
• Launching emotional intelligence training

Step one, experts say, is making the invisible visible.

“What does it mean when we say that we care about equity at work, but then we hand the party planning to the only woman or person of color on the team? We call it ‘collaboration,’ but is that what’s really happening?” said Regina Lark, author of Emotional Labor: Why a Woman’s Work is Never Done and What to Do About It. “The invisible work of keeping others around us feel happy and comfortable is called ‘emotional labor,’ and it is quietly baked into the modern workplace with the expectation that women and people of color will manage morale, smooth conflict, and keep things running behind the scenes. It’s not just unfair; it’s bad business. 

“This invisible workload leads to burnout, absenteeism, and turnover — and worse, it keeps these individuals from doing the high-value, promotable work they were hired to do,” Lark said. “If we don’t name it, we can’t fix it.”