Are On-Site Childcare Centers a Good Choice When It Comes To Employee Childcare Benefits?

An on-site childcare center sounds great, in theory. Employer-sponsored childcare, directly on the premises? Great! In reality, however, on-site centers often fall short of the intended goal of providing childcare assistance to working parents.

Make no mistake, on-site childcare centers may be a viable solution for employee childcare benefits — as long as certain criteria are met. They can also be too expensive, inflexible, full/waitlisted, and impractical for many organizations and their working families.

If you’re considering adding childcare benefits for employees, chances are you’re weighing all your options to find the best fit.

While a childcare benefits program centered around an on-site childcare center can certainly work under the right circumstances, multiple conditions must be met first. Then it might make sense to seriously pursue this route as a means of supporting your workforce’s childcare needs.

Chat with childcare experts at Upwards about childcare centers and employee care benefit solutions.

On-site childcare center benefits

So when are on-site childcare centers a good choice for employer-sponsored childcare benefits?

If you have your full-time personnel working exclusively in-person, and they live close to the office or worksite, it could be a smooth fit. Employees would also need to work fairly conventional hours and shifts, though. Most on-site childcare centers are only open in the 9 a.m. - 5 p.m. range, Monday through Friday.

If you can check off those first two boxes of in-person employees working regular business hours, there are more variables to consider. On-site childcare centers can be a useful option, if they’re not full/at capacity.

Unfortunately, in many cases the supply of open childcare spots cannot keep up with demand, causing long waitlists to be the norm. If there are no open seats at your designated childcare center, what do your employees do for childcare? The program becomes a childcare benefit that cannot be utilized by working families. They will be forced to find childcare accommodations on their own because they are unable to access this benefit.

The other factor determining if on-site childcare centers will work as part of an employee childcare benefits program is whether they are affordable enough for your workforce. Generally speaking, this is a heavy lift because childcare is already very expensive on its own.

Costs vary by state, region, and the age of the child. Center-based care is more expensive, on average, than other childcare options.

What are disadvantages of on-site childcare centers?

It’s true that on-site childcare centers can work, given the right circumstances. But plenty of limitations and drawbacks for this type of center do exist.

For every use-case of on-site childcare centers working as an effective solution in an employee childcare benefits program, there are multiple counterarguments against their feasibility.

The reasons that on-site childcare centers don’t really work include:

• The cost for employers: On-site childcare centers are expensive to build, manage, and maintain. A significant financial commitment upfront is required, along with ongoing costs to keep the program running with enough staff to adapt to the size of the workforce. There are cost-effective ways to offer childcare benefits for employees, and on-site childcare centers are not one of them.
• The cost for employees: Due to the center-based care model, large investment from the employer, and continual overhead of operating this type of program, the costs for employees are substantial. The result is childcare that is often unaffordable for the average worker.
• Too much liability for employers: By bringing a childcare center on-site, organizations also absorb liability for the facility. Companies risk serious financial losses in the event of an accident or adverse situation that unexpectedly arises.
• The reality of long waitlists: Even at very large on-site childcare centers, spaces are limited and fill up rapidly. This model might not support a growing workforce. It can also create uncomfortable workplace tensions, with not all employees being able to leverage a supposedly universal care benefit.
• Scheduling conflicts: With their limited hours only catering to the 9 a.m. - 5 p.m. crowd of workers, on-site childcare centers leave out the vast number of employees who work unconventional hours. This includes staff members navigating second, third, and night shifts. Not surprisingly, these are the working families who need reliable, affordable childcare the most.
• A lack of curriculum diversity: Many working parents seeking to utilize employer childcare benefits want to find programs that support cultural diversity. This could be in the form of a faith-based approach or specific curriculum/teaching style. On-site childcare centers typically offer a one-size-fits-all program.
• Proximity to where employees live: If workers live far from the dedicated childcare center, it will not be convenient for them to commute when they need childcare on any days they’re not actually at work. This scenario could arise if a working parent is sick or traveling and still needs childcare.
• Incompatibility with a remote workforce: If you have a segment of employees who are remote, geographically dispersed, or work a hybrid schedule, it becomes impractical for these working families to commute to one location for childcare.
• A lack of newborn care: Some on-site childcare centers do not offer newborn or infant care. This means that parents must find other childcare alternatives until their kid is one to two-years-old.
• No support for families with school-aged children: Most on-site childcare centers only offer care for kids up to age 5. Unfortunately, this leaves out working families with after-school care needs as well as support during the summer months and holidays when school is out.
• Increased exposure to germs and illness: The size of these larger on-site childcare centers means there are inherently more germs to go around, from the common cold to COVID-19. Many working parents are wary about large groups of children and perceive larger centers as an increased risk of bringing illness home to their family.
• Limited hours/schedule flexibility: On-site childcare centers are typically only open during conventional, 9 a.m. - 5 p.m. hours. As a result, childcare becomes inaccessible for those families with parents and guardians who work outside that rather narrow schedule.
• Care is tied to employees being at work: Onsite childcare centers only really work for the times that your workforce is, well, on the premises. If working parents need emergency/backup care while they’re away from the office, these centers just don’t fit the bill.

That is a long list, but each reason represents real families who could be missing out on crucial childcare due to the limited effectiveness of on-site childcare centers.

Employee childcare benefits are a necessary offering

Looking at the big picture, you’re exploring childcare benefits for employees and that’s an unequivocally great thing.

As you contemplate the employer-sponsored childcare benefits options available, it’s important to remember that adding any type of childcare benefits will have a good, positive impact on your organization.

Whether it takes the form of an on-site childcare center or a network of in-home daycares, nannies, and babysitters, implementing employee childcare benefits is going to be appreciated by your working families. Best practice is to carefully evaluate everyone’s needs and use that information to determine the best childcare solution for your workforce.

Upwards’ flexible childcare benefits for employees

Finding the most practical childcare benefit programs for your business is often linked to the childcare network you choose.

Upwards is the largest network of childcare providers in the U.S. and a market leader in the employee childcare benefits space. Our team leverages technology and caregiver expertise to offer affordable childcare benefits for employees at organizations in every industry.

The core of our childcare network consists of over 6,000 licensed in-home daycare providers, plus 50,000+ nannies and babysitters. These qualified caregivers provide high-quality, affordable childcare with more flexible schedules, smaller class sizes, and the ability to care for school-aged children.

Upwards has developed multiple employee childcare benefits programs. Childcare assistance helps working families find, access, and enroll with a quality, affordable childcare provider who works for their unique needs. We also offer full and partial stipends which can be utilized to offset employees’ childcare costs. Our backup care program supports parents when there is an emergency or their childcare plans change at the last minute.

You can customize these programs to tailor the offerings so they best fit employees at your organization.

Feel free to reach out to start the conversation at benefits@upwards.com.

We can help you decide on employee childcare benefits that don’t just look good on paper but in fact work in practice to help solve the real childcare needs of your working families.