Hiddink has revitalised the squad since taking over from Jose Mourinho on an interim basis in December.
He has overseen a 12-match unbeaten run in the Premier League, to put the Blues in with a real chance of European qualification.
But he looks certain to leave Stamford Bridge at the end of the season, with Antonio Conte in line to be appointed as Mourinho’s permanent successor.
And, asked what he thinks about Hiddink not being given the job full-time, Parlour told talkSPORT: “I am amazed.
“Why not? He is such an experienced manager and he would probably really look forward to trying to win the Premier League [next season].
“Conte looks like he is getting the job but everybody is playing well under Hiddink. He has gone back to basics, everybody is smiling and everybody is playing well – why not carry it on for next season?
“He has got a good coaching staff around him and he can have a real go at trying to win the Premier League back.”