Microsoft Will Only Work with Contractors That Offer Paid Parental Leave

Other companies may be inspired by Microsoft's move

Stephen Miller, CEBS By Stephen Miller, CEBS August 31, 2018
Microsoft Will Only Work with Contractors That Offer Paid Parental Leave

In a new policy announced Aug. 30, Microsoft said that its suppliers and contractors with more than 50 employees must offer employees a minimum of 12 weeks paid parental leave for either a birth or adoption, if they want to continuing doing business with the tech giant. The contractors will have to pay employees up to $1,000 per week during their leave.

Below is a roundup of resources and media reports with insights on this topic.

A Shared Commitment

The new policy requiring contractors to provide paid parental leave will be phased in over the next year, said Dev Stahlkopf, the company's corporate vice president and general counsel, in a blog post. "By implementing that requirement, we were able to focus our resources on businesses that share with us a commitment providing employees with important benefits such as paid time off. We believe now is the time to work with our suppliers to take a next important step."

He added, "We appreciate that this may ultimately result in increased costs for Microsoft, and we'll put a process in place for addressing these issues with our suppliers."

Tweet by Microsoft President Brad Smith

A Consistent Benefits Policy

Microsoft said it was inspired by a new Washington state law for paid parental leave that takes effect in 2020. The new law only applies to contract and suppliers' employees in that state.  Stahlkopf said the company wanted to expand the practice so it wouldn't "leave thousands of valued contributors outside of Washington behind."

The new policy also mirrors Microsoft's benefits for full-time employees. They get 12 weeks paid parental leave and birth mothers get an additional 8 weeks off. Three years ago, it required suppliers and contractors to offer 15 days of paid time off.

[SHRM members-only guide How to Develop and Administer Paid-Leave Programs]

A Trailblazing Move

It's common for tech firms to offer generous family leave benefits for their own software engineers and other full-time staff, but paid leave advocates say it's still rare to require similar benefits for contracted workers such as janitors, landscapers, cafeteria crews and software consultants.

"Given its size and its reach, this is a unique and hopefully trailblazing offering," said Vicki Shabo, vice president at the National Partnership for Women and Families.
(ABC News)

Is Paid Parental Leave Right for Your Company?

Tech companies tend to have the most generous policies for working parents. Facing an acute skills shortage, tech businesses are leveraging the benefit to attract and retain top talent. A competitive labor market may prompt more organizations to adopt robust paid-parental-leave policies in order to attract needed workers. But companies should determine if it's a good investment, and they can start by answering some basic questions about talent strategy and culture.
(HR Magazine)



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