What most people are not understanding is the way the linkage has been created in the question-
The way the question is framed is that it says "apparent lack of success"
It was expected that due to the implementation of this program, the sick leaves will go down but they did not (this is the apparent lack of success or the paradox in this question). Apparent lack of success doesn't mean failure of the program but the paradox.
Look at option A now: If a nanny is available to stay home with a sick child, then a parent does not need to call in sick. This group of parents is not the target of the free day-care plan, so this answer choice is irrelevant to the situation.
It can be expected that this group of parents was not even taking sick leaves before the plan got implemented. Carefully read the statement "the company's CEO instituted free on-site daycare i
n hopes of reducing the number of employees engaging in this practice".
Option E: Simply says that the employee count in that month increased and hence it could be likely that the number of sick leaves increased. Another way to explain this- suppose in month 1 you have food for 100 people in the office cafeteria. Next month it is reported by the HR department that there was a shortage of food in the cafeteria. Now if we had an option that said that in that particular month 100 more new people joined office. Would that not be enough to fill the gap as to why did the food shortage takes place. An answer choice doesn't necessarily need to be bulletproof, just that it should increase our belief in something. That is exactly what option E is doing.
Bunuel do you agree?