Managing Labor Risks in Private Equity: Empowering Pension Fund Trustees to Navigate Workforce Risks and Drive Long-Term Value

The AFT created this report at the request of trustees from AFT members’ public pension plans, who seek information that is often hidden or not shared with them. During AFT Trustee Council meetings, trustees nationwide express the need to understand specific investment risks more thoroughly. This report’s purpose is to provide them with the necessary information to make informed decisions and fulfill their fiduciary duties.

This report argues that when private equity firms adopt and follow labor and workforce standards, everyone benefits: private equity firms, portfolio companies, their workers, our pension funds and the broader economy. The ideal outcome is for every private equity firm to implement responsible workforce labor standards and principles. These labor principles include promoting unionization, negotiating union contracts, ensuring workplace safety, eliminating forced labor (including child labor) and maintaining neutrality when workers unionize.