I'd bet my money against Amazon following. Amazon already lags behind the rest of the industry in terms of benefits. Employee happiness isn't really one of their values. "Frugality" on the other hand, is.
Wow, and I was excited about 4 weeks of paternity leave at my company. Which I'm still excited about by the way, Microsoft just seems like they are going above and beyond.
I know some places let people take longer off, and Netflix essentially lets you take a year off. This amount of leave is insane to me. Even a month seems like so much I won't know how to use it. I mean after 2 weeks I was ready to go back to work, but the option to go work 2-4 days a week and then spend the rest of the time at home would be awesome.
Last place I had to take vacation and my wife does not get Maternity leave at all.... That on the other hand is terrible.
The problem is that most Americans are shocked by this. Almost all of Europe has 6-12 months? Canada has 12? So we act like it's crazy generous thing to have so much paternity leave. Good for MS & netflix. The sooner we have a wave of big tech following the trend the better.
I (working in the US) have a handful of friends that work in Germany and UK. The only "bad" thing about US employment is vacation and parental leave. As a male I don't see a need for 12 months but the fact that my wife get shit here (8 weeks of "sick leave" for having a child) is enough to constantly keep my ears open for opportunities in other countries.
We need to stop being surprised and should be saying "about time".
Speaking from personal experience, the difference in take-home pay between Canada and the US is enough to pay for private school, private health insurance, and savings for a year of maternity leave for each child easy. It's enormous.
Now, if you're talking about being altruistic to those who aren't lucky to be Software Engineers in Silicon Valley, fine. But speaking in economic terms, you're way better off in the US than any socialist country you've mentioned.
As someone who is about to have the first new addition to the family, the 8 weeks off is further complicated by state laws and company policy. Even though my wife's maternity leave is protected by law in CA, her company can force her to use up her accumulated PTO time before allowing her to use her maternity leave ( I am skipping a lot of the technical details here..., but it was complicated enough that we had to use a spread sheet to figure out which law applies at the time frame, and if and how she is compensated during this time)
"Wow, and I was excited about 4 weeks of paternity leave at my company. Which I'm still excited about by the way"
I realize this may be better than what you had, but the rest of the civilized world puts this number to shame. And it's not really going to change unless people get angry.
This matches the 401k match that Google has had for some time now.
I would love to see this become a standard benefit in the tech industry. Given that many tech workers are young, and young tech workers usually have high salaries for their age (relative to other professions), 401k money is very, very valuable.
Google matches the greater of something like 100% of $3000 - or - 50% of the max employee contribution.
A 100% match from Microsoft would mean an annual 2015 contribution of $36,000 ($18,000 employee + $18,000 employer match) versus $27,000 maximum ($18,000 employee + $9,000 employer match) from Google. That's a $9000 difference.
EDIT: Looks like the article is incorrect. Correct numbers are 50%, as stated in parent comment.
No. They are increasing from 50% of 6% to 50% of all deferrals. So the maximum before was like $540 if you put in $18,000. Now its $9000.
"Retirement readiness is an important part of overall financial wellness, so beginning Jan. 1, 2016, we’ll increase the company’s 401(k) match from 50 percent of the first 6 percent that employees defer, to 50 percent of all regular deferrals."
I don't think that's plausible. More likely the match was 50% of the first 6% of salary employees deferred. That would require an employee to earn $300,000 in order to see a maximum $9,000 match. Now an employee can receive the full match merely by deferring the maximum amount, regardless of their salary.
6% refers to 6% of salary, not 6% of deferrals. 401k contributions are measured in terms of percentage of pre-tax salary contributed, and the match is based on that.
Under the old scheme, you had to contribute at least 6% of your pre-tax salary to get the maximum match, which was 50% of whatever that value was. In other words, the maximum match was 3% of your salary, and you had to be contributing at least 6% of your salary to get that. Now, anything you contribute gets matched at 50%, regardless of what your salary is.
You are correct. The article incorrectly quoted the source:
"we’ll increase the company’s 401(k) match from 50 percent of the first 6 percent that employees defer, to 50 percent of all regular deferrals. With the current IRS regular deferral limit of $18,000, this means employees will have the opportunity for Microsoft to match their contributions up to $9,000 per year."
Nobody knows. Microsoft's own release makes no sense. You (and your employer, combined) cannot contribute more than $18,000 tax-free per year. It's either 100% match of $9,000 on your $9,000 to make $18,000, or it's 50% match of your $12,000 to make $18,000. It can't be both things that the press release says it is.
My best guess is that they meant to say they now match 100%, but we won't know for sure until they correct the press release.
Actually, employer contributions do not count towards the $18k maximum per year in contributions. This is the specific advantage of having a 401k match in the first place, as it allows employees to have more tax deferred savings than otherwise possible.
You're incorrect. Employers are allowed to contribute to an employee's 401K plan up to a $53,000 combined limit. The $18K limit applies only to employee contributions.
Unrelated, but Wall Street parasite fees do count towards your contribution limit. And 401k plans mostly offer high fee funds. So be careful or you might think you're contributing $18k but you're actually only contributing $17k and making an annual $1k gift to some some banker's bonus. Also, 401k is a massive Wall Street scam.
It's worth what it's worth. Salaries are high enough that it's not hard to contribute the max. I'd LOVE to have a 401k match, because I'm already maxed out. 100% match would be $9,000 per year straight into my pocket. (Well, minus taxes, I suppose, since that particular $9,000 would now be taxed).
As someone who is employed by a company of <10 and had to take 1 of 2 weeks vacation for the my kid's birth, I wish I had this kind of benefit, but then if I did, I'd have to deal with all of the negative parts of working for a big company. It's a trade-off, and here in the hinterlands where there isn't VC funding to be had for every app idea or billions behind the company already, we end up with what we can. I'm happier in my small company 8-5 with almost no extra time than I would be working for a big company 7-7 with regular demands for time put in outside of the office.
Benefits are all well and good, I'd just prefer the large tech employers work to employ more people rather than provide more to those that already have jobs. When these people are out on mat leave are they to be replaced by perma-temps on zero-hour contracts?
There is also something to be said for pay over benefits. Pay is of equal value to all employees. Benefits like leave and 401ks are only valuable to some and can, if dominant over pay, lead to employers having undue influence over the lives of employees.
Any good manager scopes the amount of work to the number of people available. I work at a large tech company. I have a coworker who was on extended medical leave for the last year. During that year we shipped a new release of our product. I can absolutely tell you that there are areas of the product where we could have made additional improvements and had higher quality if that coworker was with us - but even without him, we still shipped, because we scheduled our workload knowing he wouldn't be there for that time.
>Pay is of equal value to all employees. Benefits like leave and 401ks are only valuable to some
Well, no. In general, pay and leave are not 1:1 exchangeable if, indeed, they're exchangeable at all. At most companies, an employee can't just say "I'll trade 2 weeks pay for 2 weeks vacation." And, indeed, at some level an employee has to be worth more per day than they are actually paid.
(I'm talking leave generically here. I've no interest in getting into a debate over parental leave specifically which of course applies under certain specific situations.)
As for 401-K contributions, this gets into tax law and the fact that employer contributions (subject to various limits) are deductible in the US. In general, a lot of decisions related to benefits are very much driven by cost to employer (after taxes) and perceived benefit to typical employee (after taxes).
This is so extremely weird for me. I'm currently on parental leave in Canada, for the next 17 weeks, paid. You get 50 weeks of leave here to split between mom & dad. It seems so ridiculous these articles saying that it'll be hard for the company to deal with the loss of the employee for that long. Hire someone for a 1 year term... done. There's really no excuse when so many other countries have been doing it for so long.
That is an extremely weird idea for me. How can that possibly make financial sense for the employer, in the 21st century? I can see it working out a couple generations ago when people used to stick with one or two jobs for their entire career, but seriously, I've had three jobs in my career that barely lasted more than 50 weeks start to finish, and in only one case - a job I had for seven years - does it seem at all likely that the company could have amortized out the cost of a year-long vacation and still come out ahead.
Amortized across an entire society, sure, it could work, but unless I'm totally misunderstanding the way Canada's system is set up, it seems like it's really bad luck for whichever employer gets stuck with the hot potato when someone decides to have a kid.
Interesting. The way to go as a parent then is to to live somewhere cheap away from the city where 524 a week goes further, and make sure you have a job just before giving birth.
Not countering your point (since it speaks to the loss of an employee for time), but a primary difference between Canada and the US is who pays. I think that is a point many articles fail to mention when comparing, and they put too much focus on the loss of time.
In Canada the parental leave money comes from the government. For Microsoft and in the US, the company is paying 100% of it. If the government pulls the plug on this benefit in Canada, I predict you'd see significantly fewer parental benefits offered by the companies.
What if that 1-year term person has a child shortly after joining and takes their 50 weeks paid leave too. Then you'd need to hire a second 1-year term person... who could have a child and take leave. And another. And another. Stack overflow.
Now, I'm very much in favour of parental leave, especially something that allows paternal leave as wells as maternal leave. I think it has huge societal upside.
Having said that, it is naive to think this isn't a fairly large burden on a company -- especially for a software company. First, assume that the company is paying the benefit -- say 50% of salary. That's an expense. Then you have to hire a contractor for a year. The rule of thumb is that a contractor costs double. So you have the same overhead cost (same number of desks), but you are paying 250% of the salary (plus applicable taxes). Then consider the domain knowledge that the worker on leave has. How long will it take for the contractor to get up to speed? So you have a loss of productivity. And the hiring process itself isn't cheap. In the end with all of the costs, you will probably be paying up to 3 times the original salary for the person on leave.
I leave this for the end because I know it is a potential sore point with many people given typical gender based roles. Without wanting to get into that discussion, there is always the chance that the person who goes on parental leave (whoever it might be) will decide not to return to their former career. A year of child care is a long time and many people (for many good reasons, IMHO) decide that this should be their new career. So a company, having paid nearly 3 times the employees salary in costs and lost productivity, may end up simply losing that employee anyway.
It is hard for the company to deal with -- especially small companies that don't have a lot of excess money/time to afford the expense. Again, I'm not saying it shouldn't be the norm, but closing your eyes to the very real hardships of the company in this case will not help it expand.
Shouldn't this be considered the cost of doing business? Here in Australia we have mandatory employer retirement contributions of 9.5%. I'm sure small business would love not having to pay this, but that is the cost of employment.
A burden is a burden, whether expected or not. The OP was opining that there was no burden because you can just hire a contractor for a year.
Also, unlike pension contributions (here Japan we have to pay 7% pension and 7% health insurance!), parental leave costs are not applicable to all employees; just ones that are going to have babies. So if you have 10 employees and one of them goes on parental leave, suddenly your costs have gone up 20%. As much as this is "the cost of doing business", it's pretty hard to plan for that when you don't know the procreational schedule of your employees. Do you keep a float of capital "just in case"? Heaven help you if 2 people go on parental leave at the same time! How many start ups are going to budget for babies rather than spend that money trying to expand growth? I'm not saying it's impossible, but it is far from easy.
Even worse, in countries where there is no paternal leave, this means it is a cost/risk that applies only to young women employees. I hope it goes without saying that this creates a terribly uneven playing field for women in industry.
Like I said, I'm a staunch advocate of parental leave, but I don't think it is an easy situation for anyone.
You're absolutely correct that this is not a simple situation to solve. Unfortunately the US goes into collective anaphylactic shock when words like socialized <insert anything here> is mentioned.
Ideally the state pays for this through taxation or via levy against large corporations. This way everyone has access, even those not fortunate enough to work at Microsoft.
I've always viewed benefits like this as a way for the company to incentivize and/or reward certain behavior from employees. Offering a 401(k) match is a way to encourage employees to save for retirement.
By that logic, offering parental benefits is a way to encourage people to have babies. That's always seemed a bit weird to me because it seems inappropriate for a company to be involved in something so personal. It seems reasonable for the government to say, "we want more people to have kids for the greater good" but it seems strange for companies to take it upon themselves to do that.
I'm not saying new parents shouldn't be able to take time off, but it seems like people who choose not to have kids should receive similar benefits. Maybe companies should offer sabbaticals to everyone, and if some people choose to use that to take time off after having kids, then that's fine. But if someone isn't interested in having kids and instead wants to spend three months pursuing a hobby, that seems equally valid to me.
I think it's more that they're incentivizing potential new hires that value having a family to come work for the company.
Existing employees are going to have a baby either way, in the grand scheme of things a few months aren't going to change your mind about having a child. On the other hand, all things being equal, working for Microsoft vs working for another big corp, having more time off for your kids could tip the scales in Microsoft's favor.
At the risk of being cynical, you're probably right. It's a benefit that's relevant (or potentially relevant) to many young new hires who might otherwise be somewhat skeptical of going to work for Microsoft.
I guess the difference, as you can see from the threads here, is that many people seem to think that extended paid parental leave is something that civilized governments are obligated to deliver (through employers). This is a fairly modern notion. Sabbaticals, not so much. I'm not sure many people are really viewing this through the lens of incentives though.
I actually agree that, from a rationalist perspective, offering everyone periodic sabbaticals with a lot of scheduling flexibility is a nice thought. (Not quite the same thing--but I've always thought Intel's sabbaticals were a nice practice.)
- I seriously doubt this leave will have any bearing whatsoever on whether an employee decides to have kids. It is such a major, life changing and personal decision it is taken irrespective of incentives. Only serious constraints (no money) might negatively impact that decision. As a new parent, I was very happy to get leave from my company but I would have had kids regardless. Also I never heard of anyone having kids so they could get the 12 weeks or whatever or leave :)
- Another way to look at this is you have people that are having kids and people that are not. What can the company do to keep the former happily employed/interested in joining your company?
Yup, it seems like parent (as in parent comment, not human parent) has the causality wrong. This won't incentivize anyone to have kids. It will incentivize people to join or stay with the company if they plan on having kids in the future, though, and that's good for the bottom line.
It sounds bad for the company, due to adverse selection.
When I get to the stage in my life where I want this benefit, I'll shift over to MS or similar companies. I'll work there for a few years, take this benefit, and then shift back to a company that comps me with cash once I'm done having children.
It would be pretty silly if a 22 year old decided to work at MS for 15 years, simply to use this benefit for two children they bear at age 31 and 33.
Absolutely, I don't think that parental leave will impact someone's decision to have kids. However, giving a benefit to people who have kids without giving that same benefit to people without kids is not that different from the company saying that they want their employees to have kids. It won't actually change behavior, but it still stands out to me as a pretty opinionated stance from the employer about what behavior they want from their employees.
Parental leave is a good way to keep people with kids happy. Why shouldn't we also keep people without kids happy? Everyone deserves time to pursue passions outside of work. Some people are passionate about their families. Other people are passionate about other things. I think employers shouldn't have an opinion on which is more valid, and they should support both.
> However, giving a benefit to people who have kids without giving that same benefit to people without kids is not that different from the company saying that they want their employees to have kids.
/want/ their employees to have kids means that they desire it to some degree. I am sure MS doesn't desire it, but rather indifferent. But they do desire to be a more humanitarian company and want their employees to be happier.
> Why shouldn't we also keep people without kids happy? Everyone deserves time to pursue passions outside of work. Some people are passionate about their families.
Are you trying to say that because people with children have parental leave, people without children should have equivalent leaves too? That sounds a little ridiculous to me.
> Are you trying to say that because people with children have parental leave, people without children should have equivalent leaves too? That sounds a little ridiculous to me.
How so? They probably work harder (for the employer) than the ones with children but deserve less PTO?
An employer may offer free sushi and beer on Fridays. Does it mean they encourage fish and alcohol consumption? What about employees who don't consume either due to health or religious reasons, or just plain preference? Do they now deserve make-up compensation?
As a parent I never come in late and stay for dinner. This means the dinner service is an employer cost that I get no benefit from. Clearly the single people are the primary reason for this unnecessary cost to the company. I also don't drink soda and I'm not sure why my employer encourages this behavior by spending so much money on free soda everywhere. Lets nix that too!
Maybe you see what I'm getting at. The employer is just trying to accommodate and please people with various life choices for good retention and hiring rates. There's no reason that they absolutely shouldn't offer something to kid-free people only, it's just that they don't currently, probably because they don't think it will help much.
It might have a bearing on whether or not they want to work at MS and have kids. Too easy for engineers to just go over to another company. Policies like this give MS a leg up over the likes of Amazon.
I've always viewed benefits like this as a way for the company to incentivize and/or reward certain behavior from employees. Offering a 401(k) match is a way to encourage employees to save for retirement.
By that logic, offering family insurance benefits is a way to encourage people to have families. That's always seemed a bit weird to me because it seems inappropriate for a company to be involved in something so personal. It seems reasonable for the government to say, "we want more people to have families for the greater good" but it seems strange for companies to take it upon themselves to do that.
=======
Some things don't benefit you personally and are still good things.
You're being deliberately obtuse. They're being given a benefit that they have no intention of using which, at some level, is less personally valuable than a hypothetical alternative company-wide benefits package. Nothing against this plan personally but, like all benefit plans, it makes certain assumptions about typical preferences. (e.g. all other things being equal, a generic sabbatical plan that everyone could use would presumably be less generous than one applying only to a subset.)
No I'm not being obtuse, I am being very serious. Every employee is given the same benefits package, they can use it or not.
If someone elects not to use the 401k matching should they get the cash equviant? Your position is they should because they chose not to exercise the agreed upon package.
Or if someone gets into an accident and health insurance covers $100k of his medical bills, it's only fair that you, who was not in an accident, get $100k in cash because they got a benefit you didn't.
Every Microsoft employee gets the same benefits package. It is already fair. You personally may not hold parts of that package very important but that only influences how much weight that part of the compensation has when choosing other oportunities.
Also, Microsoft has a sabbatical policy, it's a separate thing. But you haven't let facts get in your way up until now, so why start.
I think that sounds backwards. People decide whether they want to have babies and seek out an employer whose environment works well with that life choice. So if you as an employer see parents as typically older (therefore more experienced) and more stable than non-parents, you would provide benefits that would be attractive to those people. I am not saying this is necessarily the case for parents vs non-parents, just that some employers might see things this way and act accordingly.
On another note, I don't think it's a good idea to pretend like this is simply another in an endless variety of choices people make about their lives that can be incented one way or the other. When people have kids it tends to alter the way they see the purpose of their whole life. It's not "oh sweet, I can get a tax credit if I buy a Prius".
As a fresh-out-of-college male who had no plans to start a family any time soon, I noticed a distinct quality-of-life change when my coworkers generally had families vs. when they didn't (there were some clear shifts in demographics shortly after I started my first job, arising from, essentially, chance). There was much less of a norm of being in the office past 6 or reachable in evenings/weekends, and much more of a norm of getting in at 10 (probably right after dropping off the kids for work). There was no desire to have work-provided dinner, because my coworkers wanted dinner with their families. There is probably also a less-tangible change, that people with families don't define their self-worth by their work quite as much. This trickled down into when meetings were scheduled, what expectations there were for last-minute work ahead of deadlines, whether the company did supposedly-informal events on evenings and weekends, etc., and as a result, it meant that my work-life balance was good.
I'm now skeptical of workplaces where everyone else is like me, with no family that wants them home by dinner. I don't actually think these policies will successfully incentivize anyone to start or not start families, but even if you wanted to be that cynical, there's a clear advantage in work-life balance for everyone to encourage a sizable fraction of your employees to have families. A sabbatical for single people wouldn't accomplish the same long-term effect. (I'd be specifically worried that the "hobby" would be good for the company, since I can see myself easily falling into that trap.)
That seems like a rather inefficient and convoluted way to incentivize employees without families to have a "better" work-life balance. You implied that the company was providing dinner - maybe it should start promoting a better work-life balance by not doing that.
You get the benefit of children in 30-40 years when you retire and those children pay your Social Security and Medicare (or whatever government programs might be equivalent wherever you are; and all this after decades of hard work by the parents), and you get the benefit of parental leave right now by not having to deal with sleep-deprived, angry zombies in your workspace. ;)
On balance, you're coming out ahead, not the new parents.
> I've always viewed benefits like this as a way for the company to incentivize and/or reward certain behavior from employees. Offering a 401(k) match is a way to encourage employees to save for retirement.
I'll accept that.
> By that logic, offering parental benefits is a way to encourage people to have babies.
This does not follow. You are assuming that if a company offers something that might incentivize people to do X it must be because the company wants to incentivize X. You are overlooking that it could be they want incentivize Y or disincentivize Z (so both) and this also happens to incentivize X for some people.
I don't think there are many people who would not otherwise have had children who will decide to go ahead and have a baby if their company offers better parental leave. There are probably many people, though, who have decided they want children, and might consider leaving their company for one with better parental leave policies, and so I think it is more likely that this is about keeping employees rather than influencing their reproductive behavior.
Why not? It's ridiculous the sense of entitlement parents have. You're not special because you figured out how your reproductive system works and you don't deserve special benefits.
Society feels differently, and Micorsoft here recognizes this and can use that to provide incentives to future hires and retain existing ones.
Secondly, raising kids is not a hobby, that's why they shouldn't be conflated.
And you can take your entitlement charge that you're about to level at me and shove it up your ass. I don't have kids, I won't have kids, I really kind of hate kids, but even I can see it's not a god damn hobby.
> "It's ridiculous the sense of entitlement parents have."
It's not a sense of entitlement that drives these kinds of changes. It's a recognition that child rearing is an important societal activity, and that in a modern, privileged, civilized society we should not have workplace policies in place that are hostile toward parents. Ageing populations are a real and present threat to many first world countries. In most western countries this is recognized at the governmental level with leave schemes, childcare subsidies etc.
This is also in response to changes in work patterns. In the 50s it was very uncommon for both mother and father to be working. Now the opposite is the case. Shouldn't society then move to restore the balance in a sense by applying what you call "special benefits" to parents?
The entitlement was evident in his footnote "please do not equate having a baby to pursuing a hobby."
I should have been more specific that parents should not be entitled to special benefits at work. It would make sense for a government program to subsidize child rearing to some extent.
> it seems like people who choose not to have kids should receive similar benefits
This always comes up when this topic is being discussed. I don't understand what it is about the American psyche that makes us get so worked up about someone else (often in demonstrable need) receiving some sort of help.
I realize I'm stretching a bit here, but your opinion lives in the same realm as some other doozies we often hear:
"Why do women get special tech recruiting events??? Nobody set up a special event to recruit ME. I had to network all on my own"
"Why should my tax dollars pay for a transit system I don't use???"
"Why should inner city schools get subsidized lunches? I had to bring mine every day!"
This is why we can't (and don't) have nice things.
I'm a child free person as well. I would really love to see tech companies offer short sabbatical periods. Knowing the people in the tech community, that time would almost certainly be put to good use: learning new skills, and finishing up backlogged personal projects.
Sabbatical could be a benefit that kicks in after several years, and any parental leave before that time would just be subtracted.
I think its a bit of selfish to look it as some form of vacation and it is not fair. I respect people for their choice of having and not having kids, but when you are responsible for another human being the context changes, life changes. I understand where you are coming from, but this will open a Pandora box, there is a difference between an employee who chose to have 3 children vs 1. So can the employee with only one maternity leave ask for something extra?
Good move, but I fear this will lead to inequality being further entrenched into the workforce. It appears as if the very skilled workers like the ones at Microsoft, Netflix etc are going to have great lives, and the lesser workers (who may not have such great jobs) will have shittier lives.
That's why the state stepping in is important, this needs to be the norm at a federal level. Otherwise we'll have the rich spend more time with their kids and raising healthier/smarter children, and the poor raising a class of slaves (low child IQ is connected to less parental involvement in early years) to serve the rich. That's not the American dream.
> Otherwise we'll have the rich spend more time with their kids
An interesting reversal of history, in a sense. For example Victorian England, where the rich were the ones with the means to "outsource" the raising of their kids, and often did so.
Children of the posher classes would often have a more intimate and parent-like relationship with their "nanny" (or "nurse" or another member of the household staff), than with their own parents. The childrens' lives and daily timetables were managed entirely by the staff, and they were wheeled into the company of the parents for various daily occasions such as meal-times (and a pat on the head before bed). Aside from this, they spent their time relegated to the nursery, or in classes, or on outings with the staff.
Nowadays, on the other hand, spending lots of time with the children is something that might be considered a luxury reserved for the financially secure (who aren't spending all their time taking busses to three jobs).
I suspect that any parental-like relationship (such as that between a nanny and child) is more beneficial for the child's development than say, being home alone or in a substandard daycare with disinterested and high-turnover employees.
I'm not sure why people find the 401k changes confusing, here is how it works:
The employee defers up to 18K (IRS limit), MSFT matches 50% of it, which is up to 9K.
Previously they contributed 50% of the first 6% the employee deferred = a maximum of 3% of the salary. So for anyone who makes less than 300K (9K / 0.03), this means a higher match from MSFT.
This is a really good move on Microsoft's part & affects about 60,000 people - so not an insignificant number.
What is sad and pathetic is that in the US people are actually shocked by how good this is!!
Everyone is programmed to go into "Oh but this will be a huge burden on the company" mode.
What about the fact that currently the US has some of the shittiest laws on the books when it comes to Time-off for new parents?
What about the burden on society when New Moms are forced into their workplace way too soon because of the crappy support from the govt.?
So companies do not have to bear this burden but the new moms & babies can bear the hardship easily?
Free enterprise does not mean a license to shirk some of the most basic responsibilities. We should be pushing our elected peeps to take stornger action on this
I wonder if Facebook will step up their 401k matching to meet or exceed this, particularly for their Seattle employees. I would ask the same for Amazon, but I seriously doubt anything will move their benefits needle much.
You have to be careful about this. At a previous employer I got a bunch of comp time for my new kid, but when I got back I had these sort of sucker tasks for me to do and I felt this odd kind of resentment towards me from some. So I started looking for a different job cause I felt no matter what I did I could never go back to how it had been. I was pretty depressed about it, it was really subtle, and I think some of my coworkers must have felt I went off the deep end there.
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[ 4.7 ms ] story [ 130 ms ] threadhttps://blogs.microsoft.com/blog/2015/08/05/the-employee-exp...
Just an opinion of a former Amazonian though.
I know some places let people take longer off, and Netflix essentially lets you take a year off. This amount of leave is insane to me. Even a month seems like so much I won't know how to use it. I mean after 2 weeks I was ready to go back to work, but the option to go work 2-4 days a week and then spend the rest of the time at home would be awesome.
Last place I had to take vacation and my wife does not get Maternity leave at all.... That on the other hand is terrible.
I (working in the US) have a handful of friends that work in Germany and UK. The only "bad" thing about US employment is vacation and parental leave. As a male I don't see a need for 12 months but the fact that my wife get shit here (8 weeks of "sick leave" for having a child) is enough to constantly keep my ears open for opportunities in other countries.
We need to stop being surprised and should be saying "about time".
Hear hear.
Is apparently the correct gramelling.
Speaking from personal experience, the difference in take-home pay between Canada and the US is enough to pay for private school, private health insurance, and savings for a year of maternity leave for each child easy. It's enormous.
Now, if you're talking about being altruistic to those who aren't lucky to be Software Engineers in Silicon Valley, fine. But speaking in economic terms, you're way better off in the US than any socialist country you've mentioned.
I realize this may be better than what you had, but the rest of the civilized world puts this number to shame. And it's not really going to change unless people get angry.
I would love to see this become a standard benefit in the tech industry. Given that many tech workers are young, and young tech workers usually have high salaries for their age (relative to other professions), 401k money is very, very valuable.
A 100% match from Microsoft would mean an annual 2015 contribution of $36,000 ($18,000 employee + $18,000 employer match) versus $27,000 maximum ($18,000 employee + $9,000 employer match) from Google. That's a $9000 difference.
EDIT: Looks like the article is incorrect. Correct numbers are 50%, as stated in parent comment.
"Retirement readiness is an important part of overall financial wellness, so beginning Jan. 1, 2016, we’ll increase the company’s 401(k) match from 50 percent of the first 6 percent that employees defer, to 50 percent of all regular deferrals."
Under the old scheme, you had to contribute at least 6% of your pre-tax salary to get the maximum match, which was 50% of whatever that value was. In other words, the maximum match was 3% of your salary, and you had to be contributing at least 6% of your salary to get that. Now, anything you contribute gets matched at 50%, regardless of what your salary is.
Pretend I made $100k, contributed $6k -- they matched an additional $3k into the account.
The match was considerably more than $540 @ $18k.
Source: I work there.
"we’ll increase the company’s 401(k) match from 50 percent of the first 6 percent that employees defer, to 50 percent of all regular deferrals. With the current IRS regular deferral limit of $18,000, this means employees will have the opportunity for Microsoft to match their contributions up to $9,000 per year."
https://blogs.microsoft.com/blog/2015/08/05/the-employee-exp...
My best guess is that they meant to say they now match 100%, but we won't know for sure until they correct the press release.
Source: http://www.bankrate.com/finance/retirement/employer-match-co... (Technically, with employer match, it can go up to $53k)
As someone who is employed by a company of <10 and had to take 1 of 2 weeks vacation for the my kid's birth, I wish I had this kind of benefit, but then if I did, I'd have to deal with all of the negative parts of working for a big company. It's a trade-off, and here in the hinterlands where there isn't VC funding to be had for every app idea or billions behind the company already, we end up with what we can. I'm happier in my small company 8-5 with almost no extra time than I would be working for a big company 7-7 with regular demands for time put in outside of the office.
There is also something to be said for pay over benefits. Pay is of equal value to all employees. Benefits like leave and 401ks are only valuable to some and can, if dominant over pay, lead to employers having undue influence over the lives of employees.
Well, no. In general, pay and leave are not 1:1 exchangeable if, indeed, they're exchangeable at all. At most companies, an employee can't just say "I'll trade 2 weeks pay for 2 weeks vacation." And, indeed, at some level an employee has to be worth more per day than they are actually paid.
(I'm talking leave generically here. I've no interest in getting into a debate over parental leave specifically which of course applies under certain specific situations.)
As for 401-K contributions, this gets into tax law and the fact that employer contributions (subject to various limits) are deductible in the US. In general, a lot of decisions related to benefits are very much driven by cost to employer (after taxes) and perceived benefit to typical employee (after taxes).
Amortized across an entire society, sure, it could work, but unless I'm totally misunderstanding the way Canada's system is set up, it seems like it's really bad luck for whichever employer gets stuck with the hot potato when someone decides to have a kid.
This Microsoft/Netflix way of doing it themselves is silly.
In Canada the parental leave money comes from the government. For Microsoft and in the US, the company is paying 100% of it. If the government pulls the plug on this benefit in Canada, I predict you'd see significantly fewer parental benefits offered by the companies.
Having said that, it is naive to think this isn't a fairly large burden on a company -- especially for a software company. First, assume that the company is paying the benefit -- say 50% of salary. That's an expense. Then you have to hire a contractor for a year. The rule of thumb is that a contractor costs double. So you have the same overhead cost (same number of desks), but you are paying 250% of the salary (plus applicable taxes). Then consider the domain knowledge that the worker on leave has. How long will it take for the contractor to get up to speed? So you have a loss of productivity. And the hiring process itself isn't cheap. In the end with all of the costs, you will probably be paying up to 3 times the original salary for the person on leave.
I leave this for the end because I know it is a potential sore point with many people given typical gender based roles. Without wanting to get into that discussion, there is always the chance that the person who goes on parental leave (whoever it might be) will decide not to return to their former career. A year of child care is a long time and many people (for many good reasons, IMHO) decide that this should be their new career. So a company, having paid nearly 3 times the employees salary in costs and lost productivity, may end up simply losing that employee anyway.
It is hard for the company to deal with -- especially small companies that don't have a lot of excess money/time to afford the expense. Again, I'm not saying it shouldn't be the norm, but closing your eyes to the very real hardships of the company in this case will not help it expand.
Shouldn't this be considered the cost of doing business? Here in Australia we have mandatory employer retirement contributions of 9.5%. I'm sure small business would love not having to pay this, but that is the cost of employment.
Also, unlike pension contributions (here Japan we have to pay 7% pension and 7% health insurance!), parental leave costs are not applicable to all employees; just ones that are going to have babies. So if you have 10 employees and one of them goes on parental leave, suddenly your costs have gone up 20%. As much as this is "the cost of doing business", it's pretty hard to plan for that when you don't know the procreational schedule of your employees. Do you keep a float of capital "just in case"? Heaven help you if 2 people go on parental leave at the same time! How many start ups are going to budget for babies rather than spend that money trying to expand growth? I'm not saying it's impossible, but it is far from easy.
Even worse, in countries where there is no paternal leave, this means it is a cost/risk that applies only to young women employees. I hope it goes without saying that this creates a terribly uneven playing field for women in industry.
Like I said, I'm a staunch advocate of parental leave, but I don't think it is an easy situation for anyone.
Ideally the state pays for this through taxation or via levy against large corporations. This way everyone has access, even those not fortunate enough to work at Microsoft.
By that logic, offering parental benefits is a way to encourage people to have babies. That's always seemed a bit weird to me because it seems inappropriate for a company to be involved in something so personal. It seems reasonable for the government to say, "we want more people to have kids for the greater good" but it seems strange for companies to take it upon themselves to do that.
I'm not saying new parents shouldn't be able to take time off, but it seems like people who choose not to have kids should receive similar benefits. Maybe companies should offer sabbaticals to everyone, and if some people choose to use that to take time off after having kids, then that's fine. But if someone isn't interested in having kids and instead wants to spend three months pursuing a hobby, that seems equally valid to me.
Thoughts?
Existing employees are going to have a baby either way, in the grand scheme of things a few months aren't going to change your mind about having a child. On the other hand, all things being equal, working for Microsoft vs working for another big corp, having more time off for your kids could tip the scales in Microsoft's favor.
I actually agree that, from a rationalist perspective, offering everyone periodic sabbaticals with a lot of scheduling flexibility is a nice thought. (Not quite the same thing--but I've always thought Intel's sabbaticals were a nice practice.)
- I seriously doubt this leave will have any bearing whatsoever on whether an employee decides to have kids. It is such a major, life changing and personal decision it is taken irrespective of incentives. Only serious constraints (no money) might negatively impact that decision. As a new parent, I was very happy to get leave from my company but I would have had kids regardless. Also I never heard of anyone having kids so they could get the 12 weeks or whatever or leave :)
- Another way to look at this is you have people that are having kids and people that are not. What can the company do to keep the former happily employed/interested in joining your company?
When I get to the stage in my life where I want this benefit, I'll shift over to MS or similar companies. I'll work there for a few years, take this benefit, and then shift back to a company that comps me with cash once I'm done having children.
It would be pretty silly if a 22 year old decided to work at MS for 15 years, simply to use this benefit for two children they bear at age 31 and 33.
Parental leave is a good way to keep people with kids happy. Why shouldn't we also keep people without kids happy? Everyone deserves time to pursue passions outside of work. Some people are passionate about their families. Other people are passionate about other things. I think employers shouldn't have an opinion on which is more valid, and they should support both.
> Why shouldn't we also keep people without kids happy? Everyone deserves time to pursue passions outside of work. Some people are passionate about their families. Are you trying to say that because people with children have parental leave, people without children should have equivalent leaves too? That sounds a little ridiculous to me.
How so? They probably work harder (for the employer) than the ones with children but deserve less PTO?
As a parent I never come in late and stay for dinner. This means the dinner service is an employer cost that I get no benefit from. Clearly the single people are the primary reason for this unnecessary cost to the company. I also don't drink soda and I'm not sure why my employer encourages this behavior by spending so much money on free soda everywhere. Lets nix that too!
Maybe you see what I'm getting at. The employer is just trying to accommodate and please people with various life choices for good retention and hiring rates. There's no reason that they absolutely shouldn't offer something to kid-free people only, it's just that they don't currently, probably because they don't think it will help much.
I've always viewed benefits like this as a way for the company to incentivize and/or reward certain behavior from employees. Offering a 401(k) match is a way to encourage employees to save for retirement.
By that logic, offering family insurance benefits is a way to encourage people to have families. That's always seemed a bit weird to me because it seems inappropriate for a company to be involved in something so personal. It seems reasonable for the government to say, "we want more people to have families for the greater good" but it seems strange for companies to take it upon themselves to do that.
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Some things don't benefit you personally and are still good things.
They do. In Microsofts case they recieve 12 weeks for parental leave, with mothers getting an additional 8 weeks. All Microsoft employees get that.
That some choose not to exercise those benifits does not mean they do not have them.
If someone elects not to use the 401k matching should they get the cash equviant? Your position is they should because they chose not to exercise the agreed upon package.
Or if someone gets into an accident and health insurance covers $100k of his medical bills, it's only fair that you, who was not in an accident, get $100k in cash because they got a benefit you didn't.
Every Microsoft employee gets the same benefits package. It is already fair. You personally may not hold parts of that package very important but that only influences how much weight that part of the compensation has when choosing other oportunities.
Also, Microsoft has a sabbatical policy, it's a separate thing. But you haven't let facts get in your way up until now, so why start.
On another note, I don't think it's a good idea to pretend like this is simply another in an endless variety of choices people make about their lives that can be incented one way or the other. When people have kids it tends to alter the way they see the purpose of their whole life. It's not "oh sweet, I can get a tax credit if I buy a Prius".
I'm now skeptical of workplaces where everyone else is like me, with no family that wants them home by dinner. I don't actually think these policies will successfully incentivize anyone to start or not start families, but even if you wanted to be that cynical, there's a clear advantage in work-life balance for everyone to encourage a sizable fraction of your employees to have families. A sabbatical for single people wouldn't accomplish the same long-term effect. (I'd be specifically worried that the "hobby" would be good for the company, since I can see myself easily falling into that trap.)
On balance, you're coming out ahead, not the new parents.
I'll accept that.
> By that logic, offering parental benefits is a way to encourage people to have babies.
This does not follow. You are assuming that if a company offers something that might incentivize people to do X it must be because the company wants to incentivize X. You are overlooking that it could be they want incentivize Y or disincentivize Z (so both) and this also happens to incentivize X for some people.
I don't think there are many people who would not otherwise have had children who will decide to go ahead and have a baby if their company offers better parental leave. There are probably many people, though, who have decided they want children, and might consider leaving their company for one with better parental leave policies, and so I think it is more likely that this is about keeping employees rather than influencing their reproductive behavior.
I'm shaking my head reading this comment.
Also please do not equate having a baby to pursuing a hobby.
Society feels differently, and Micorsoft here recognizes this and can use that to provide incentives to future hires and retain existing ones.
Secondly, raising kids is not a hobby, that's why they shouldn't be conflated.
And you can take your entitlement charge that you're about to level at me and shove it up your ass. I don't have kids, I won't have kids, I really kind of hate kids, but even I can see it's not a god damn hobby.
It's not a sense of entitlement that drives these kinds of changes. It's a recognition that child rearing is an important societal activity, and that in a modern, privileged, civilized society we should not have workplace policies in place that are hostile toward parents. Ageing populations are a real and present threat to many first world countries. In most western countries this is recognized at the governmental level with leave schemes, childcare subsidies etc.
This is also in response to changes in work patterns. In the 50s it was very uncommon for both mother and father to be working. Now the opposite is the case. Shouldn't society then move to restore the balance in a sense by applying what you call "special benefits" to parents?
I should have been more specific that parents should not be entitled to special benefits at work. It would make sense for a government program to subsidize child rearing to some extent.
This always comes up when this topic is being discussed. I don't understand what it is about the American psyche that makes us get so worked up about someone else (often in demonstrable need) receiving some sort of help.
I realize I'm stretching a bit here, but your opinion lives in the same realm as some other doozies we often hear:
"Why do women get special tech recruiting events??? Nobody set up a special event to recruit ME. I had to network all on my own"
"Why should my tax dollars pay for a transit system I don't use???"
"Why should inner city schools get subsidized lunches? I had to bring mine every day!"
This is why we can't (and don't) have nice things.
Sabbatical could be a benefit that kicks in after several years, and any parental leave before that time would just be subtracted.
That's why the state stepping in is important, this needs to be the norm at a federal level. Otherwise we'll have the rich spend more time with their kids and raising healthier/smarter children, and the poor raising a class of slaves (low child IQ is connected to less parental involvement in early years) to serve the rich. That's not the American dream.
An interesting reversal of history, in a sense. For example Victorian England, where the rich were the ones with the means to "outsource" the raising of their kids, and often did so.
Children of the posher classes would often have a more intimate and parent-like relationship with their "nanny" (or "nurse" or another member of the household staff), than with their own parents. The childrens' lives and daily timetables were managed entirely by the staff, and they were wheeled into the company of the parents for various daily occasions such as meal-times (and a pat on the head before bed). Aside from this, they spent their time relegated to the nursery, or in classes, or on outings with the staff.
Nowadays, on the other hand, spending lots of time with the children is something that might be considered a luxury reserved for the financially secure (who aren't spending all their time taking busses to three jobs).
The employee defers up to 18K (IRS limit), MSFT matches 50% of it, which is up to 9K.
Previously they contributed 50% of the first 6% the employee deferred = a maximum of 3% of the salary. So for anyone who makes less than 300K (9K / 0.03), this means a higher match from MSFT.
What is sad and pathetic is that in the US people are actually shocked by how good this is!! Everyone is programmed to go into "Oh but this will be a huge burden on the company" mode.
What about the fact that currently the US has some of the shittiest laws on the books when it comes to Time-off for new parents?
What about the burden on society when New Moms are forced into their workplace way too soon because of the crappy support from the govt.? So companies do not have to bear this burden but the new moms & babies can bear the hardship easily?
Free enterprise does not mean a license to shirk some of the most basic responsibilities. We should be pushing our elected peeps to take stornger action on this