Workplace Day Nursery: Benefits and How to Set One Up for Employees

Workplace Day Nursery: Benefits and How to Set One Up for Employees

In today’s rapidly evolving business landscape, employers face significant challenges in persuading employees to return to the office. With the rise of remote work, city centres have become eerily quiet, with Savills reporting only 57% office occupancy across the City of London in November 2024 - the vibrant workplace culture we once knew has taken a backseat.

This shift has left many companies grappling with low office attendance and the implications it carries for team collaboration and company culture. A promising solution to this predicament lies in the establishment of workplace day nurseries, a strategy that not only addresses the childcare needs of working families but also serves as a compelling employee benefit that addresses the principal cost that working families have to bear in London. To see those depressing costs in full, check out our blog on the Returning to Work and to see how much we could save via the WPN, read on!

The Challenge of Returning to the Office

The pandemic has irrevocably transformed where and how we work. As companies seek to bring their employees back to the office, they are met with resistance. A survey by Microsoft in 2022 revealed that 73% of employees desired flexible remote work options, while 67% of employees wanted more in-person work or collaboration post-pandemic. However, the reality of returning to a full-time office schedule feels daunting for many. Companies like Apple and Google have attempted to mandate staff to return to work, only to face backlash and even threats of mass resignations. A report from The New York Times highlighted that nearly 40% of employees would consider leaving their jobs if their employer insisted on a full-time return to the office.

This resistance to returning to the office isn't merely about the desire for flexible work locations; it's also significantly influenced by the costs and logistical challenges associated with childcare. For many working families, the expense of childcare remains a substantial financial burden, often consuming over £20,000 per year for each child from their net household income - that is over 30% the median (joint) household income in London.

Introducing Workplace Day Nurseries

Enter the concept of the workplace nursery—a solution that not only alleviates the financial burden on working parents but also serves as a powerful incentive for employees to return to the office. A workplace day nursery is childcare facility either on site or at a provider near by that is financed by the employer via corporation tax deductible commitments to provide their teams with the support they need. Employers can choose to either have their teams pay all, part or none of the fee via a salary sacrifice that reduces their taxable salary for PAYE or employers NICs purposes; or cover the whole cost of the fee via a corporation tax deductible payment for each place. Our research suggests that with childcare costs covered, over 90% of workers indicated they would be willing to return to the office full-time. This is hot off the back of reports from People Management Today that over 40% of employees have thought about quitting because of a lack of access to affordable childcare, making this the only employee benefit that both pays for itself and answers the financial needs of your teams

Benefits of a Workplace Day Nursery

1. Cost Savings for Employees: By offering on-site childcare, employers can potentially save their employees up to £20,000 per year per child. This reduction in childcare expenses can lead to increased employee satisfaction and loyalty.
2. Improved Employee Productivity: With a workplace nursery, parents can focus more on their work, knowing their children are in close proximity and cared for. This reduces stress and enhances concentration, leading to higher productivity levels.
3. Enhanced Company Culture: A workplace nursery fosters a family-friendly company culture, where employees feel valued and supported. It encourages collaboration and engagement, bridging the gap between professional and personal commitments.
4. Attracting and Retaining Talent: Offering unique employee benefits such as a workplace day nursery can set a company apart in the competitive job market. It can be a significant factor in attracting top talent and retaining existing employees.

Setting Up a Workplace Day Nursery

Establishing a workplace nursery requires careful planning and collaboration with experienced partners. Here’s a step-by-step guide to help employers navigate the process:

1. Assess the Need

Begin by conducting a survey among your employees to gauge interest in a workplace nursery. Determine the number of employees who would benefit from childcare that is either on site or nearby and assess their specific needs. Understanding the demand will help you make informed decisions about the size and scope of the facility. If you'd like us to do this for you, we have a standard survey that  HR Teams can leverage to assess internal demand, but with 5.6% of the working age population having children under the age of 5, you can calculate how many of your teams would qualify for and be interested in this support

2. Identify Space and Resources

Work with a local provider that is close to your place of work to identify either space capacity within their schools or a new space close to the office that they can operate from - with the abundance of commercial property being what it is, finding space that is either surplus to your current office footprint from the internal demise, or space outside will not be a problem, and with the planning reforms of a couple of years back, nurseries now just need to be commercial class E, like everything else - no change of use is required.

3. Choose the Right Partner

Collaborating with experienced providers is crucial to the success of your workplace nursery. Consider partnering with companies like Hatching Dragons, a leader in bilingual nursery education, known for their innovative workplace nursery schemes. Hatching Dragons collaborates with staff benefits providers such as Yellownest, Enjoy Benefits, and Kinsail, offering a comprehensive solution to activate and manage workplace nursery programs.

4. Design the Nursery

Work with your chosen partners to design a vibrant and nurturing environment for the children. Consider the layout, furnishings, and educational resources needed to create an engaging and safe space for young minds to thrive. You can find our architectural packs and design ethos on our web pages

5. Develop Policies and Procedures

Establish clear policies and procedures for the operation of the nursery. This includes enrolment processes, health and safety protocols, and guidelines for parents and staff. Ensure compliance with relevant childcare regulations and standards.

6. Hire Qualified Staff

Recruit and train qualified early childhood educators and caregivers to provide high-quality care and education. Look for individuals with experience in childcare and a passion for nurturing young children. Check out our own staff profiles for Westminster, City of London and Canada Water to establish a benchmark to the quality of staff you should aspire to have. Ours are drawn from Montessori, Steiner, High Scope and Reggio disciplines

7. Promote the Benefit

Communicate the availability and benefits of the workplace nursery to your employees. Highlight the cost savings, convenience, and positive impact on work-life balance. Use internal communications, meetings, and workshops to engage employees and encourage participation.

Real-Life Examples and Success Stories

Several companies have successfully implemented workplace nursery schemes, reaping the rewards of enhanced employee engagement and loyalty. For instance, Deloitte’s workplace nursery in their London office has set a benchmark for integrating childcare solutions within corporate environments. The initiative has been praised for not only supporting working parents but also contributing to a more inclusive and diverse workforce.

Another notable example is the workplace nursery program at IBM, which has been instrumental in attracting and retaining top talent. The program has been lauded for its positive impact on employee morale and productivity, proving that investing in childcare solutions is not just a moral imperative but a strategic advantage.

What else Hatching Dragons does to help our Families Reduce Costs

Hatching Dragons Nursery is committed to supporting families in managing the financial demands of childcare through a variety of innovative discount and subsidy schemes:

1. Workplace Nursery Scheme - an employee benefit in which your employer pays for childcare from your pre-tax income, reducing your PAYE and their employers NICs. We've saved some families over £10k on this measure alone. See further details on Enjoy Benefits, Yellownest, Kinsail and Mintago
2. 15-30 Hours free Childcare - 15 or 30 hours of childcare 38 weeks / year are funded by the local authority for children aged 9 months to 3 for eligible families and for all 3-4 year olds. Check your eligibility here
3. Universal Credit - 85% of your fees are repaid by Universal credit for qualifying families up to a cap of just over £1000 a month. See here for more information
4. Student Childcare Grants - 85% of childcare costs are covered by Student Finance for full time students. Read more here
5. Tax Free Childcare - HMRC will top up any contributions made by qualifying families to their childcare tax account online with a 20% payment, up to an annual contribution of £2000 a year. For more information, click here
6. Public Sector Discounts - of up to 50% for those working in charities, the civil or public sector or government
7. Referral Discounts - 5% off for 6 months for every family you recommend, uncapped by the number you do.
8. Sibling Discounts - 5% off for any sibling that enrols
9. Advanced Payment - up to 10% off for families who pay down in advance

And we allow many of these discounts and subsidies to be bundled together to maximise your savings with us

Why not book in a visit at one of our schools to discover how we can help you?

Conclusion

In a world where flexibility and employee well-being are paramount, the workplace day nursery emerges as a compelling solution to the challenges of returning to the office. By addressing the principal cost that working families bear—childcare—employers can transform the return-to-office experience from a mandate to a meaningful choice.

As city centers begin to buzz again with the energy of returning employees, investing in a workplace nursery is more than just an employee benefit; it's a testament to a company's commitment to its people. With the right partners and a well-executed plan, setting up a workplace nursery can be a seamless and rewarding process, fostering a workplace culture where both parents and children thrive.

By embracing this innovative approach, companies can not only alleviate financial burdens but also cultivate a loyal, productive, and engaged workforce ready to contribute to the future of work.