Strategy

PayPal Withdraws Plan for Facility in North Carolina

The payments company says its decision was prompted by a new law in N.C. that discriminates against the LGBT community.
Katie Kuehner-HebertApril 5, 2016

PayPal is pulling the plug on the planned opening of a new global operations center in Charlotte, North Carolina, which would have employed more than 400 people. It is doing so because of the North Carolina General Assembly’s recent passage of a controversial “bathroom bill” that some say is targeted against lesbian, gay, bisexual, and transgender people.

The Public Facilities Privacy & Security Act, enacted March 23 in an emergency session, directs schools and public agencies within the state to ensure their bathrooms and changing facilities are restricted to “single sex,” meaning that people must use the facility that corresponds with their gender when they were born. The new law also prohibits schools and cities in the state from passing bathroom non-discrimination ordinances based on gender identity, similar to those already enacted by more than 200 cities and counties across the country.

In a post on the PayPal blog, president and chief executive Dan Schulman said the North Carolina law denies the LBGT community equal rights, one of the principles “at the core of PayPal’s mission and culture,” and as such, the San Jose-based company would not move forward with its planned expansion into Charlotte. PayPal had announced its plans to open the operations center only two weeks ago.

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“This decision reflects PayPal’s deepest values and our strong belief that every person has the right to be treated equally, and with dignity and respect,” Schulman said. “These principles of fairness, inclusion, and equality are at the heart of everything we seek to achieve and stand for as a company. And they compel us to take action to oppose discrimination.”

Schulman expressed regret that the company would not be able to “be a part of the Charlotte community” and employ 400 people there.

“While we will seek an alternative location for our operations center, we remain committed to working with the LGBT community in North Carolina to overturn this discriminatory legislation, alongside all those who are committed to equality,” Schulman said.

PayPal is known to be a supporter of LGBT rights, according to CNNMoney. The company earned a 100% ranking on the Human Rights Campaign Foundation’s 2016 Corporate Equality Index, a national report on corporate policies related to LGBT workplace equality.

While more than 100 other companies have protested the new North Carolina law, PayPal is the first to announce that it has canceled plans to add jobs in the state.

PayPal Holdings’ shares dropped by 0.62% on Tuesday.