Facebook Presses Vendors to Increase Pay, Benefits for Contract Workers

Silicon Valley is responding to increasing public commentary about the gap between the 'improving the world' pronouncements it tends to spout and the conditions under which many of its employees and contractors labor.

Matching rhetoric and reality is always a good strategy. JL

Deepa Seetharaman reports in the Wall Street Journal:

Wages of $15 an hour, 15 paid days off annually for holidays, sick leave and vacation. Facebook will also require new parents receive a $4,000 bonus if they don’t get paid parental leave.Facebook expects to bear the cost of the new standards as vendors increase their rates.
Facebook Inc. FB -1.17 % is pushing its vendors to improve pay and benefits for their workers, including wages of at least $15 an hour, in the latest example of Silicon Valley trying to address yawning economic divisions in the region.
In addition to the minimum wage, the social network is requiring contractors to give workers who do a substantial amount of work with Facebook at least 15 paid days off annually for holidays, sick leave and vacation. Facebook will also require that new parents receive a $4,000 bonus if they don’t get paid parental leave.
A Facebook spokeswoman said she couldn’t estimate how many workers would be affected by the change, but said it would cover food-service, security and janitorial workers, among others, at its U.S. facilities.
Facebook said it expects to bear the cost of the new standards as vendors increase their rates.
The rules took effect for Facebook’s largest vendors on May 1; it plans to expand the program to other contractors over the next year. California’s minimum wage is $9 an hour, above the national $7.25.
“We think it’s the right thing to do with our community and the right thing to do with our business,” Chief Operating Officer Sheryl Sandberg said in a recent interview. “So we think it’s an expense worth bearing.”

Ms. Sandberg spoke shortly before her husband, SurveyMonkey.com LLC Chief Executive David Goldberg, unexpectedly died on May 1 while vacationing in Mexico. Ms. Sandberg returned to work on a limited schedule this week.
Facebook’s move is among several by Silicon Valley companies seeking to address concern over economic disparities in the region, which have occasionally flared into protests against tech workers.
Joint Venture Silicon Valley, a regional think tank, says the median annual income for high-skilled workers in the region is about $119,000, while the median income for low-skilled workers is about $27,000.
Both Google Inc. GOOG -0.85 % and Apple Inc. AAPL -0.14 % in recent months have said they will make security staffers full-time company employees with benefits.
Drivers of buses that shuttle Facebook employees to and from work in March approved a Teamsters union-negotiated contract that will raise their pay by 50% to $27.50 an hour, giving the union momentum to negotiate with drivers for six other Silicon Valley companies.
“Facebook has led the way in this area,” said Rome Aloise, international vice president for the Teamsters union. “I think they’re being responsible employers” and other tech companies are taking note.
Several Facebook vendors declined to comment, including maintenance firm ABM Industries Inc., ABM -0.93 % technology-services provider Milestone Technologies Inc., and Pro Unlimited Inc., which manages Facebook’s relationship with vendors.
In the interview, Ms. Sandberg said women would particularly benefit from the new rules because they make up two-thirds of minimum-wage workers in the U.S. She highlighted the $4,000 bonus for new parents as a key to making sure both men and women can afford to take time off for a new child.
Even so, the new benefits for Facebook’s contract workers are a far cry from what Facebook and other tech giants offer their own employees.
Facebook offers employees $4,000 in “baby cash”—in addition to paid parental leave and help with day care and adoption fees.
The company also offers 21 days of vacation, 11 holidays and unlimited sick days, plus free meals on its campus and help paying for gym memberships and laundry bills.