Is backup care worth the investment? <!--sponsoredarticle-->

Backup child-care, elder-care programs face trials of logistics, costs, usage

KPMG has been offering backup child care and elder care to its 5,000 employees for more than two years. The Toronto-based accounting and consulting firm pays an annual fee, and top-ups to hourly fees, to guarantee care is available if needed, while employees pay for usage, for up to 80 hours of care per year.

“It’s a way to facilitate and help (employees) manage the demands of their work and personal life,” says Geri Markvoort, director of total rewards at KPMG. “It differentiates us and it’s particularly pertinent for our demographic.”

Employees rest easy knowing there is support in case of an unexpected illness or after-hours work, and KPMG is seen as a supportive employer helping with work-life balance. But only about five per cent of KPMG’s workers have taken advantage of the program and the target was 10 per cent, says Markvoort. So the company plans to look into the issue further with employees and the backup care provider.

When it comes to usage, “a lot depends on the company and how much it can message to employees and how well employees hear the message,” says Victoria Sopik, president of Markham, Ont.-based Kids & Company, a backup care provider.

This service is popular with professionals in law, accounting, financial institutions and the oil and gas industry, she says. It’s not about dealing with employee overtime, “but being the best possible employer and offering as many things as your employees could potentially use. They have an arsenal of things, pensions or benefits or sick days, and this is just one of them.”

With on-site daycare, a company is limited in how many employees it can help while backup care is far more equitable, says Sopik.

“Having a solution in place, just knowing there’s a plan, even if it’s only (used) two times a year or never, really takes away anxiety from a working parent, so the peace-of-mind aspect is huge,” she says. “We all know if you have an issue or concern with family or children, you’re really not productive at work, it’s always hanging over your head.”

Kids & Company’s backup care is either on-site or trip-based for kids five and older. Employees of corporate clients can call in the morning to make arrangements. The cost is $10,000 per year for organizations for national coverage (or $5,000 for one city), for both backup child care and elder care, she says, and while that’s obviously significant for one person, it’s a small price to pay to retain and support employees. Employers or employees then pay per use, either with the company paying fully or partially per employee or per child.

Or there’s an insurance-based model, where employees can pay, for example, a lump sum of $350 per year for up to 20 days.

Toronto-based architectural firm HOK started offering backup child care and elder care as a benefit more than one year ago, through Kids & Company.

“There are a number of people (here) with young children or aging parents. I have a five-year-old and just the fact it’s there and you know you can get support eases your mind,” says Lui Mancinelli, senior vice-president and managing principal of HOK in Canada.

Several hurdles

But there are still several challenges to successful backup care in Canada. Justifying the expense depends on the model, says Nora Spinks, president of Work-Life Harmony Enterprises, a Toronto-based research and consulting firm. For example, if a school board is using backup care and a teacher doesn’t show up because she has to take care of her own child, the school must still pay for a substitute teacher. In that situation, the advantage of having backup care can be easily calculated by the school board. For another type of full-time position, the math isn’t as easy.

“In the U.S., the biggest users of backup child care are professional services, with billable hours and hard-to-replace employees, which is less connected to the size of the organization than the nature of the business and how revenue is generated and people are paid,” says Spinks.

There are only two major players in the country providing backup care, Kids & Company and Watertown, Mass.-based Bright Horizons, while many more have failed, she says.

“It’s a complex set of issues involving every layer of government, employers, employees, community organizations, parents, grandparents,” she says. “The thing with short-term or emergency child care and elder care is it’s very expensive to deliver because it’s very challenging to manage.”

And one of the lessons learned over the years, as backup care struggles to find a place and economic base in Canada, is sick kids need and want to be with somebody they know and love, and parents want to be with their sick children, says Spinks.

“You can’t force somebody to leave a child in a program just because you sponsored it,” she says.

Also problematic is the tax side — if an employer pays all or part of the daily fee, it’s deemed a taxable benefit, but if the child care is on-site and exclusive for employees, it’s not taxable.

Then there’s the issue of holding spaces for potential kids when there are waiting lists.

“From an operator’s perspective, when spots are empty, is it fair for those who need it full-time, everyday, to be shut out?” she says.

Elder care even harder

If child care isn’t difficult enough, elder care is “hugely more complicated,” says Spinks, and going through exactly the same growth and learning. That means dealing with issues such as the right model, in-home or out-of-home care, and health-care costs. And again taxable benefits are an issue, she says.

While child care involves parents making decisions about their child, they don’t have the same say when it comes to an elderly parent. And there are complexities such as travel and transportation, sibling rivalries and family histories.

“It’s going to get bigger, so we have to figure out some solutions,” she says. “Increasingly employees are becoming much more family-centric so they’re going to expect employers to work with them to address these issues.”

Elder care is more challenging because the center-based model does not work, says Sopik. Kids & Company works with a health-care organization to provide two types of elder care: In-home care with support workers, which includes meals, companionship or appointments, and nursing, which includes recovery care, medications or assessments.

The costs are about $20 per hour for personal support workers and $50 per hour for nurses, depending on the service.

Another alternative to the whole dilemma is simply to provide greater flexibility to employees, from working at home to flex hours, says Spinks. But demand for backup child care will continue to grow, because one-third of the workforce are first-time grandparents, too busy to help out, and more employers are trying to retain older workers.

“The model’s going to get better, we get smarter every year,” she says. “The challenge is that anything related to families, children, lives, illness, injuries, emotion, death, dying is very complex and it’s impossible to find one simple solution that meets the needs of everyone, all the time, everywhere.”

To read the full story, login below.

Not a subscriber?

Start your subscription today!