Analysis

Childcare benefits and compensation during COVID-19

Analysis

Childcare benefits and compensation during COVID-19

The closure of childcare centres and schools resulting from the COVID-19 lockdown measures has imposed a heavy strain on families, both on the children and their parents, and especially the mothers. The pandemic exposed yet again the preponderance of women in childcare and housework, raising once more the serious challenges of gender equality, women’s rights to social security as well as their financial security and overall well-being (Doucet, Mathieu and McKay 2020, p. 277).

The crisis underlines the important role of childcare benefits as an income and job protection measure, whether this be in the form of parental, partial unemployment or sick leave benefits. It is also re-igniting discussions on the need for gender-sensitive social security policy (ibid & ISSA 2020c). Since March 2020, social security institutions have recognized closures of day-care centres, kindergartens and schools as legitimate reasons for claiming parental, partial unemployment or sickness benefits. In most cases, parents or guardians of children required to quarantine are also entitled to these benefits. In addition, some countries established childcare facilities that cater specifically to parents working in essential professions especially those in the health care sector.

Social security benefits to offset income loss due to COVID-19 induced childcare

The eligibility to parental and sickness benefits has been extended to include parents or main caregivers of children up to age 14 (no age limit if disabled) in the case of school closures or quarantine measures. In addition, temporary unemployment and mandatory reduced working hours  have in some cases provided alternative avenues to childcare benefits, in the context of the pandemic.

Characteristics and modalities common to these benefits are:

  • Impossibility to combine with other benefits: Most childcare leave benefits cannot be combined with other income support benefits such as unemployment and sickness benefits.
  • Use of traditional benefits for new and emerging childcare needs: Extended parental leave, amended sickness leave schemes are among the current measures provided by social security institutions to support families with children.
  • Use of temporary unemployment and reduced working hours: Use of partial unemployment schemes, including the reduction in working hours for parents who need to stay at home and take care of their children due to school closures or quarantine.
  • One-time payments: Additional one-time payments per child for low- and middle-income families.
  • Childcare vouchers: Provision of vouchers to support the costs of childcare and camps during the holidays.
  • Emergency childcare: Extraordinary provision of childcare for essential workers in the health care sector.

Since the beginning of the pandemic, regular and new benefits have become progressively more generous and easier to access especially when the second wave of the pandemic began in the second semester of 2020, including:  

  • Waiving the approval of employers for leave applications: Employers cannot deny requests for leave by employees upon submission of a school certificate confirming closure or a medical certificate confirming a COVID-19 infection or related quarantine.
  • Additional childcare leave days, which do not deplete regular benefit entitlements
  • More support for the employers, through higher reimbursement rates or government subsidies to enable employers to grant more days of absence to employees
  • Easing of income tests by temporarily excluding asset tests to grant supplementary social assistance childcare benefits.

Country examples

To access childcare benefits, the eligibility criteria often includes proof that parents have to stay at home to care for school-aged children (usually up to age 14) due to the closure of day care centres or schools as a result of lockdown measures, or to comply with the mandatory quarantine of a child who is infected or is suspected of infection.

Table A presents the eligibility criteria, amount and duration of these benefits for a selection of countries.

Austria: Special care allowance to take care of children and other persons requiring care

The special care allowance is payable to parents who need to take care of children (up to the age of 14) due to the closures of schools and kindergartens, or in case the child is in quarantine at home. The second wave and lockdowns in the second semester extended the special care allowance from 1 November 2020 to 9 July 2021. The extension offers more generous conditions: an employer cannot deny an employee’s leave; the entitlement is up to 4 weeks (up from the previous 3); and the reimbursement for the employer has been increased from 50 per cent of salary 1 to 100 per cent. As before, the employee is paid a full salary during this time.

Belgium: Temporary Corona parental leave and temporary unemployment

Parents with children under 12 years of age (21 if disabled) were allowed to reduce their working time by one-fifth or by 50 per cent from May and until end of September 2020. Unlike the regular parental leave benefit, employees had to request this leave in writing, and days were not deductible from the regular parental leave accrued entitlements. Parents were protected from dismissal for reasons related to the leave (regular dismissal for other reasons was still applicable). The temporary corona parental leave was, however, discontinued as of 30 September, and it was replaced by the temporary unemployment benefit announced on 1 October 2020 and running through to 31 March 2021, with a possibility of extension. The change also includes a higher income support than the previous benefit.

Self-employed persons were entitled to a monthly allowance of 532.24 euros (875 euros for single-parent families) in May and September 2020 from their social insurance fund.

Canada: Canada Recovery Caregiving Benefit (CRCB)

The Canada Recovery Caregiving Benefit (CRCB) provides income support to employed and self-employed individuals who are unable to work for at least 50 per cent of the week because they must care for a family member who needs supervised care, or for children under the age of 12 due to the closure of schools or quarantine. A household can receive $500 ($450 after taxes) on a weekly basis. The benefit is not automatically renewed. It can be awarded for up to 26 weeks between 27 September 2020 and 25 September 2021.

France: Partial unemployment to take care of a sick child

Partial unemployment for childcare was in place between March and July 2020, and re-activated on 1 September 2020. The eligibility criteria required the impossibility for parents to telework and proof of either school closure or the child’s close  ontact with a COVID-19 infected person. Currently, the state subsidy to the employer is 70 per cent of the partial unemployment benefit and it will decrease to 60 per cent as of March 2021.

There are other alternatives to request parental leave related to COVID-19 reasons. If a child is suspected of being infected with COVID-19, then the parents may request for a remunerated stoppage of work and ask for paid sick leave after review by the Regional Health Agency. As for the options for self-employed persons, they can also request to stop work temporarily and can claim sickness benefits for the period of childcare.

Germany: Increased parental leave and higher benefits

The ongoing lockdown in Germany prompted the extension of family and parental benefits, including some significant changes to increase support for parents. The rate of the existing cash benefit in the case of sick children (Kinderkrankengeld) was doubled from 10 to 20 days in 2021 (per child and per parent; and from 20 to 40 days for single parents). The extended benefit is paid for children up to age 12 (no age limit if disabled) who cannot attend school due to its closure or due to quarantine. A doctor’s (in case of illness) or a school certificate (in case of school closure) is required. The benefit amounts to 90 per cent of the lost net wages. In addition, a one-time bonus (Kinderbonus) of 150 euros per child for low- and middle-income families will be paid in 2021, benefitting around 18 million children. Single parents’ relief contribution (Entlastungsbeitrag), a tax allowance for single parents, has been doubled to 4,008 euros. Access to the monthly social assistance allowance (Kinderzuschlag) of up to 205 euros per child has been simplified by the temporary waiver of the usually applied asset test until 31 March 2021. As of April 2021, the income test will be simplified by taking into account only the last month’s salary as a reference, instead of the last six.

Italy: Parental allowance at 50 per cent of salary or bonus to cover babysitting services

Since March 2020, the Cure Italy Decree introduced a parental allowance to take care of children up to age 12 (no limit if disabled) due to the closure of schools and kindergartens. The allowance was set at 50 per cent of the insured’s salary for up to 15 days. This was extended to 30 days from May until July 2020. Alternatively, parents could opt for a bonus for babysitting services of 600 euros (increased to 1,200 euros in May; up to 2000 euros for health-care sector employees). The government decided to extend this allowance to December 2020 for children up to age 14 who are required to go into quarantine or if parents opted to work at home during this period.

Japan: New subsidy for parental leave due to closure of elementary schools

The government began subsidizing companies in March 2020 to cover the costs for paid leave of workers who have to take care of children due to school closures. The benefit runs until 31 March 2021. The initial maximum daily amount of 8,330 yen was raised to 15,000 yen on 1 April 2020.

Latvia: Child care benefit until June 2021

Since 30 November 2020, a sickness care allowance is paid to parents who cannot work from home (including the self-employed) but need to stay home to care for a child under age 10 (or 18 if disabled) because of school closures related to COVID-19). The benefit is 60 per cent of the average salary on which social insurance contributions are based. Beginning in January 2021, the benefit is paid per calendar day even if it surpasses a previous limit of 14 days, upon submission of a certificate of closure from the educational or care centre. The application to the State Social Insurance Agency (SSIA) must include a certification from the employer or self-employed person attesting to the impossibility of remote work. The benefit cannot be combined with other sickness, parental, maternity or special support benefits during the same period. The benefit for the first semester of the current year can be claimed until 30 July 2021.

Beginning in November 2020 and until June 2021, parents receiving benefits for dependent children under the age of 24 also receive a new monthly support of 50 euros from the SSIA. This supplement is paid to employees as well as the self-employed.

Luxembourg: Leave for family reasons

Similarly, Luxembourg introduced in March 2020 a paid leave for parents to care for a child up to age 13 under quarantine. This extraordinary leave is also payable to parents who have to look after their children due to school closures and who cannot telework or arrange for any type of childcare. The measure has been made available again from 8 to 21 of February 2021  in view of a lockdown and subsequent closure of childcare centres and schools. Special childcare centres (crèches hospitalières)  have been arranged for the children of parents working in the health care sector.

Norway: Care allowance payment length doubled

The government of Norway extended its care allowance until June 2021, doubling the usual entitlement from 20 days to 40 days per parent per child per family. Parents who cannot work because they need to take care of their children due to closed kindergartens and schools are eligible for the allowance. For the whole year of 2021, it will be possible to request additional days beyond the current entitlement in case of a continued lockdown, or in case the child needs to be at kept home due to doctor’s certified special health concerns.

Conclusion

Teleworking and the additional childcare responsibilities arising from school closures have posed a tremendous challenge for families and parents who need to juggle the education and care of their children, whilst at the same time keeping up with the demands of their work. Childcare benefits therefore represent a significant support during the current hardships that families have been experiencing due to the pandemic.

Income support for parents during the crisis is provided through different benefits, ranging from modified care and parental benefits, sickness benefits, partial or temporary unemployment benefits and one-off payments. Where paid leave entitlements are in place, the related financial burden was often shifted from employers to the government or social security. In many cases, benefits were further increased in connection with the second wave. Social security institutions have been instrumental in meeting the unique needs of families for easier access to benefits, and ensured relaxed requirements adapted to the pandemic situation.

Ensuring an inclusive recovery from this crisis also requires the recognition of the heavier burden on women, the increased risk to step out of the labour market in order to attend to parental and domestic responsibilities, and thus, the higher risk of poverty. More than ever, addressing these gaps and inequalities requires more permanent solutions and policies that go beyond the temporary measures that are currently in place.

References

Austrian Economic Chamber. 2021. Sonderbetreuungszeit verlängert. Vienna.

Chuxuan, S.; Russell, L. 2021. „The impact of COVID-19 childcare closures and women’s labour supply” in VoxEU.org, Centre for Economic Policy Research.

Doucet, A.; Mathieu, S.; McKay, L. 2020. Reconceptualizing Parental Leave Benefits in COVID-19 Canada: From Employment Policy to Care and Social Protection Policy. Toronto, University of Toronto Press.

Government of Luxembourg. 2020. Leave for family reasons in connection with the coronavirus epidemic. Luxembourg.

Federal Government of Germany. 2021. Coronavirus in Deutschland: Informationen für Familien. Berlin.

ISSA. 2020a. Social Security responses to COVID-19: the case of Italy (COVID-19 Monitor – News and analysis). Geneva, International Social Security Association.

ISSA. 2020b. COVID-19 crisis: a renewed attention to sickness benefits (COVID-19 Monitor – News and analysis). Geneva, International Social Security Association.

ISSA. 2020c. Gender-sensitive social security in the Americas (COVID-19 Monitor – News and analysis). Geneva, International Social Security Association.

ISSA. 2021. Coronavirus news monitor. Geneva, International Social Security Association.

Ministry for Solidarity and Health. 2020. COVID-19: le Gouvernement s’engage pour apporter des solutions aux parents qui doivent garder leurs enfants. Paris.

Ministry of Economy and Finance. 2020. The measures introduced by the Italian government to support families. Rome.

Ministry of Health, Labour and Welfare. 2021. New subsidy to support parents taking leave due to temporary closure of elementary schools. Tokyo.

Ministry of Labour and Social Affairs. 2020. Forlenger regler for sykepenger, omsorgspenger og dagpenger [Extends rules for sickness benefits, care benefits and unemployment benefits]. Oslo.

NAV. 2021. Frequently asked questions about the care days. Norwegian Labour and Welfare Administration.

Patronato Acli Italy. 2021. DL Rilancio: Progrogato fino al 31 luglio 2020 il congedo parentale straordinario.

SPF Sécurité Sociale. 2020. Allocation parentale temporaire pour les travailleurs indépendants. Brussels, Federal Public Service for Social Security.

State Social Insurance Agency. 2020. Changes in SSIA services during emergency due to Covid-19. Riga.

Annex

Table A. Conditions to access childcare benefits, benefit amounts and duration
Country Qualifying conditions Benefit amount Duration Other information
Austria

Special care allowance (Sonder­betreuungs­zeit)
Parent cannot telework and has to stay home to care for the child due to nursery, kindergarten, or school closure; or due to mandatory quarantine in case of infection (or suspected infection) with COVID-19. There is no other person who can take care of the child. 100% of monthly salary Up to 4 weeks as of November 2020 and until July 2021 (previously it was 3 weeks) The benefit can also be used to care for relatives who've lost their carer, and to care for relatives with a disability whose teaching facilities have been temporarily closed. Benefit is payable for one parent per household.
Belgium

Temporary Corona parental leave (Congé parental Corona) (May-September 2020) & Temporary unemployment scheme (chômage temporaire) (Oct 2020- March 2021)
In case of inability to work due to taking care of a child, employees must provide the employer with a specific attestation from the school certifying closure, or with a certificate confirming quarantine for the child (whichever applicable). An additional daily benefit and a supplement might be paid due to regular unemployment. Self-employed persons can opt for monthly allowance of 532.24 euros (875 euros for single-parent families). Temporary unemployment benefit: 70% of monthly salary (capped at 2,754.76 euros). For the duration of closure of schools, or quarantine. Days of temporary unemployment will be counted at working days for the calculation of annual leave in all sectors. There is no deduction of the ordinary parental leave credit. There is a protection against dismissal related to the reduction of working hours. Benefit is payable for one parent per household.
Canada

Canada Recovery Caregiving Benefit (CRCB)
For parents caring for a child under age 12 due to school or day-care closures, and not receiving Canada Recovery Benefit (CRB), Canada Recovery Sickness Benefit (CRSB), short-term disability benefits, Employment Insurance (EI) benefits, or Québec Parental Insurance Plan (QPIP) benefits. Benefit is payable for one parent per household. Weekly payment of 500 Canadian dollars. For the duration of closure of schools, or quarantine. The benefit can also be used to care for other family member who is either sick with COVID-19 (or has symptoms); is at risk of serious health complications if infected; or, is self-isolating due to infection. It is possible to apply up to 26 periods of one week each. The benefit is not automatically renewable.
France

Partial unemployment (can be requested for childcare) and temporary unemployment
Both parents are unable to telework, and need to present proof of either closure of the school, or that the child was in close contact with a person infected by COVID-19, both provided by the school. 70% of the parent’s gross salary, with a lower limit of 8.03 euros pay per hour. The benefit is payable for the duration of the pause from work, and at most for the duration of self-isolation.  
Germany

Cash benefit for sick children (Kinderkrankengeld), one-time child bonus, and social assistance allowance (Kinderzuschlag)
Cash benefit for sick children: The benefit will be paid if the child up to age 12 (no limit if disabled), cannot attend school due to closure of the facilities, or due to suspension of a group due to quarantine. In each case, a certificate needs to be presented either from the doctor (in case of illness) or from the educational institution in the case of cease of activities. 90 per cent of the lost net wages. One-time bonus of 150 euros pro child. Monthly social assistance allowance of 205 euros per child. For the duration of closure of schools, or quarantine, up to a maximum of 80 days for families with two children (up to 90 days if 3 or more children). As of February 2021, the quota for the cash benefit for sick children has been doubled from 10 to 20 days per child and per parent (the double amount for single parents). The asset test for the social assistance allowance has been temporarily lifted.
Italy

Parental allowance (congedo parentale), baby-sitting voucher (bonus per l’acquisto di servizi di baby-sitting) and voucher for summer camps (bonus per centri estivi)
For parents that need to take care of children up to age 14 (no limit if disabled) due to the closure of schools and kindergartens, or in case of mandatory quarantine. Alternatively, parents can opt to a monthly baby-sitting voucher. Cannot be combined with unemployment benefits or other income support benefits. Parental allowance: 50% of the insured's salary. Baby-sitting voucher: 1,200 ,euros; up to 2,000 euros (health sector employees) Parental allowance: Up to 30 days (May-July 2020). Baby-sitting and summer camps vouchers: Up to 1,200 euros per household. Initially the benefit was for children up to age 12 but the limit was raised in September 2020 to age 14, as well as the duration of the benefit from 15 to 30 days. The Summer camp bonus was valid for the period of summer holidays.
Japan

Paid leave subsidy
Paid to the parent or main guardian of the child in case of elementary schools' closure. Maximum daily amount of 15,000 yen. n.a. Daily amount was raised as of April 2020 from 8,330 yen to 15,000 yen.
Latvia

Sickness (care) allowance (Slimības palīdzības pabalsts)
For parents who cannot work from home, including the self-employed, with a child under age 10 (or 18 if disabled) who cannot attend pre-school because of closure related to COVID-19. Benefit cannot be combined with other sickness, parental, maternity or other support benefits. 60 per cent of the average salary used to calculate social insurance contributions 14 days with possibility of surpassing this limit Payable to one parent only. In addition, an allowance of 50 euros is paid for parents of children with a disability.
Luxembourg

Leave for family reasons (congé pour raisons familiales)
Paid to the parent or main guardian of a child up to age 12 (no limit if disabled) in case of schools closure, or if the child is mandated to isolate or quarantine, or if the child is especially vulnerable to the virus due to underlying health conditions (a medical certificate is necessary). Payable to one parent at a time; applicable even if telework is possible. Cannot be paid if under short-time work. n.a. For the duration of closure of schools, or quarantine. Days taken for this leave are not deducted from the regular number of leave for family reasons days.
Norway

Care allowance (Omsorgspenger)
Paid to parents who have to take care of children due to closure of kindergartens and schools, or due to infection with the coronavirus. n.a. For the duration of closure of schools, or quarantine. Care allowance days have been doubled for the year 2021 from 20 to 40, though it is possible to request more days.