Corporate Child-Care Efforts Inching Along
Corporate America is increasingly facing the demographic fact that more workers belong to families where both spouses work and have responsibilities to care for young children.
Yet progress by companies in providing child-care assistance and other family programs is slower than many workers would like. And innovative approaches are few and far between.
“A lot of people in upper levels of corporate management still aren’t dealing with these things,” says Carol Moenning, a consultant for Hewitt Associates, an employee benefits consulting firm. “Most people in top management are older, have grown children or can afford to have someone in their home take care of their children. So the issue is not plaguing them” the way it does younger workers.
Corporate managements, Moenning adds, must realize “that we’re not going back to the Ward and June Cleaver era.”
All told, 64% of large companies offer some kind of child-care assistance to employees, according to a recent Hewitt Associates survey of benefit practices at 837 large employers. That’s far more than a few years ago, Moenning says.
Such programs have grown in part because child care is often the most pressing employee need, she says.
Yet many firms--facing cost-cutting pressures and concerned about liability issues--are trying to provide child-care programs on the cheap, or with minimal effort.
The most popular type of child-care benefit among employers is dependent-care spending accounts. These accounts--offered by 89% of the firms with child-care programs surveyed by Hewitt--allow employees to pay for child-care expenses with pretax dollars deducted from their wages. While these programs can result in considerable savings to working parents, they cost firms very little.
Next most popular among corporations--offered by 41% of those with child-care programs--are resource and referral services. Rather than provide such referral themselves, companies often contract with outside referral services.
Yet only 9% of companies with child-care programs actually provide what many working parents think is the most essential service: employee-sponsored child-care centers. Most of those employers are hospitals or government entities, Moenning says.
Only 3% of employers with child-care programs provide financial support for outside child-care facilities; another 3% provide voucher programs.
“We still have a long way to go,” Moenning says.
Fortunately, a small but growing number of companies are offering other types of child-care programs, Moenning says:
Programs that provide activities for kids on school holidays or summer vacation. John Hancock Mutual Life Insurance in Boston takes kids on field trips. Johnson Wax in Racine, Wis., has a wellness facility.
Programs that care for children who are ill. These are for parents who might otherwise have to stay home to take care of ill children. Apple Computer, for example, has set aside part of its child-care center for the care of mildly ill kids.
Altogether, 3% of companies with child-care programs in the Hewitt survey offer sick child programs.
Direct subsidies and reimbursement for employees working overnight or overtime. Some companies are offering to pay for baby-sitters, nannies or other child-care providers for employees working overtime. Tandem Computers will pick up $40 per day in child-care expenses for employees on business trips, Moenning says.
Schools at or near work sites. Dayton Hudson in Minneapolis is developing a private school at a work site, Moenning says.
Job flexibility. Hewlett-Packard and Levi Strauss offer a job-sharing program under which two women on maternity leave--both of whom might quit if required to work full time--can share a job and each work part time.
Kemper Financial Services in the Chicago area is using a pool of retirees to replace people on maternity leave. This allows some to stay longer on maternity leave.
Employees at Key Bank in Albany, N.Y., can take the summer off to spend with their children, Moenning says. They are replaced with college interns.
Moenning says employers must realize that many of these programs will more than pay for themselves in increased productivity and reduced absenteeism.
And a lot of these benefits can be provided without big expenses, she adds, noting that John Hancock has said that its field-trip program cost only about $2,000 a year.
WHAT EMPLOYERS PROVIDE Percent of employers providing the following (based on 837 survey respondents) Child Care*: 64 Elder Care*: 32 Flexible Schedules: 54 Paid Parental Leave: 5 Unpaid Parental Leave: 44 Paid Medical Leave: 23 Unpaid Medical Leave: 21 Adoption Benefits: 12 Employee Asst. Programs: 73 * Includes resources and referral services and other off-site programs Source: Hewitt Associates
