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Latest News - May 2015

May 13, 2015
Facebook boosts minimum wage for contract workers to $15 an hour
Source: CNET.COM
By: Don Reisinger

The world's largest social network has launched a new initiative that will require the companies it works with to provide a higher level of pay and benefits.

The initiative, which began on May 1 but wasn't announced until Tuesday, will require that Facebook's contractors pay employees a $15 hourly minimum wage, offer 15 paid days off, and for workers who don't receive paid parental leave, $4,000 for new child benefits to new parents. A Facebook spokeswoman told the Wall Street Journal that she couldn't estimate how many workers would be impacted by the change. However, she said it would cover food-service, security and janitorial workers, among others, at its U.S. facilities.

Initially, the requirement will be placed on US companies that provide contract services to Facebook and have more than 25 employees supporting the Facebook account. Facebook COO Sheryl Sandberg, who announced the move on Tuesday, said that the new standards are in place for companies that support the social network at its headquarters in Menlo Park Calif., but will be rolled out to other areas later this year.

Facebook's decision comes amid growing concern across the US over fair pay and benefits to low-income wage earners. A growing discrepancy has developed between those who make substantial salaries and those on minimum wage, and the US government has said that such a discrepancy has created issues where Americans must choose between supporting their families and actually spending quality time with them.

US Labor Secretary Thomas Perez said in March that the US is "way behind the rest of the world" when it comes to balancing work and family life, adding that just 12 percent of private sector workers in the US receive paid sick days.

President Obama has also launched an initiative to provide parental leave to workers. The White House has cited a US Department of Labor study that shows a whopping two-thirds of people who are considered "low-income wage earners" have no sick days.

Facebook's decision follows a similar move by Microsoft in March. The technology giant announced its own program requiring its contractors to offer a minimum of 15 days off annually. Microsoft is placing the requirements on contractors with 50 or more employees who provide substantial work for the software company.

"The lack of paid time off disproportionately impacts low-wage earners," the software company wrote in a blog post in March. "While estimates vary, the overall trend is clear. As one study found, only 49 percent of those in the bottom fourth of earners get paid time off, compared with almost 90 percent among the top quarter of earners. Lack of paid time off also has a disproportionate impact on minorities at a time when the tech sector needs to do a better job of promoting diversity."

Sandberg echoed that sentiment in the Facebook announcement. She noted that women make up "about two-thirds of minimum wage workers nationally," making them "particularly affected by wage adjustments." Facebook's efforts, she said, should help both women and men and take "an important step for stronger families and healthier children."

US staffing companies employed an average of 3.2 million temporary and contract workers per week in 2014, up 5.4% from 2013, according to the American Staffing Association. The staffing industry hired 14.6 million people during all of 2014.

Facebook did not immediately respond to a request for comment.

 

 

 


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