Ask the Right Questions!
Updated: Feb 7, 2019
With the impending arrival of Brexit, and the uncertainty many of us face, it’s no surprise that the subject of childcare costs has gotten a little lost. I guess government and companies have larger fish to fry, but it doesn’t mean we have to pause this conversation.
Companies are already incurring expenses trying to figure out the plan, post Brexit. Simultaneously, the government is spending large amounts of monies trying to put in place a plan of action. Nonetheless, companies still need to operate, to recruit and most importantly, attract highly skilled candidates in an oversaturated market.
Companies that don't already have childcare benefits in place should see that there is a real selling point. Offering to cover childcare costs could get you that star candidate, and help them to choose one company over another.
Until the government is ready for policy change (and this may take a while), companies can help employees with childcare costs in two ways without incurring additional costs:
By offering employees a taxable allowance for an amount equivalent to the gross salary of the nanny, creche or nursery. Many people don’t know this, but they can ask their employers to pay the nanny or nursery directly, on their behalf. That payment is a taxable allowance with no P11 liability attached to it. It saves NI for the employer and allows for better value for money.
Secondly, companies can also help with childcare costs by offering an accrual account in which a part of the employee’s salary is put into a separate account. Once the employee has their first child, he or she can start withdrawing funds from the account to cover childcare costs. It would be for the company to decide if matching contributions are available. Monies would not be transferable from company to company. The accrual account would have to be built within the employee’s contract and returned to the employee when leaving the company.
Crazy that all of this is available to us, but many have no idea, right? We urge you to go and ask! Don't be afraid.
Start off with asking, “can I have part of my salary paid directly into the nanny, nursery or accrual account?”
With time, companies will offer it rather than candidates asking for it.
If you would like us to talk to your company about implementing these benefits, please do get in touch.