Offering On-Site Childcare is a Great Perk. Consider the Risks First.

February 2022

by Dena Johnson, PayneWest Insurance

As Billings companies work to reimagine ways to attract and retain talent, the race is on, and the conversation is broader than a traditional benefits package. Offering on-site childcare can be a real game-changer for employers. Still, before they make the proverbial leap, employers need to understand what risks come with it.  

Daycare Needs by the Numbers 
  • According to the US Bureau of Labor Statistics, 2/5 families have at least one child under age 18.  
  • 64% of those families have both parents employed (30 million families).  
  • 10 million working single mothers and 5 million working single fathers.  
  • 14 million Americans are caring for a child with special needs under the age of 18, and 23 million kids under age 5, half of whom are in daycare.  

According to a July survey by the National Association for the Education of Young Children (NAEYC) of the more than 5,000 childcare providers across the US, America needs to act quickly to bolster its daycare system. Only 18% percent of childcare programs believe they will stay open without public assistance. Costs for existing programs are going up, increasing the burden for parents deciding how to both work and afford childcare. And for those who have a choice and want the best for their children – what does the best look like?  

Karen Baumgart-Miller, Director of Strategic Advancement at St. John’s United, is proud that they are one of a handful of organizations in Billings offering on-site childcare. She touts the program’s ability to attract and retain talent that may not have initially considered the company, including her personally. She adds that it isn’t just access to care – but also the quality of the programming provided. While Billings has several outstanding childcare services, most are at capacity or are not financially feasible for some family budgets.  

Is an on-site daycare right for your company? Consider these steps: 
  • Become licensed or work with a licensed contractor with the State of Montana as a childcare provider. 
  • Create a written mandatory reporting policy for the suspicion or knowledge of a child being abused or neglected. 
  • Complete background checks for all staff working with children. 
  • Ensure food safety training and policies are in place. 
  • Establish COVID-19 protocols (written and followed). 
  • Create a written employee handbook (specific to the childcare center). 
  • Offer the program only to employees. 
  • Establish a separate operating entity for the childcare center (under legal counsel). 
What type of insurance is needed to add on-site childcare for your business?  

It’s important to note that businesses do not automatically have coverage within their existing policies, as many carriers have limitations and exclusions that prohibit childcare. Additionally, the type of coverages unique to managing risks associated with childcare – such as professional liability, abuse liability, and others - are typically not part of a standard program. Insurance brokers/agents can (with an underwritten and approved application) add a customized program that does protect the business. Each agency is unique, and businesses need to consult with their provider. 

What are the best resources for considering and establishing on-site childcare? 
  • Consult with a knowledgeable business attorney, CPA, and business insurance professional.  
  • Work with local resources like the Billings Chamber of Commerce and Big Sky Economic Development to determine your company’s needs and how to get started. 

Originally printed in the February 2022 issue of Simply Local Magazine

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