Clothing retailer Patagonia offers a host of enviable employee perks: It encourages employees to work flexible hours, has an onsite employee café and free yoga classes, and famously allows employees to head out of the office during the workday “when the waves are good and the winds are right.”

But its most meaningful benefit might be the company’s onsite childcare center, Rick Ridgeway, Patagonia’s vice president of public engagement, said last week during the Society for Human Resource Management’s annual conference in New Orleans.

“Patagonia started [in 1973] as a family business, and we are still a family business,” he said. “We want to have benefits that support women and children and families … and it’s amazing how much our employees value this.”

[Image credit: Bloomberg]
[Image credit: Bloomberg]

Employees have access to onsite childcare at Patagonia’s headquarters in Ventura, Calif., and at its Reno, Nev., distribution center. Patagonia fronts 25% of daycare costs, while employees pay 75% of the costs of services; subsidies are available for some employees. Employees can visit their kids during lunch breaks or go tuck them in for a nap. Nursing moms are even alerted by the daycare if their children need them, Ridgeway explains.

“It’s beyond unfair to ask a new mother to choose between having a job and spending time with her child,” he said. “It costs us a lot to provide [onsite childcare], but we get so much return on employee retention and engagement.”

Though the childcare center costs the company about $1 million to operate, Patagonia estimates it gets a “little over 90% back in quantifiable returns.” The company gets 50% recouped in tax credits — the government grants qualified childcare programs a yearly tax credit of $150,000 and allows the company to deduct 35% of its unrecovered costs from its corporate tax bite. More importantly, Ridgeway said, Patagonia estimates it gets about 30% of costs recouped in employee retention — about 95% of the company’s new moms return to work after maternity leave — and gets another 11% back in employee engagement.

“Another benefit is the higher rates of employee recruitment,” Ridgeway said. “We have a lot more people applying because of these policies.”

In addition to onsite childcare, the company offers a number of other family-friendly perks including private onsite lactation rooms, financial support for childcare, adoption assistance, 16 weeks of paid maternity leave and six weeks of paid paternity leave.

“It’s astonishing — and a little embarrassing — that our country’s business leaders provide paid leave to just 13% of workers and just a fraction provide onsite childcare,” Ridgeway said.

He called on HR and benefits managers in attendance to take steps to change that.

“Even starting small, with something like lactation rooms, is a really good first step,” he said. “It starts to shift the culture and you can see the results.” In fact, lactation rooms are among the benefits on the rise in 2017, according to SHRM’s annual benefits survey.

“We are hopeful — and a little more optimistic — other organizations might [step up and offer family benefits],” Ridgeway said.

“When your family life and work life meld together, it becomes the foundation of your culture,” he said. “It’s a business model that’s super successful.”

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