BIRMINGHAM, Ala. (WIAT) — In September, the Board of Trustees of the University of Alabama System—which includes the University of Alabama, the University of Alabama at Birmingham (UAB), and the University of Alabama at Huntsville—voted to outsource the management of UAB’s Child Development Center. Offered to all UAB staff and students, the center provides an on-site pre-kindergarten program for children 6 weeks old to 5 years old.
By outsourcing its operations, UAB’s Child Development Center is able to achieve its objectives of doubling capacity, maintaining below-market rates, and creating jobs. UAB said while it is still investing the same amount of money into the center, the outsourcing allows for growth at a lower cost— thus saving UAB money. A new facility will be constructed to allow for growth. UAB said it is investing an estimated $5.5 million in its construction.
“KinderCare emerged clearly as an excellent partner to help us meet those objectives,” said Alesia Jones, UAB’s chief human resources officer. “As we looked at how [to] meet those objectives, we wanted to do what was the most good for the most people.”
Several parents of children enrolled at the center have raised concerns over the impacts this transition has on existing Child Development Center teachers, who will be paying significantly more for health insurance.
In June, families were told the university was planning to outsource its childcare. In September, the board of trustees approved a contract with KinderCare at Work. Parents were informed of the contract approval in October. Since November, four of the 14 Child Development Center teachers have resigned. The most recent resignation was on Dec 28.
Parents like Dr. Katie Hunt said the decision to outsource operations cost some of the teachers their job. She says for parents, it cost them peace of mind, not knowing who is caring for their children.
Having closed in March due to COVID concerns, the Child Development Center reopened a month later for healthcare workers serving on the pandemic frontlines. Hunt, a doctor at UAB, said when child center teachers returned to work, it enabled other UAB doctors and healthcare providers to do the same.
“It just feels poorly timed to, a few months later, tell them their jobs are being outsourced,” Hunt said. “It just breaks my heart.”
Hunt said the news came at time when not much was known about COVID-19.
“Without question, [the Child Development Center teachers] stepped forward to take care of high-risk children, when we thought children were the high-risk carriers of COVID back in May,” Hunt said. “They didn’t complain.”
Following the resignations, Hunt said there were times she didn’t know who was caring for her children.
“Two out of three of my children’s teachers had left,” she said. “And I did not know—and I can’t go—into the building to meet them. So I had to email on a couple of occasions to just find out the names of my kids’ teachers.”
How much the Child Development Center teachers pay for healthcare depends on their plan. Below is a list of UAB’s healthcare plans that teachers had access to, prior to the outsourcing. The monthly rates are shown below.
Below is KinderCare at Work’s healthcare plans. The bi-weekly rates are shown below.
When compared on an annual basis, the difference between what some teachers were paying for healthcare before and after the outsourcing is in the thousands of dollars.
UAB would like to note the benefits available in each health plan can vary widely when it comes to the size of the associated physician network, premiums, co-pays, etc.
Dr. Hunt said many of the teachers that resigned did so because they could not afford to stay under KinderCare at Work management.
“Our healthcare is absolutely critical, and our teachers need that, because unfortunately, their salaries don’t get them there,” Hunt said.
Hunt and other teachers have raised these concerns to UAB. Hunt launched a petition that has over 160 signatures of people calling on the university to cancel the transition or increase teacher salary to compensate for pricier healthcare costs.
In response to parents’ concerns, UAB’s chief human resources officer said they took steps to retain current staff.
“When you look at the health insurance that is offered by KinderCare, it may not be the best option for them and their families,” Jones said. “But what we’ve done is we have provided retention bonuses that can help offset the cost of the additional healthcare, partnered with KinderCare to provide sign-on bonuses for the staff to help them with those additional costs, as well other services to help the teachers once they make that transition,” she said.
The sign-on and retention bonuses are one-time. Jones has also said teacher salaries will remain the same, despite the increased cost of healthcare. A UAB employee tells CBS 42 the retention bonus is $1,200, and the signing bonus is $500.
According to Dr. Casey Wang, who has a child enrolled at the center, the bonuses are a band-aid solution.
“I think probably for most of them, it’s not enough to offset the losses that they’re going to experience with the transition,” Wang said.
Echoing Wang, Hunt said not enough has been done to help the teachers, whose annual take-home pay will be significantly less than what they were making under UAB management.
“Their total compensation will dramatically decrease primarily because of an increased healthcare cost to them,” Hunt said.
Teachers will also have less paid time off. A UAB employee tells CBS 42 UAB currently has a pool of sick time for employees who test positive for COVID-19 or must quarantine, so employees don’t have to use their own sick time. No longer part of that system, the Child Development Center teachers will accrue fewer sick days under KinderCare.
The childcare center’s transition to KinderCare management goes into effect on Jan. 11.
When asked if the four resignations were concerning to UAB, the chief human resources officer said it did not come as a surprise. Three new teachers have since been hired, she said.
“In this area, there’s a fair amount of turnover. And in any time where there is the expectation of change, a lot of people will choose to seek other employment,” Jones said. “We’ve done as much as we could to help and much as we could for as many as we could.”
Hunt, Wang, and other concerned parents hope UAB changes its mind in regards to increasing teacher salary to offset increased healthcare costs.
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