On August 5, 2015, Netflix announced it would offer its employees one year of paid parental leave. The new policy allows parents to set their own schedules – taking leave as necessary – for the first year of their child’s life and gives them the option to return to work full or part-time. Netflix Chief Talent Officer, Tawni Cranz, stated:
The updated policy is intended to help the company retain valuable employees. We want employees to have the flexibility and confidence to balance the needs of their growing families without worrying about work or finances…We’ll just keep them normally, eliminating the headache of switching to state or disability pay.
Unfortunately, according to Sam Sanders, speaker of National Public Radio, not all employees at Netflix are eligible to participate in the new policy. The policy only applies to “salary streaming employees” and does not cover employees in Netflix’s distribution centers or customer service department, who typically are lower-paid. The policy leaves out approximately 400 to 500 Netflix employees. Shannon Murphy, a Netflix fan, stated:
It’s wrong for Netflix to create two classes of employees. Already, there’s a divide between higher income earners (especially in the tech industry) and low wage workers in terms of access to important benefits like parental leave.
Ms. Murphy started a petition urging Netflix to expand its new paid-leave policy to all of its employees. However, the petition was a few hundred signatures short of the 6,000-signature goal and has not inspired further change.
Despite the backlash, Netflix’s new paid leave policy has influenced a wave of similar changes throughout the corporate landscape. Following Netflix’s recent press announcement, Microsoft announced that, in addition to 8 weeks maternity leave, it would add 12 weeks parental leave to both parents. Shortly after, Adobe followed suit, announcing that it would double its paid maternity leave to 26 weeks and give 16 weeks of paternity leave.
Netflix, Mircrosoft and Adobe are all raising the standards for parental leave in the corporate world. However, small companies find these offers difficult to match. As a result, finding ways to keep their talented employees from seeking better benefit opportunities elsewhere is a challenge, making small companies less competitive.
Netflix’s year of paid parental leave is creating a demand for companies, large and small, to make changes that are more suitable and accommodating for employees with growing families and may well be a cornerstone for future business success. Companies still can thrive with policies that show they value their employees. In return, employees are more productive when they are not burdened by the stress of working and maintaining their finances while afforded the opportunity to bond with their children. However, the ultimate goal is to distribute these benefits to all employees, despite their income.
If you have questions regarding parental leave policies in your workplace, contact The Harman Firm, LLP.