75% of Indian women drop out of the workforce for childcare just before they are about to enter the most productive years of their career. This is a significant cost for organizations, which end up losing its committed talent pool.
With the increasing focus on Gender Diversity and new bill on amending the Maternity Benefits Act, 1961 which extends maternity leave to 26 weeks, mandatory crèche facility for establishment where no of workers exceeds 50 and option of work from home for nursing mom, companies need to understand the key steps involved in providing a childcare support benefit for its employees.
Prevalent practices and models on childcare support
Where do you leave the six month old child when you want to get back to work? Providing childcare support is a hygiene enabler for companies if they are serious about moving the needle on the gender diversity agenda. There are various models adopted by corporate India based on their requirements. Here are some of the prevalent ones.
Onsite daycare – An exclusive facility set up in the office premises only for employees. In this kind of an arrangement, the organization partners with a specialised childcare service company. Typically the set up and infrastructure cost is borne by the corporate and the operating partner runs the daycare typically offering concessional rates to employees. Organizations like Hindustan Unilever Limited, Standard Chartered Bank, Axis Bank, AmarchandMangaldas, Godrej, BhartiAirtel etc. have an onsite daycare facility for their employees.
Near-site daycare – Incase an onsite model is not feasible because of space constraints or the absence of a sizeable number of employees who want to use the facility, companies opt for corporate tie-ups with a daycare centre close to the office. Organizations like Adobe and Microsoft have near site centers
Multiple tie-ups – In this arrangement, the corporate ties up with multiple daycare centres to provide a range of options to their employees. The tie-up can be with a single partner who runs multiple centres or with multiple partners. Flipkart, Cognizant and many IT companies have tie-ups with daycare companies for their employees.
In all the above arrangements, the corporates can provide varying degrees of financial support to the employees, e.g. subsidy on fees, full or partial reimbursement against expenses etc.
Selecting the right daycare partner
It is important that companies study all the types of daycare arrangements and then decide the best option for them. A recent ProEves survey of 100 working mothers across Indian cities (Delhi, Mumbai and Bangalore) found that most of the working mothers highlighted onsite daycare benefit as the highest impact employer benefit for them. The following observations were found with respect to their childcare choices:
- Working moms spend the most or second most amount of time on childcare
- Around 35% prefer Help at Home to take care of their children over Daycare
- Around 50% want their employers to introduce daycare benefit, and this is ranked number 1 over flexible work arrangements
- Child learning, development and social skills are ranked as top 3 benefits of daycare
Working moms found it difficult to decide on a daycare centre as they were not sure of the health and safety standards, but leaving the child at home with nanny made them nervous throughout the day.
Before jumping into the type of arrangement, it is important to undertake a feasibility study to understand the utilisation confidence with respect to this benefit. The benefit utilization confidence tries to understand if you have the target audience that will be excited about this benefit; what are the choices of that target audience and is there an expectation match; and finally do you have a growing population that will convert into the target audience soon.
The checklist below lists the set of questions for a quick benefit utilisation check:
- Average employee age
- Percentage of young parents/ moms (having children between 6 months – 12 years)
- Percentage of young married women
- Nature of family support – Nuclear/ Joint family
- Location relevance – Key employee catchment areas
- Daycare preference factors for the target group
Based on the utilisation index, the company can decide which approach it would like to follow. Often an onsite childcare is not the most feasible option as companies may not have the minimum critical mass or space to support the same. Multiple tie-ups in the city provide employees flexibility to drop their child either near the office or near their residence.
Once the arrangement is finalised, it is important for the company to choose the right daycare partner based on the preferences of its employees. It is equally important to continuously audit the services and maintain a childcare query concierge service (a toll free number/ email id/ support group) that responds to queries of parents.