Case study
St Dunstan’s College

Benefits of a Workplace Nursery Partnership

In 1990 the government introduced the Workplace Nurseries Exemption as a way of encouraging employers to open or run nurseries and reduce the cost of childcare for working parents. This is a more beneficial arrangement than offering a subsidised rate at a local nursery because, under a Workplace Nursery scheme, the cost of the nursery place is exempt from both tax and national insurance contributions. 

There are terms and conditions around what constitutes a Workplace Nursery, including that the nursery must be wholly or partly financed or managed by the employer and meet the appropriate regulatory requirements (set by Ofsted for nurseries in England).

As the Jubilee Nursery met all the requirements for a Workplace Nursery, we helped St Dunstan’s to transition their employee childcare benefit arrangement from a subsidised rate to a Workplace Nursery Partnership. This included advising them on how payments should be made at source as a ‘salary sacrifice’.

For employers, the Workplace Nursery option is attractive as it amounts to a valuable staff benefit (aiding recruitment and retention) while reducing the amount the company pays in National Insurance contributions. In some cases they can also claim tax relief on some of the costs associated with providing the nursery. For employees, the many benefits include having a convenient childcare option at an even greater discount. In other words, it’s a win/win situation.