Starbucks extends health insurance to employees' parents in Chinese

Starbucks announces that it will begin offering a "critical illness insurance plan" for the parents of its eligible full-time employees in company-operated stores across Mainland China. The employee benefit will cover employees' parents for 30 illnesses, such as cancer, heart disease, and some surgeries.

Launch in June, the plan is estimated to cover 10,000 parents of Starbucks workers in China.

The announcement is a response to the traditional responsibility in China for children to care for their parents, and a rising concern in the region in having the financial resources to look after their parents, Howard Schultz, executive chairman, Starbucks Coffee Company said.

"Supporting critical illnesses for aging parents exemplifies what we believe is our responsibility as a global public company and honors the family values deeply-rooted in the Chinese culture," Schultz explained. "Our core purpose and reason for being has always been driven by a set of beliefs steeped in humanity and I’m extremely proud to be able to support our Chinese partners (employees) and their parents through the Parent Care Program."

The company made the decision to implement the new policy after analysis showed that more than 70% of Chinese staff members are concerned about the health of their parents as they age. Moreover, the company found those who are single – about 80% of the retail staff – are especially worried about their financial ability to provide for their parents’ long-term care in case of a critical illness.

The coffee giant is the first multinational corporation in China to offer this benefit.

The new move may help Starbucks to retain employees, as well as build a reputation for employee rights and welfare in, what it called, the crucial "second home market".

The company is pushing ahead with its expansion into China to have about 5,000 stores in the region by 2021. It currently has about 2,600 stores, across 127 cities, and nearly 40,000 employees across the country.

This story was first published in Human Resources magazine.