In November, national grocery chain Somerfield is to launch a childcare voucher scheme exclusively for its management grades.
It has ruled out offering the vouchers to shop-floor staff due to minimum wage legislation.
The scheme will be available to between 5,000-6,000 employees, from a total of 65,000.
Tim Jones, head of reward at Somerfield, viewed the scheme as win-win for the company and its staff. "In retail, we have a lot of people at the lower end of the [pay] scale who won't be able to benefit, but they will be better off with [working] tax credits anyway. It's something we can give our staff without it costing us anything."
Kim Plummer, senior consultant at Watson Wyatt, has observed increased interest in childcare vouchers among higher earners since new legislation in April brought tax relief of up to £1,066 per annum.
"[For the high earners, before], a 1% NI saving wasn't a big deal but now you have a tax saving so it becomes very nice, thank you. Ironically, I suppose it adds income to people who earn the most anyway."
She added: "[Employers] are offering it to everybody but [with] tailored advice to those people for whom it is not appropriate because of the minimum wage. It is down to the individual to work out what is best for them. You have to watch out for people who get caught on the working family tax credits but even with all those caveats we're still finding approximately double the original take-up rates."
