Should Elder Care Benefits Be Part of Employees’ Compensation?
As our parents cared for us, we must eventually care for our parents. As the number of elderly individuals in the United States has grown, so has the demand for caregivers. Often a child or children will take on this role as their parents age, and more than one in six Americans working full- or part-time act as caregivers in some capacity for a disabled or elderly family member.
Of that one in six, roughly half indicated that they have no option but to take caregiving responsibilities on themselves. Employees don’t want to tell their employers for fear that it could affect their career growth, or simply because they want to prefer privacy.
Under the federal Family and Medical Leave Act (FMLA), employers must provide “family leave for seriously ill family members.” However, FMLA is not an ideal solution because the “family leave” it requires employers to provide is unpaid leave and accompanying protections from retaliation or discrimination on account of the use of leave. Family members are also limited under FMLA to spouses, children, or parents.
Employers offer a variety of options to fill the gap between unpaid FMLA leave and the significant demands of caregiving. In its article, “Elder care benefits: A growing need for the U.S. workforce,” Benefits Pro set out several categories of benefit plans employers may provide.
An employee assistance program (EAP) provides elder care educational and referral services for employees and members of their households. EAPs may include short-term counseling, follow-up services, and free and confidential assessments.
A Dependent Care Assistance Plan (DCAP), also known as a “daycare benefit,” gives employees the option to set aside a portion of their paycheck to be used for qualified elder care and accordingly not taxed. DCAPs don’t fully cover elder care, but they can lessen an employee’s federal tax burden and care costs. They often provide up to $5,000 per calendar year in assistance.
Respite care gives the caregiver a brief rest from caregiving. It pays for a professional caregiver to step in for a short period of time (from half a day up to a few days) to give an employee-care-giver a brief respite from their duties as care-giver to simply rest or to take care of other responsibilities which may have been pushed to lower priority.
Studies have shown that employees who are acting as caregivers have approximately 18.5% reduced work productivity and an increased chance of leaving their employer. When an employer offers elder care benefits, employees work more efficiently and stay with positions longer, while employers avoid turnover costs which can exceed a year’s salary of the replaced employee.
Elder care benefits make sense for companies, employees, and families. Speak to your employer now, so that if you need these benefits you are ready to make an efficient plan.
Reference: Benefits Pro (April 30, 2019) “Elder care benefits: A growing need for the U.S. workforce”