Should More Offices Offer Daycare?

Maternity and paternity leave are hot topics of conversation in the 21st century, and for good reason. And while we're moving towards a better system and increased paid parental leave, most young parents still find themselves spending over a quarter to a half of their annual income exclusively on childcare -- this is especially true in the early years of a child’s life.

As fewer and fewer single-income homes emerge, the onus is beginning to fall on the corporations to make things easier. While many strides have been made in recent years to drive better maternity and paternity leave policy, there’s still much to be done in distributing the burdens of childcare horizontally.

One commonly cited option is corporate daycare programs -- a way for employees to come to work while having their child taken care of within earshot (and, ideally, without stress on the wallet). This article will dive into the potential benefits and pitfalls of office daycares, and ways that they might be implemented to optimize for success.

First, are office daycares worth it? 

The beauty of the “office daycare” debate is that one side’s argument is extremely simple. Why SHOULDN’T offices have daycare systems? Because they cost money.

That’s it.

While there are certain logistical challenges that come with corporate daycare programs, they’re largely easy to deal (especially when working with 3rd party implementation teams). The only real tangible drawback is the cost -- and that cost is also primarily a capital cost. Most of the expenses are involved in facility building (which is moot if you already have unused space available) and licensing.

After that it’s primarily staffing costs, which actually end up cheaper on a per-child basis at the corporate level because you get “volume” discounts (for lack of better phrasing).

Extended as a perk to employees absent a slightly lower salary, companies can even break even on daycare costs thanks to this benefit. Not to mention the multitude of new tax credits being introduced by different states to help offset the costs - even the primary drawback is becoming less of a factor.

The benefits of office daycare are many. For starters, it makes you significantly more appealing as a workplace. Companies who have tested office daycare programs report 25% higher rates of employee loyalty - after all, it’s your family’s company.

It’s also appealing for new hires and unlocks a wider talent pool. New or expecting parents have a very narrow pool of companies they can choose from - offering strong maternity/paternity programs and office daycare puts you a cut above the rest. To a similar point, it also encourages more women to apply - after all, childcare is one of the biggest reasons why women often lose pace on the corporate ladder.

Should companies provide parents a childcare stipend?   Here’s a stat for thought: companies that help with childcare see a 30% decrease in absenteeism and a whopping 60% reduction in turnover.

In other words, not all perks come equal.

What often amounts to a relatively small investment in the grand scheme of things - say a matching $4,000/year childcare spending account - ends up being an incredibly fruitful investment in your employees’ long-term livelihoods.

For most young parents, childcare is the single most important part of their lives - by contributing to their childcare in a meaningful way beyond leave, you position yourself as a very family-friendly operation and inspire a LOT of employee loyalty.

And, again, positioned properly, it doesn’t even have to impact your budget much, if at all, especially when taking advantage of the aforementioned tax credits (like the US Child and Dependent Care Tax Credit).

A childcare stipend is a fantastic way to continue offering support to young parents past the birth - and if the numbers are accurate, it’s clear that employees who see that support in the most crucial period in their lives, pay it back to their company 10-fold.

How can we edit the in-office expectations of parents to make their lives easier?  

The frustrating fact of childcare and office conflict is that it’s largely manufactured. The fact is, for a well run organization, a teammate having a child shouldn’t present any kind of disruption - at worst it should bring mild delays to certain specific deliverables.

The conflicts and stress that come with childcare for corporate employees typically comes as a result of expectations management. Poor communication and mismanagement of the relationship leads employees to feel they’re underperforming or being expected to do much - with the companies then, cyclically, responding to that negativity…. Well, negatively.

Beyond daycare programs, stipends, maternity/paternity programs or any other childcare support programs, the most important way to help young parents in the workplace is through proper expectations management.

This involves a few different things.

1. Concrete Policy & Benefits - Nothing makes childcare planning more stressful and uncertain than “fuzziness” around what the parent can expect from their employer. Too many employers hide behind layers of red tape, bureaucracy and legalese to make their childcare benefits unclear - this is a terrible idea. Companies need to be proactive with their employee childcare management. From day 1 outline, in very plain and simple terms, EXACTLY what company policy is on everything related to childcare - the work expectations, leave periods, benefits/stipends/perks and more. Your employees should know this information well in advance of childcare, and it should be extremely easily accessible.

2. Judgment-free Management - It’s true - a new parent isn’t going to be quite as efficient as they were before the child was born. But, if anything, after the initial adjustment period, you’re likely to have a significantly more engaged employee. The loyalty earned from your childcare support as well as their added responsibilities and maturity will directly improve your bottom line. In other words, accept the early losses. Don’t push your employees too far, don’t pester them about their return date, and be completely transparent about your expectations of their workload. Reiterate (constantly!) that the employee is doing fine.

3. Empathize with Shifting Priorities - While this job might have been the employee’s top priority a few months ago, it isn’t anymore. Conflict arises when employers struggle to deal with that - when they see their star performing no longer going quite as many extra miles, or taking more time off and passing over more opportunities. Expecting your employees to offer the same priority to your organization once they have a child is a recipe for disaster. Your employee will soon be just as productive if not more once the adjustment period is over - the worst thing you can do is expect that from Day 1 and lash out at them when it doesn’t happen.

Childcare is the single most significant event in most people’s lives. The frustration and conflicts that come with balancing childcare and a career are so bad that half the population has, for decades, been hamstrung financially because of it (see: the Motherhood Penalty). By now, however, we know better - investing in your employees’ childcare will, in turn, double their investment back into your company.

Hey, it’s simple math!