Childcare Options for Small Business Owners

 

Being a small business owner and a parent can be complicated. Sometimes the needs of your business and children clash, making life difficult. Your employees have the same problem. Except when their childcare conflicts become significant, they’re often apt to quit.

Given today’s cost of hiring and training employees, losing workers over childcare issues isn’t wise. That’s why many business owners provide childcare assistance to their staff. The options range from providing stipends that reduce out-of-pocket costs to having an onsite daycare facility.

Whatever the approach, the benefits of helping parents pays for itself with lower employee turnover. Plus, 10% to 25% of a firm’s childcare investment is tax deductible, up to $150,000 annually.

Below are several practical ways you can help your employees address their childcare concerns:

Subsidize Your Employees’ Childcare

One possibility is to subsidize a portion of their expenses, as this lowers their out-of-pocket costs. Consider negotiating a group discount with a third-party provider if your budget is limited. You’ll still get credit for helping your people, but with no financial impact for your business.

Set Up Dependent Care Flexible Spending Accounts

These arrangements let employees direct a portion of their wages into a pretax savings fund. They don’t have to pay taxes if they use the money for approved child-related expenses, such as daycare, summer camp and preschool.

Promote Flexible Work Arrangements

Unanticipated events happen to employees with children. Their child (or children) can get hurt at school or become sick. Their school might shut down for a snow day or because of heating or other mechanical problems. Or the principal might request their presence due to a disciplinary matter. Whatever the emergency, parents often need to drop everything to focus on their children for a few hours, which is difficult when they must adhere to a fixed business schedule.

Recognizing this need, small firms often allow employees to leave work to handle family matters assuming they finish their tasks later. They can either finish up at home or work longer the next day. The point is that enlightened employers trust their people to do whatever it takes to complete their duties. In return, grateful employees reward them with higher productivity and loyalty.

Provide Predictable Schedules

If you can’t provide a flexible work arrangement, do the next best thing: give employees predictable schedules. Parents typically have a rigid daycare drop-off and pick-up timeframe. Shifting work times throws a big monkey wrench into their day. Consistent scheduling produces higher job satisfaction and lower turnover, experts say. And it costs you nothing.

Offer Emergency Childcare for Your Employees

If none of the ideas above work for you, here’s another: Consider helping your employees deal with childcare emergencies. How does this work? You pay for care (or subsidize it) when an employee’s regular provider falls through. You can keep costs reasonable by limiting the benefit to a certain number of days per year.

Establish a Daycare Facility at Work

The cost and complexity of this approach can be daunting. But for larger small businesses with a critical mass of family-oriented employees, it can be feasible with sufficient planning. And remember, you can deduct up to $150,000 in childcare expenses from your taxes. For this reason, your net cost might be lower than you think.

In short, don’t assume your childcare offerings are limited. You have a variety of solutions at your disposal to help employees access quality, affordable daycare. The more you can help them with this crucial challenge, the more you help yourself. Good luck!