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What does Jeff Bezos know about backup child care that we don’t?

Early in 2019, a group of thousands of moms who worked at Amazon, calling themselves the “Momazonians,” began a movement. Their single purpose: to persuade Jeff Bezos that backup child care was good for business and should be offered to Amazon employees. Amazon resisted, citing numerous other benefits offered to parents, including “comprehensive fertility benefits, […]

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momazonians

Early in 2019, a group of thousands of moms who worked at Amazon, calling themselves the “Momazonians,” began a movement. Their single purpose: to persuade Jeff Bezos that backup child care was good for business and should be offered to Amazon employees. Amazon resisted, citing numerous other benefits offered to parents, including “comprehensive fertility benefits, memberships and discounts for child care services, and flexible parental leave programs.”  

But in June 2020, as parents everywhere began to buckle under the strain of the world’s biggest child care fail — and Amazon itself scrambled to make 175,000 new hires in a matter of weeks — they relented. On June 2, 2020, Amazon announced that they would offer 650,000 full and part-time permanent U.S.-based employees at Amazon and Whole Foods up to 10 days of subsidized childcare — but only temporarily, until October 2 (today).

Why was Jeff Bezos so reluctant to add a benefit already offered by most of the top technology companies in the country even before the pandemic?

What is backup care, anyway?

Backup care is a general term used to describe a benefit that employees can use when a family care obligation — whether involving kids (most common), elderly relatives (also pretty common) or any other dependent family member — would otherwise take them away from work. Backup care options can be center-based (think drop-in daycares) or in-home (think babysitters, nannies or in-home elder care providers).

Most of the time, when family life threatens to interfere with work, the employee is on his or (more commonly) her own to figure it out — or bear the professional consequences. This is why some say that the so-called gender pay gap is actually the motherhood pay gap — because it’s usually moms whose work suffers (or is perceived to suffer) when family care issues arise.

Do many employers offer backup care?

Perhaps because this has been primarily a female issue for so long, there has been very little movement on the part of employers toward solving the problem. Many cite it as one of the primary things employers could be doing to promote gender equality in the workplace — and to support workers during this pandemic.

But employers like Jeff Bezos are in a tough position. As compared with other benefits, there are very few options for providing employer-sponsored backup care. To put it in perspective, the Society for Human Resource Management (SHRM) lists over 200 companies that provide payroll services, compared with only three or four companies that can credibly offer backup care services. And the few providers that do exist are so secretive about their pricing and availability that it’s hard for employers to know whether providing backup care as a benefit is a viable option for them at all.

If I want my company to offer backup care, what are my options?

To get a better understanding of this market — as an employer myself but also as the CEO of an on-demand child care app looking at this space strategically — I’ve studied existing backup care options extensively. I’ve even done a little bit of sneaking, to pierce the veil of secrecy around the business and pricing models of the top industry players. Today I’m sharing what I’ve learned, in hopes that it gives employers, human resource professionals, and benefits specialists the data they need to bring backup care to their organizations in some form — and that it gives employees like the Momazonians the data they need to make a slam-dunk case to bring to the powers that be.

So, without further ado, here’s a rundown of the options currently available.

Bright Horizons

Bright Horizons calls themselves the largest provider of employer-sponsored child care, and I believe them. They’re a publicly traded company, with ten times the revenue of Care.com, and have been around since 1986. The biggest part of their business is their network of child care centers throughout the United States, where they provide ordinary daycare and also center-based backup care in the form of “drop-in” centers. They’ve more recently added in-home backup care options, primarily through their acquisition of College Nannies & Tutors in 2016 and of SitterCity earlier this year.

Their packages for employers generally involve a significant up-front prepayment for a certain number of anticipated “uses” that work out to cost about $300 per “use” (whether care is “used” for two hours or 10). Unused “uses” don’t roll over, but if the employer’s employees use MORE than the allotted number, extra charges do apply. (I can only imagine how that played out this past spring, during the height of the pandemic.)

Bright Horizons generally fulfills requests for at-home care by partnering with local nanny agencies, who take care of the vetting, sourcing, and logistics of fulfilling the requests for care — and of course, take a cut of the revenue, leading to the ultra-high price tag. For companies ready to lay out $100K or more per year for the oldest brand in the industry, this is the top choice.

[email protected]

[email protected] is Care.com’s take on the Bright Horizons model, and operates pretty similarly. Like Bright Horizons, [email protected] fulfills care requests through partnerships with local agencies — not through their Care.com online marketplace (which is a good thing, given all the safety and quality issues they’ve had with said online marketplace). Like Bright Horizons, [email protected] charges a huge, non-refundable annual contract fee that is essentially a prepayment for all the care the employer’s employees might need throughout the year. While they don’t own any physical centers (that I know of), in 2018 they purchased a nanny agency in California called Town + Country. Like Bright Horizons, [email protected] is a safe bet when your goal is to send the message to your employees (and the world) that you’re taking backup care seriously. But, like Bright Horizons, [email protected]’s dependency on nanny agency relationships means service availability depends entirely on the existence and/or reliability of the local agency partner.

Nanno

Originally built to connect parents and sitters for on-demand babysitting, Nanno boasts a national network of thousands of sitters and nannies available on demand. Nanno provides a variety of backup care solutions, and is the only company that offers solutions for small and mid-sized businesses, including an employer-subsidized pay-as-you-go plan as well as a fully subsidized prepaid plan that offers the same benefits as Bright Horizons and [email protected] but at a fraction of the cost. Because Nanno operates essentially like Uber, using technology to make instant connections between parents and sitters, finding high-quality care is immediate and far more affordable than any of the alternatives. At the same time, Nanno is a startup, as opposed to a legacy player in this industry, so doesn’t hold the same name-brand cache.

Nanny Agencies

If Bright Horizons and [email protected] are both working with nanny agencies to source care, why can’t employers skip the middle man and do the same? If all (or most) of their employees are located in a single metro area, they certainly can. Most agencies offer backup care solutions and are eager to partner with employers directly. If they already work with Bright Horizons or [email protected], you can trust that they have appropriate insurance and vetting processes (which both companies screen for). A great resource to find an agency to partner with is the Association of Premier Nanny Agencies (APNA)’s member directory. Or, if you’re interested in a more tech-focused spin on the traditional agency model, check out eNannySource or Helpr.  Pricing plans and structures will vary from agency to agency, but many agencies these days have surprisingly sophisticated technology and offer more than traditional placement services.

Employee Assistance Programs (EAPs)

Employee assistance programs (EAPs) are employer-provided benefits to help employees with personal things — everything from mental health, wellness, and substance abuse issues to adoption assistance and help finding elder care. EAPs have been around since the 1930s (originally intended to address occupational alcoholism), so it’s both surprising and unsurprising that few of them tackle child care in any meaningful way. Two significant exceptions are LifeCare, which provides an array of services geared toward parents, and Cleo, a new EAP-like platform geared entirely toward working parents that has recently partnered with UrbanSitter to create CleoCare (still in pilot phase). Both of these services operate more as referral platforms than direct providers, and both specialize in high-touch, concierge service as opposed to technology enabled backup care.

Conclusion

While it’s not as easy to find and set up backup child care as it is for most other employee benefits, it’s not impossible. Though the pool of options is small, there is enough variety to address relevant variables like the size of your company and team, the number of parents versus non-parents, your location and your budget. As employers become ever more attuned to the impact of child care fails on their workforce, expect to see the offerings in this space continue to grow and, hopefully, improve.

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