Will expanded parental leave boost IKEA’s recruitment and retention efforts?
IKEA’s workers in the U.S. will have a new perk in their employment packages beginning on Jan. 1. The company announced that it is expanding its existing policy to offer up to four months of paid parental leave to hourly and salaried employees.
The new leave policy covers new mothers and fathers as well as those adopting a child or becoming foster parents. Under the new plan, individuals who have worked with IKEA for a year will be eligible to receive 100 percent of their base pay for the first six weeks of leave and 50 percent for the next six. Those who have been with IKEA for three years or more will receive 100 percent of their base wages for eight weeks and 50 percent for the next eight. These perks are in addition to the six to eight-weeks of disability pay available to workers regardless of their time with the company.
Only 12 percent of private sector workers have paid parental leave through their companies, according to USA Today, citing Labor Department data.
“At IKEA, we believe time with family and friends is so important for a healthy work-life balance and a happy and productive workforce,” said Lars Petersson, IKEA US president, in a statement. “This benefit, which applies to all parents, will give our co-workers the opportunity to spend more time with their families when welcoming a child. Our co-workers are our most important resource, which is why we continue to invest in helping them reach their dream.”
In a press release to announce its new policy, the furniture chain explained that it recently conducted an employee survey and found that achieving work/life balance was among workers’ top personal priorities.
IKEA is touting its leave policy and other steps as evidence of its employee-friendly culture. Other initiatives include:
- Increases in the minimum wage it pays workers in both 2015 and 2016;
- A reduction of between five and 25 percent in what the company deducts from employee paychecks for medical insurance in its 2017 fiscal year;
- A profit-sharing program called Tack, which means “thank you” in Swedish.
- New IKEA US parental leave policy expands benefit to up to four months paid leave for both hourly and salaried co-workers – IKEA US
- Ikea to offer expanded parental leave in stronger job market – The Associated Press/The Seattle Times (tiered sub.)
- Ikea expands parental leave to all U.S. workers – USA Today
DISCUSSION QUESTIONS: Will the steps IKEA has taken positively affect its employee recruitment and retention efforts? How competitive is the market for retail employees? How else are retail employers gaining an edge over competitors in the hunt for hourly and salaried talent?