If you have kids, you probably know that child care tends to fall through at the most inconvenient moments.
This creates a stressful problem, and a costly one, too. According to the 2017 Child Care Aware of America Report, nearly half of working parents miss on average more than eight days of work a year because of breakdowns in child care. And for employers, that absenteeism gets expensive, to the tune of about $4.4 billion a year.
Subsidizing Care: A Win-Win Investment
That’s why supporting working parents isn’t just a generous thing to do for employee peace of mind — it’s a good investment in your workforce as a whole. And some businesses have caught on, offering employer-paid child care benefits that tackle four main areas: affordability, access, tax savings and workday flexibility.
Starbucks is one company leading the charge. In October 2018, the company announced that it would subsidize 10 days of backup child care each year for all employees. The subsidy makes backup care much more affordable for in-home and in-center services at $1 and $5 per hour, respectively.
Should you join them? The benefits of time and opportunity costs saved from missed work days make a compelling business case to do so, but according to a 2016 survey from the Society for Human Resource Management (SHRM), subsidized child care is still an underdog in the world of benefits. All told, just 2 percent of employers (big and small) reported offering the benefit, dwarfed even by the number of companies that offered day care at or near the work site (7 percent).
Why the lack of participation? It’s simple: Many businesses, especially small ones, just can’t afford it — even though they’d like to, and even though they realize the impact those investments could have on their bottom line.
If that sounds like you, don’t despair. The SHRM survey showed that there are other ways to go about supporting working parents.
Other Solutions: Tax Savings and Care Finder Services
Dependent Care Assistance Plans (DCAP), which allow employees to contribute pretax dollars for dependent care — much like health savings accounts do for health expenses — topped the list. About 56 percent of all employers in the SHRM survey reported that they offered DCAPs to employees, and 49 percent of small employers (50 to 99 employees) did so.
Like health savings accounts, DCAPs offer a flexible option for employers. You can help contribute as much or as little as you want to employees’ accounts, and your workers reap the benefits in tax savings.
With a 41 percent participation rate, child care location services (such as offering referral resources) were also popular, according to the SHRM survey. Other options trailing behind in the minority included summer child care, sick care and backup care.
And Finally: Good Old-Fashioned Flexibility
If none of these solutions piques your interest or meets your budget, simply building more flexibility into the workday can do a lot to help accommodate working parents. Consider flexible schedules that work around school pickup and drop-off times or work-from-home options for when child care falls through.
Because inevitably, it will — and when it does, it’s best to have solutions in place for your employees that save their sanity and your bottom line.
Stay up to date on the latest health care regulations and trends for your small business: Subscribe to our monthly newsletter.