What Companies Are Doing About Child Care

With more women in the work force, companies are offering a wide range of benefits

Tweet

Approximately 2,300 employers, excluding hospitals, now give some type of child-care assistance. The benefits can range from supplying information on how to evaluate child-care providers to actually setting up a company day-care center. Here are some of the options in between.

* Consortiums, in which several companies pool their resources, may be the wave of the future. Companies can band together to set up a day-care center for their employees, and at the same time be free from the responsibility of running the center and from potential liability. They do this by setting up a separate entity, often a not-for-profit, and contracting out the management.

* Resource and referral is one of the more popular child-care services. Companies pay a tax-deductible fee (which can range from $4 to $15 per total number of employees, or from $60 to $100 per referral) to a local agency that keeps tabs on day-care centers and family-care homes in the area. Employees then deal directly with the resource-and-referral agency which helps them locate the child-care centers that are most appropriate to their individual needs.

* Salary-reduction plans are the most common, and least expensive, form of financial assistance. Employees can put up to $5,000 per family aside -- in pre-tax dollars -- which they then draw on in the course of a year to be reimbursed for child-care expenses.

* Reimbursements to help out with the cost of child care are provided by fewer than 150 companies. These tax-deductible payments either can be paid to the child-care providers directly, or the employees can be reimbursed for an agreed-upon amount.