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At D&S Dental Laboratory in Wisconsin, President Dick Pilsner, CDT, has extended the idea of a family-friendly work environment to include an on-site daycare center for employees' children.
Although it's not something they can admit aloud, many laboratory owners and managers are dismayed when they learn that an employee is pregnant. In these technician-tight times, the potential for losing a technician for even a short maternity leave can be debilitating to a laboratory's workflow.
Yet pregnancy has become a cause for celebration at D&S Dental Laboratory in Waunakee, Wisconsin, thanks to the addition of an on-site daycare center. Opened in June 1998, the 2,400-sq.-ft. center is open to children and grandchildren of the laboratory's 80 employees as well as to members of the community. Currently, 24 children-infant through kindergarten ages-are enrolled and the center has become so reputable that there is a waiting list of 82. Laboratory President Dick Pilsner is in the process of expanding the facility to 7,000 sq. ft.
Initially created as a retention tool for his employees-18 of those enrolled are children of employees-the daycare center has also become an excellent recruiting tool. Since June, Pilsner has hired three new employees from other areas of the country and one of the attractions was the laboratory's daycare program.
LMT first reported on Pilsner's desire to open a daycare center in its March 1997 issue, How to Hold on to Key Technicians. Now we share how his goal came to fruition.
LMT: Dick, what was the impetus for starting a daycare center at your laboratory?
Pilsner: Meeting our employees' needs was the driving force behind our decision. We have a 1.3% unemployment rate in our area so keeping employees happy is an important goal in our laboratory. I realized there was a tremendous need among the employees for daycare assistance and we weren't offering any dependent-care benefits.
LMT: Tell us about the process of starting the center and the research that went into it. Were there any zoning variances required or any other "red tape" issues to be dealt with?
Pilsner: Our first step was to research the projected operating costs of a daycare center to determine if it was feasible. We knew the going rates for teacher's salaries and daycare in our area, but we had to learn the county and state regulations to become a licensed facility.
The age group that we would enroll became a key consideration. Our state mandates a one-to-four ratio of teachers-to-children for kids up to 2 years old. The ratio decreases as children get older; for example, there must be one teacher for every 20 kids in kindergarten. This means that it is more expensive to provide care for infants than for older children. A lot of daycare centers don't take infants, yet many of our employees needed this type of care so having an infant room was important to us even though it meant higher costs.
We also had to decide whether to have the facility on- or off-site. Most of our employees live close to the laboratory so we knew an on-site location would be convenient for them. Overall, we felt that the on-site option offered the maximum benefit for our employees.
We visited several other businesses with daycare facilities, both large and small, to look at their layouts and equipment. We thought that most of them had limited outdoor space. Depending on the temperature, the state requires children to play outside during the day. We knew we wanted to have a large outdoor play area with a garden, an oval track to ride big wheels, a sand box, grass and playground equipment.
We worked with an architect who had experience in designing daycare facilities and knew the state regulations. Our center is larger than the state requirement of 35-sq.-ft.-per child but we wish it were even bigger.
The state licensing regulations were not a hassle; the regulations protect your liability. However, zoning became an issue. The laboratory is located in an industrial park zoned for industrial use only. After numerous zoning board meetings, the town zoning laws have been changed to allow for daycare in industrial areas.
In the end, we calculated that the laboratory would have to contribute between $800 and $1,000 per month to support the daycare center and that we would have to offer enrollment to non-employee children. We weren't looking at it as a profit source but, rather, as a benefit to our employees.
In December 1997, I hired a director on a part-time basis. It was her responsibility to research our needs, look into getting grants, oversee construction and recruit teachers. She also developed a philosophy for our daycare center.
LMT: What is that philosophy?
Pilsner: The school is called Adventures in Learning. We want to have a low teacher-to-student ratio; 1-to-12 at most for the older kids. The curriculum is focused on developing intuition, curiosity, teamwork, manners and problem solving, all the skills you want in an employee.
We also decided to recruit teachers with four-year degrees because we felt they were better qualified to advance our philosophy. In addition, many of them have pre-school children who need daycare services so they also help fill enrollment in the center.
We want to be a resource for the parents as well. Our teachers try to identify problems and get help, such as speech assistance, for the students.
LMT: Does the cost differ for employees vs. non-employees? Is the fee comparable to other daycare options in your area?
Pilsner: Employees pay $80 per week and non-employees pay $135. These fees are at the low-end of the going rate for daycare in our area. For our teachers who have enrolled their children in the center, their salary is adjusted according to the number of their kids enrolled. Beginning in August, non-employees will be paying $5 to $10 more; employees will pay the same amount but be asked to volunteer one hour of their time per month at the daycare center.
LMT: I understand from your presentation at the February LMT Live! Seminar on How to Keep Good Employees that you received grants to fund the daycare. How did you get those grants?
Pilsner: That's another advantage of hiring four-year-degreed teachers-they know how to write grant proposals. To date, we have gotten three state and federal grants-totaling $37,500-and applied for a fourth. Sometimes the grants have restrictions on how you can spend the money. For instance, the first $15,000 grant we received could only be used for equipment and supplies. As a result, we've got some very nice furniture in the center.
LMT: Some readers may be thinking that a daycare center is out of their league in terms of costs. Can you discuss your expenses in more detail?
Pilsner: The first grant covered all of our furniture and supplies, including cots, dishes, changing tables and playground equipment. Although we spent the entire $15,000 grant, I'd estimate that if you economize, you could purchase all the necessary supplies for about $8,000. Getting donations is another way to cut costs. In fact, once we opened, employees started to donate toys and equipment.
Currently, the daycare center brings in $9,800 per month and, as I mentioned, the laboratory subsidizes between $800 and $1,000 per month. Teachers' salaries are our biggest expense. We pay salaries that are comparable to the local schools. As a percentage of our revenue, we spend between 65 and 70% on salaries (this includes benefits), 8% on food and 5% on rent it pays to the laboratory.
Initially, the center supplied all the diapers. That was an enormous expense so now we require the parents to provide diapers for their children.
LMT: Are there any employees with eligible children who've chosen not to use the center, and why?
Pilsner: Initially, not all employees took advantage of the daycare; they wanted to wait and see how the center progressed and make sure it was a serious, ongoing venture. It filled up so quickly that now we have employees who want to enroll their children but can't because we're booked.
We are currently expanding the facility to 7,000 sq. ft. This will allow us to accommodate 55 to 60 kids. We'll be able to offer full-day kindergarten classes (Wisconsin doesn't required children to attend kindergarten) and after-school programs. This size will be profitable and the additional revenue will be used to hire more teachers, increase teachers' salaries and reduce employees' daycare costs. With the expansion of the facility, we will be able to accommodate all of our employees who want daycare assistance.
LMT: Are there specific rules about when employees can visit their children during work hours? Does having employees' children nearby create a distraction for them?
Pilsner: We offer flexible hours so employees can visit children any time except during naptime. They all know what has to get done and that they are responsible for completing their work. Having the employees' children nearby is not interfering with the workflow at all. On the contrary, we've seen a noticeable decline in absenteeism and tardiness. For example, if a child gets sick, the parent can take an hour off to go to the doctor and then have the child rest on a cot until the parent finishes his or her work. This way the employee spends less time out of the laboratory.
What has really been the most surprising benefit is the change in the spirit of the laboratory and the morale among the employees, even among the ones who don't have children. On holidays the kids use the classroom in the laboratory for various programs, such as an Easter dinner and a Christmas pageant. The entire staff is welcome to participate. They are also invited to go on field trips, such as hunting for dragons or a visit with Mary Poppins. As a result, the kids have formed bonds and friendships with all the staff members.
We have always tried to be a family-friendly business but sometimes it's hard with 80 people. The daycare center has really tied the laboratory together as a community and improved our corporate culture. For as little as it costs, the benefits are well worth it.
People in the community have said that we are "30 years ahead of our time" because we're the first laboratory in our area to offer daycare services. I hope we're not that far ahead because there is such a need for daycare in our society. I didn't realize how great the need was until we actually built the center.
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