Texas exodus? Refi startup is the latest to offer employee relocation

September 28, 2021, 4:59 PM UTC

Texas’ anti-abortion law has been on the books for less than a month and already several lawsuits have been filed against providers. And that quick uptake is prompting companies big and small to take action, including footing the bill to relocate employees. 

Texas’ latest legal salvo against abortion in the state went into effect Sept. 1 and essentially bans abortions after six weeks of pregnancy—before most women even realize they are pregnant. The law, which does not carve out any exemptions for incest or rape, is set to be enforced by allowing private citizens to sue to gain cash judgements of up to $10,000 from anyone who performs an abortion or aids in terminating a pregnancy after six weeks. 

The Justice Department has sued in federal court to invalidate the law, but in the meantime, state residents—and their employers—are caught in the crossfire. And it’s not just big corporations who are having to find solutions. 

MotoRefi, a startup founded in 2017 focused on refinancing auto loans, currently has about 20% of its workforce, or approximately 75 employees, based out of Austin after opening an office there earlier this year. It’s aggressively hired in the area, but Kevin Bennett, co-founder and CEO of MotoRefi, says the new law is already making it harder to recruit and build a business in Texas

“We do not support this law, which fails to prioritize the health and wellbeing of our team members. Though the Governor of Texas explicitly said that this law would not impact the state’s business environment, we firmly disagree and believe this law not only makes Texas less attractive to many individuals and their families, but also makes Texas less attractive to many fast growing startups like ours,” Bennett said in a statement. 

To counter the potential effects of the law on its existing employees in Texas, half of which are women, MotoRefi announced Tuesday that it would help relocate employees who wish to move, as well as provide continued counseling support and resources to employees. Bennett tells Fortune that several employees already have indicated interest in relocating. 

MotoRefi is the latest to offer this solution for employees—Salesforce announced earlier this month that it would provide assistance to employees and their immediate families who wished to leave the state because of the abortion ban. Meanwhile PR firm Bospar offered to pay up to $10,000 to relocate six of its employees based in Texas. 

Apple, meanwhile, has said that it is monitoring the law and the legal challenges, noting its employee benefits cover expenses related to out-of-state travel for medical care such as abortions. Ridesharing companies Lyft and Uber pledged to cover drivers’ legal fees if they’re sued under the Texas law for driving women to abortion clinics, as that could be construed as aiding or abetting someone to obtain a now illegal abortion. 

Additionally, about 50 companies from around the country—including Box, Everlane, Patagonia, Stitch Fix, Twilio, and Zendesk—signed a statement released Sept. 21 opposing Texas’ new law, saying that “restricting access to comprehensive reproductive care, including abortion, threatens the health, independence, and economic stability of our workers and customers.”

But while some employers are protesting the law and making provisions for their workers, many companies aren’t yet ready to pull up stakes, including MotoRefi. “We are still committed to Texas, but we are watching to see how this law impacts both recruiting for our Texas office and the demand of team members who would like to relocate from Texas as a result of this law,” Bennett said, adding that the startup is going to listen closely to employees as the situation unfolds and respond accordingly.

That’s where most companies are at right now, discussions with employees and internal communications— or “phase one,” according to Anthony Johndrow, co-founder and CEO of Reputation Economy Advisors, a reputation-based management consultancy firm. Organziations are playing a “wait and see” game as legal challenges mount and the permanence of the legislation is still uncertain.

The question is whether or not employees will trigger “phase two,” which would involve not only companies taking a public stand against the law, but using their influence to push against them. And workers could be the key motivator there.

“Employees, especially those who work at companies driven by knowledge-workers, have learned how to organize and drive change within their companies based on social issues,” Johndrow said.

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