Netflix announced on August 4, 2015 that it would offer paid parental leave – all the time employees want, within the year following their happy event, to bond with their new born or newly adopted children – with pay. Should you be concerned? The answer is a qualified “No!”
Why “qualified?”
With regard to parental leave, Pew Research Center ranks the United States last among industrial nations. A study at McGill University lumps the U.S. with Papua New Guinea, Swaziland, Liberia, and Lesotho. The Organisation for Co-operation and Economic Development (OECD) reports extensively on the advantages enjoyed in other nations.
So, it is an embarrassing placement for businesses in the U.S. On the other hand, if you were to correlate the leave entitlement with GDP, quality of life, and productivity, the ranking would skew differently.
The corporate culture in the United States might well give additional thought to the role of how increased paid parental leave might play. But, that is a political and social issue not a business decision.
Having said that –
The Netflix decision may profoundly affect the world of businesses within which it competes. The 2,200 workers at Netflix account for only 2% of all workers in the very talent-competitive CATV world, but in that talent-jealous universe, almost anything goes.
Published reports do not indicate if the policy extends to non-exempt or part-time employees. And, employment does not extend to Netflix spawned income streams like original programming.
The governance of Netflix is well-paid and not very diverse, so the move to extend its benefits may seem self-serving. It has suffered its share of class-action compensation lawsuits in the past. But, in the Northern California climate, the move seems prudent and self-defining.
But, what does it mean to you?
The Netflix decision will raise the bar on discussions of employee benefits. But, it is not likely to affect the futures at businesses outside that Los Gatos, CA universe. It may threaten the Googles, Amazons, and Apples, but their enormous wealth allows them a lot of fat to absorb any negative impact.
- The smallest businesses struggle enough with providing mandatory and non-mandatory benefit as is. They best serve their employees by paying a livable wage and industry competitive benefits.
- Mid-sized companies find themselves under compliance demands as a result of their employee count and/or federal contractor status. They help their employees by meeting or exceeding the compliance expectations and by engaging workers in future growth.
- Larger companies face challenges to meet compliance mandates and compete for talent in their industry sectors. They improve employee satisfaction by besting compliance and economic standards. Depending on earnings goals, they have room to innovate and compete for talent.
- Global organizations have a lot of irons in the fire from the start. While they are “armed” to compete for talent with unbeatable benefits, they have cross-international and equity concerns to consider.
How does HRIS handle this “revolution”?
The tedious, demanding, and detail heavy tracking required of a manual system adds cost and inefficiency to the process. Netflix assuredly relies on external payroll and personnel processing. It does not even have an HR officer, and with their relatively small number of employees, any quality HRIS program can handle the complexity of unlimited vacation and parental leave policies.
But, for your business, you want to understand that HRIS is well past the age of spreadsheets and may offer you complex and redundant security in processing employment records to track and, thereby, encourage the introduction of more generous leave policies – even if you don’t want to complete with Netflix. Making your HRIS vendor a partner – instead of an operator –may offer options you and your employees have not considered.
Image from http://waworkandfamily.org/tag/summit-on-working-families/