Challenges

Access, Worker Issues

Location

California, Pennsylvania

Stakeholders

Businesses

Beneficiaries

Parents, Children, Childcare Providers

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Overview

Global logistics company UPS implemented a backup childcare benefit pilot in 2022, providing its employees with access to emergency or short-term childcare when their regular arrangements fell through. The popularity of the program led UPS to expand the backup care benefit to more employees.

Key Impact Metrics

  • 32%
    reduction in employee turnover among the pilot group
  • 80%
    of eligible employees participated in the pilot program

Problem

UPS employees, such as warehouse sorters, drivers, operate with tight scheduled shifts where an unexpected absence can disrupt operations. Many UPS employees rely on an ad-hoc support for childcare—e.g., a relative as backup. When this support fails, employees face the possibility of missing work at the last minute. UPS faced a high turnover rate—about 36% in some roles—partly attributed to the stress and unreliability for working parents who couldn’t juggle last-minute childcare needs.

Solution

In partnership with Patch Caregiving, a childcare provider, UPS launched a six-month pilot program offering emergency childcare to employees in its Northern California facility. They sought to limit all barriers to using the new service. To make it accessible, UPS set up a text message system through Patch Caregiving where employees could request backup care on the day of. The service targeted frontline workers, such as package handlers and drivers, who often face scheduling conflicts due to non-traditional work hours. UPS expanded the program to include additional shifts at the pilot site. The program has also been expanded to additional locations in Pennsylvania.

Results

  • Beneficiary ImpactEmployee turnover reduced from 36% to 4% and $5 – $25 copay offered to employees
  • Employee ImpactEmployee retention for eligible hourly employees at the facility increased from 69% to 96% and 120 unplanned absences prevented
  • Financial Results$675,000-$2.4 million saved in turnover cost based on industry estimates

Replication Tips

  • Make it easy to use: The success of backup care lies in ease and speed.  Replicating organizations should provide a 24/7 hotline or app where employees can request care at a moment’s notice.
  • Pilot and measure results: If a company is unsure, create a pilot in a high-need area, track turnover and absentee rates vs. a control group. Use that data to build a business case internally.

Suggested Implementation Timeline

~4-6 months

Sources