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Why Companies Should Invest in Employee-Parents for Better Retention

Employers and companies are already suffering due to the costs of losing post-maternity employees; finding a replacement, training them, bringing them up to speed
Why Companies Should Invest in Employee-Parents for Better Retention
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CEO, Workspace
5 min read
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India’s dynamic and ambitious workforce is finding balancing work and family hard. Indian employees have, on average, 52 hour workweeks, estimated to be the highest in the world. Changing societal norms have led to many more families where both parents are gainfully employed, causing greater concern amongst employees about how their children are being taken care of. The progressive decline of the joint family system, and greater awareness of the harms of raising children through domestic help have clearly brought to the fore the needs of parents who are employees looking for effective solutions. 39% of Indian employees who are parents indicated that managing their family and work simultaneously had become more difficult over time. These concerns have a tangible impact upon employee retention – in the United States, 43% of qualified working women professionals are leaving careers, often due to maternity and child-rearing related concerns. It would be surprising if that percentage was not substantially higher in India.

The Problem

Employers and companies are already suffering due to the costs of losing post-maternity employees; finding a replacement, training them, bringing them up to speed. The productivity loss associated with this is expensive. Companies are estimated to lose somewhere in the range of INR 10-60 lakh per maternity case in India, depending upon the employee’s seniority, in dealing with the cost of replacing them. Certain companies that are reputed for their hard-nosed approach, have also provided an on-site office creche in their offices. A female managing director at a company stated that there was nothing more stressful than worrying about childcare – an easily understood emotion for any parent leaving their infant child at home while heading to work. For these and other good reasons, the Indian government recently legislated a new maternity benefits law to make it mandatory for companies having over 50 employees to provide creche facilities at their offices.

The Benefits

Having an on-site creche is extremely useful for employers. In Patagonia, a company in Ventura, California, the provision of an on-site daycare facility improved employee retention by 25%, and a 100% of post-maternity employees returned to work at the company. Clif Bar, another US-based company, found that 98% of employee parents whose children attend the company day care were more likely to continue working at the company because of the daycare center. Further, reliable in-house creches improve employee attendance, as parents are less likely to take days off to take care of sick children and are less likely to fall sick themselves if childcare is removed as a stressor for them. Employee parents are more focused and productive at work, making fewer calls to their children during work. Employees that know their children are safe and well taken care of are likely to have higher morale, leading to higher employee retention and loyalty.

For employers, providing this facility is an exceptional competitive advantage. As India’s current crop of new, driven, technology-savvy employees get older and start having children, an employer providing on-site child care would help them gain the required peace of mind and security that would make them leading performers and achievers in the company. Employees will only work their best when their home life is taken care of, and an on-site creche is the best way of ensuring that for employee parents of young infants.

The Solution

Most employers would be understanding of the needs of young parents who work for them. Taking individual days off or unscheduled leaves wouldn’t be completely off the table. However, they would expect that their employees to ‘get the job done’. The kind of dedication and single-mindedness it takes to get a job done properly, meticulously, and as effectively as employers hope cannot sustainably occur when parents are worrying about their children being fed and nurtured in a caring environment. An on-site creche provides the perfect solution, as employees would have the peace of mind and easy access to their children, while being able to concentrate on their work, delivering high value to their clients by working better and harder.

For most companies, the high costs of providing such centers would act as a strong disincentive. The benefits to productivity this would be likely to provide, would seem too remote. Further, managing such a center – logistical costs, maintaining capacity, hiring specialist caretakers for infants – would add layers of complexity to an already difficult choice. Those companies with over 50 employees, in anticipation of the enforcement of the new maternity benefits law, would already be scrambling to find nearby creches for their employees. Once the law is applied, employers with less than 50 employees would face a comparative disadvantage to their larger counterparts; it would be better for them and all employers to consider taking up space with serviced office. These companies are providing state-of-the-art offices, full of various amenities – including well-designed and staffed creches – that can provide the perfect work environment for today’s ambitious Indian workforce.

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