Suppliers that do business with Microsoft in the US will have to provide employees handling the company’s work with at least 15 days of paid leave each year, Microsoft announced on Thursday.

“We believe paid time off is an important benefit for workers in our economy,” Brad Smith, general counsel and executive president of legal and corporate affairs at Microsoft, wrote in a blogpost announcing the new initiative.

The new requirement will apply to suppliers with 50 or more employees. Employees who work on Microsoft-related projects and are with the supplier for over nine months will be eligible for 15 days of paid leave – either in the form of 10 days of paid vacation and five days of sick leave or 15 days of unrestricted paid time off.

“[B]ecause we recognize that this approach may increase the costs for some of our suppliers, our plan is to work with them to implement these changes over the next 12 months,” wrote Smith. “We appreciate that this may ultimately result in increased costs for Microsoft, and we’ll put a process in place for addressing these issues with our suppliers.”

Specifically, the company is worried that this new requirement could affect the diversity of its suppliers. According to Microsoft, businesses owned by women and minorities account for more than $2bn of their supplier services. Minorities are also among the groups disproportionately affected by lack of paid time off.

In his blogpost, Smith admitted that the initiative isn’t entirely for the workers’ benefit. Paid time off often results in a happier workforce, which results in a more productive workforce.

Additionally, paid sick leave helps improve overall health in the workplace.

“One flu day reduces on-the-job transmission by 25%, while two flu days reduced such transmissions by 39%,” Smith pointed out.

US businesses do not need to give workers any days off whatsoever – for vacation or sick days – under federal law.

Some states have passed laws forcing businesses to provide a certain number of sick days.

The US is also the only developed country that doesn’t guarantee paid maternity or parental leave to its citizens. Three states have local policies.

In 2014, 77% of Americans working for privately owned companies got paid vacation days, typically between 10 to 14 days a year. And 74% of full-time workers and 24% of part-time workers in the private sector were offered paid sick leave, according to the US Department of Labor.

“Today, we are the only advanced country on Earth that doesn’t guarantee paid sick leave or paid maternity leave to our workers. Forty-three million workers have no paid sick leave – 43 million,” Barack Obama said during his State of the Union address in January.

Two lawmakers – Senator Patty Murray and Representative Rosa Delauro – are trying to change that.

In February, they reintroduced the Healthy Families Act that would allow workers a week of paid sick leave. But the legislation is unlikely to pass through the Republican-dominated Congress.

Obama has also expanded paid leave for federal workers who have to care for a new child or family member who is ill. They can now take six weeks of paid sick leave.

In April, Obama’s labor secretary, Thomas Perez, and White House senior adviser Valerie Jarrett are launching the “Lead on Leave” road show to help garner support for paid-leave policies.

In the summer of last year, the Vacation Equality Project attempted to get the White House to address why the US didn’t have a law requiring paid time off by launching a petition on the We the People site. The petition did not get the 100,000 signatures needed to warrant a response.



Americans who do get paid vacation don’t always use it. In 2013, Americans who received paid vacation only used 51% of it, according to a Glassdoor survey of 2,300 workers.