Facebook’s New Minimum Wage Requirements

FBLast week, Facebook took a stand in the minimum wage debate.

to many reports, including this one: “Vendors or contractors in the
U.S. who do a “substantial amount of work” with the social media company
will be required to pay their workers at least $15 an hour. Other
requirements include offering at least 15 paid days off for vacation,
sick pay and holidays. Additionally, individuals who do not currently
receive parental leave will be offered $4,000 in “new child” benefits.”
Not surprisingly, the White House is happy with this decision.

you know what? So am I. And even as onerous as it sounds (and a $15 per
hour rate can be very onerous for some, not to mention the time off
requirement), so should you be.

By imposing these requirements on
its vendors and contractors Facebooks is taking some risks. And opening
a can of worms. They risk that important vendors may choose to not do
business with the company anymore because they can’t afford to or just
plain resent the requirements imposed on them. And they risk that the
companies who choose to stay in as a supplier or contractor decide to
raise their own prices in order to protect their margins (as any smart
business person would do) which would ultimately end up in higher costs
for both Facebook and their customers. And the can of worms? How is
Facebook going to enforce this rule? They have hundreds, if not
thousands of contractors and vendors all across the world. Will they go
to the expense of creating a separate audit team? Will they have to
devise a new system of policies and procedures to makes sure new vendors
are in compliance and existing vendors must satisfy annual reviews?
This seems like an enormous undertaking even for a giant company like

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