Tech giant Microsoft announced a new policy on Thursday (Aug 30) that requires its suppliers and contractors to reinforce their parental leave policy if they want to work with the company, CNN reports.
Microsoft demands the companies with more than 50 employees will have to offer employees a minimum of 12 weeks of paid parental leave, for either a birth or adoption. The contractors will also need to pay employees up to $1,000 per week during their leave. Inspired by a new Washington state law regarding paid parental leave that is set to implement in 2020, Microsoft’s new policy will be phased in over the next year.
Announcing the policy in a blog post, Microsoft’s corporate VP and general counsel Dev Stahlkopf said, “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.”
Further, the new law will only apply to contract and suppliers’ employees in Washington, so Stahlkopf said the company wanted to expand it so it wouldn’t “leave thousands of valued contributors outside of Washington behind.”
Meanwhile, Microsoft acknowledged that the policy might increase costs as many will be affected by the new move. The type of suppliers and contractors impacted could include people who staff Microsoft’s cafeterias, its landscapers and IT jobs.
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.
Paid time off and parental leave is considered as a major issue for Microsoft.
“Studies show that paid parental leave enriches the lives of families,” Stahlkopf said. “Women who take paid maternity leave are more likely to be in the workforce a year later and earn more than mothers who do not receive paid time off.”