The sad truth about daycare is that after so many years our sense of smell is not as strong in this area as it needs to be. We have to change the children every 2 hours, but check them every hour on the hour. If one of us walks outside for awhile and comes back in, the smell is immediately apparent. But if we have been in the room all day long, we don't smell it as fast. You can't understand this unless you have been through it.
It's true that it's the providers problem though. She needs to set an alarm or something and check him more often. She also needs to write down the time each day he potties and try and get a sense of when it will happen. Most kids get a look on their face or prefer to run off by themselves or something. At 16 months it would not be out of the question to sit him on the potty for a few minutes every 30 minutes or so during the couple of hours he usually goes, if it's predictable. It's not always predictable for all kids.
Also, some kids dig as a way to inform the grown up that the problem exists. So the child should be spending more time in the sights and attention of a provider. Is this a multiple care giving situation? I spent many years by myself. It's much better to have 2 of us with the kids. No child should be unsupervised for any length of time. With 2 of us here, we can arrange our day and chores in a way to take care of these kinds of problems before they get out of hand.
This is really a very common complaint that I read on daycare lists. I think it stems from kids competing for attention in daycare and daycare providers being spread a little thin. In our defense, we get paid very little for what we do and it takes multiple kids to make ends meet. If you don't think your provider is able to handle this, it may be time to move on.
Suzi