Thought leadership

Dependent Care Creates Challenges in the New Reality

Dependent Care Creates Challenges in the New Reality

Kevie Mikus, Heartland Regional Leader

Yvonne Gardner, Senior Consultant 

Cody Bengtson, Associate Consultant 

 

Faced with potential lags in productivity and diminished employee wellbeing due to increased stress in working from home, employers are seeking creative solutions to the challenge of dependent care.  

Navigating a new range of educational approaches for fall classes adds to family stress. From all-virtual to virtual plus in-person modified plans for classroom reentry, employees with school-aged children face managing work, school and dependent care.

Even for the most organized employees, trying to juggle dependent care and work can reduce productivity on the job. According to a 2019 report from the Council for a Strong America, employers lose about $13 billion annually in potential earnings, productivity and revenue due to inadequate dependent-care resources. 

In an attempt to address such challenges for working families, Congress passed the Families First Coronavirus Response Act in March. The legislation guarantees two weeks of paid sick leave at two-thirds of an employee’s regular pay for individuals who can’t work because of a lack of child care. However, the Act applies only to workers at private companies that employ fewer than 500, as well as to certain public sector employers. Those benefiting represent only about 27% of the U.S. workforce, according to data from the Bureau of Labor Statistics. Many, but not all states, have enacted companion legislation to expand these requirements to larger employers.

Beyond ensuring that employees are aware of leave programs, employers are well-positioned to step in creatively to help employees tackle dependent-care challenges. The shifting employment landscape presents opportunities for organizations to differentiate their employee value proposition (EVP).

 

Then and Now – Employee Priorities are Shifting

Prior to COVID-19, benefit trends included customized health benefit solutions. Such plans allow those with fewer health access needs to “pay as you go” through HRAs and just in-time-medical services. In addition to health benefits, some employers offered onsite culture and lifestyle benefits such as prepared meals, recreation areas and concierge services. Employees unhappy with their current benefit packages could move to a new employer better able to meet their needs.

Today, employees once again are asking employers to address workforce needs—and those needs are shifting. Managing work, juggling child care and navigating changing return-to-school plans create unprecedented challenges—and opportunity for employers. More and more employees are looking to their employers for resources and support.

Organizations seeking to create a compelling EVP as part of their overall talent management strategy must think broadly about how to address the emerging dependent care issue. 

Pre-pandemic, only 4% of U.S. organizations offered a subsidized child-care center or program for their employees, according to the Society for Human Resource Management’s (SHRM) Employee Benefits 2019 survey. Another 4% of organizations offered non-subsidized care in the form of company-affiliated, on-site child care, SHRM found. As another child care option, roughly 11% offer employees access to a referral service. Examples include Care.com, which provides employees with the names of child-care providers, and Helpr, specializing in teaching resources such as tutoring, credentialed on-line teaching and facilitation of learning pods.

 

How Can Employers Build Better Workforce Wellbeing?

Employers are finding creative ways to rise to this challenge:

Offering flexibility

  • Time-limited “sabbaticals” with benefits
  • Job-sharing arrangements
  • Flexible work schedules

Providing subsidies & resource stipends

  • Membership in childcare and teaching resource sourcing sites
  • COVID-19 regular testing vs. exposure-only testing programs
  • After-school and other community program supplements

Creatively leveraging existing resources

  • Opening existing collaboration technology to employees
  • Developing on-line sharing communities and resource groups for employees to share experiences and collaborate on solutions
  • Leveraging EAP to assist employees in securing child care and other dependent care resources

 

Developing Your Organization’s Reset Strategy

Gallagher’s Human Resources and Compensation Consulting practice offers expertise to support your organization in adjusting to a new way of operating. We work closely with many organizations to tailor their unique “reset” strategies, including:

  • Compliance assistance with the Families First Coronavirus Response Act (FFCRA)
  • Policy and procedure development for dependent care support (paid time off, unpaid leave, sabbaticals and other solutions)
  • Compensation consulting to build supportive frameworks for employee wellbeing, including use of flextime or job sharing
  • Training for managers on effective leadership of a remote team, including enhancing emotional intelligence, resiliency and managing performance
  • Training for employees in clarifying and meeting performance expectations and communicating effectively
  • Pulse surveys to ascertain your workforce resiliency, identify drivers of reengagement and determine the best way to take action

Our seasoned consulting team stands ready to help. Contact Kevie_Mikus@ajg.com or 615-324-1142 to help your organization face the future with confidence.

GallagherHRCC.com


Consulting and insurance brokerage services to be provided by Gallagher Benefit Services, Inc. and/or its affiliate Gallagher Benefit Services (Canada) Group Inc. Gallagher Benefit Services, Inc. is a licensed insurance agency that does business in California as “Gallagher Benefit Services of California Insurance Services” and in Massachusetts as “Gallagher Benefit Insurance Services.” Neither Arthur J. Gallagher & Co., nor its affiliates provide accounting, legal or tax advice.