What many families forget — or aren’t even aware of — are the standard nanny benefits that should be a part of every family-nanny relationship. Whether you employ a part-time or full-time nanny, certain benefits are standard and should be upheld.
A willingness to provide basic standard nanny benefits ensures your ability to attract qualified nannies and provides an incentive for your nanny to stay with you long-term.
Working Agreement: Establishing a Solid Foundation
A successful family-nanny relationship begins with clear communication and well-defined expectations. One of the fundamental components of this foundation is a carefully crafted working agreement. This agreement acts as a roadmap, guiding both parties through their roles and responsibilities while fostering mutual respect and understanding.
Why a Working Agreement Matters
Consider the working agreement as a handshake in writing – it solidifies the terms and conditions of your collaboration. By clearly outlining what is expected from both the family and the nanny, you ensure that everyone is on the same page from the very start. This proactive approach helps prevent misunderstandings down the road, creating a harmonious work environment.
The working agreement covers a range of crucial topics, such as work hours, job responsibilities, compensation, and benefits. It also addresses more nuanced aspects, such as overtime policies, communication preferences, and any specific family requirements.
Creating a Collaborative Document
Crafting a working agreement is a collaborative effort. It provides the opportunity for open discussions about expectations and preferences. Both parties can openly communicate their needs, ensuring that the agreement reflects the reality of the job and is fair to everyone involved.
The following standard nanny benefits are important to consider adding to your working agreement. Remember, no nanny should start work without agreeing to and signing the working agreement. It’s imperative that you and your nanny understand the terms and that everyone feels respected and supported.
Remember, the working agreement is a dynamic document that can evolve as circumstances change. Regularly revisiting and updating the agreement allows both the family and the nanny to adapt to new situations while maintaining transparency and trust.
11 Standard Nanny Benefits to Consider:
1. Overtime
Under the Fair Labor Standards Act (FLSA), you are required to pay your nanny overtime when they work more than 40 hours in a week or over 8 hours in a day. According to the FLSA, one exemption to this is if you have a live-in nanny. Even so, you still must pay your nanny their regular wage for every hour worked.
Overtime pay isn’t merely one of the standard employment benefits; it’s a tangible demonstration of appreciation for the extra effort your nanny invests. By compensating your nanny at the standard rate of 1.5 times their hourly wage for overtime hours, you acknowledge their willingness to go above and beyond.
No matter how much your nanny loves your kids, they’ve agreed to a certain number of hours of work, just as you have. You may think they don’t mind and they’re simply “doing you a favor” by staying an extra hour when you’re late from work. But please respect your nanny and their profession by adhering to this standard nanny benefit.
Remember, the goal is to maintain a working environment that nurtures respect and values your nanny’s time. Adhering to overtime regulations is not just a legal requirement but also a reflection of your commitment to cultivating a professional and harmonious partnership.
2. W2 VS 1099
At Hello, Nanny!, we hear of so many nannies being issued a 1099. Unfortunately, this is both illegal and unfair to your nanny. A nanny is classified as an employee of your family by the IRS, not an independent contractor. To explore a professional payroll service to fully understand the benefits to your family, and to your nanny, we recommend reaching out to Care.com which specializes in nanny payroll. It is easier to do than you may think.
As stated by the IRS:
“Household employees include housekeepers, maids, babysitters, gardeners, and others who work in or around your private residence as your employee. Repairmen, plumbers, contractors, and other business people who provide their services as independent contractors, are not your employees. Household workers are your employees if you can control not only the work they do but also how they do it.”
Misclassifying nannies as independent contractors has significant consequences. When a nanny is legally considered an employee, the employer is responsible for withholding and paying employment taxes. Independent contractors, on the other hand, handle their tax responsibilities. By issuing 1099 to a nanny, you’re effectively transferring the tax burden onto them, an arrangement that contradicts legal requirements and ethical practices.
As the employer, you dictate how your nanny does their work — you decide their hours and set their schedule, you instruct on their method of care, and you supply the tools necessary for the job.
As an employer to your nanny, FICA taxes are split evenly between you and your nanny (FICA taxes are a combination of Social Security and Medicare taxes). Considering your nanny to be an independent contractor and issuing 1099 means they pay both the employer and employee shares of FICA taxes.
This standard nanny benefit must be upheld, regardless of whether your nanny is part-time or full-time. This not only safeguards your family against potential legal issues but also ensures your nanny’s fair treatment and financial security. You can read our blog on taxes for nannies here.
3. Guaranteed Hours
Guaranteed hours for nannies is a big benefit that’s often missed.
But what are guaranteed hours?
If you and your nanny have agreed to them working 40 hours a week, your nanny receives a 40-hour guaranteed pay each week, regardless of how much they worked (unless they worked over 40 hours — then they’d receive overtime pay).
For example, let’s say Grandma is coming on Friday and you decide you don’t need your nanny for that day. Since your nanny was available for work and you chose not to use them, they still get paid for Friday.
Your nanny committed to being available to you for those 40 hours — or whichever amount you agreed upon — each week. You’re paying for their availability, even if you choose not to use it.
Don’t leave your nanny in the lurch by not paying them for an hour, a day, or a week you don’t need them because of a change in your plans.
Life often throws curveballs, reshaping plans at a moment’s notice. However, ensuring that your nanny isn’t left financially vulnerable due to such shifts is a matter of responsibility.
Also, guaranteed hours aren’t merely a contractual convenience; they form a cornerstone of financial stability for your nanny. By offering a dependable income, even when the schedule fluctuates, you enable your nanny to manage their finances more effectively and navigate life’s uncertainties with confidence.
Incorporating guaranteed hours into your nanny’s compensation package goes beyond administrative formalities. It lays the groundwork for a partnership characterized by stability, understanding, and equitable treatment. Seasoned nannies may even regard this benefit as a sign of a respectful work environment.
Guaranteed hours are a standard nanny benefit and should be included in the benefits you offer to any nanny. Many experienced nannies may ask for guaranteed hours upfront, as well.
4. Banking Hours
Banking hours tie hand-in-hand with guaranteed hours for a nanny. Banking hours are frowned upon in the nanny industry and it’s also illegal.
Let’s break down what banking hours mean.
Using the same example as above, let’s say Grandma is coming to town Friday and you don’t need your nanny for that day. Instead, you want to ask your nanny to work a different day to make up those unworked hours. Or maybe, you’d like them to come in an hour early one day and stay a few hours late another day until the hours are met.
The problem here is your nanny was available for work on Friday and you chose not to use them. Asking them to make up those hours so they “deserve” their entire paycheck is disrespectful to your nanny.
You’re placing the weight of your decision on your nanny’s shoulders and asking them to make up for it. But if you chose not to use their services when they were available, that’s on you as the family and employer.
The FLSA requires all “covered employees” to be paid for all hours worked in a workweek, and nannies fall under the “covered employees” umbrella. This means asking your nanny to make up those hours the following week or throughout the next month is illegal.
While it’s not illegal to ask your nanny to make up those hours in the same week, it’s still unfair to your nanny, and they should be under no obligation to do so.
Banking hours isn’t a good practice in the nanny industry. And as an employer to your nanny, your desire should be to foster a trusting, amicable relationship with your nanny.
Please don’t put your nanny in a tough position by asking them to bank hours in the first place.
5. Paid Time Off
Full-time nanny benefits vary from part-time nanny benefits, but just like any professional, your nanny deserves moments to recharge and rejuvenate. Providing paid time off isn’t just a matter of fairness; it’s about acknowledging the hard work and dedication your nanny brings to your family. By offering PTO, you show that you understand the need for work-life balance and value their well-being.
While the importance of paid vacation holds for both part-time and full-time nannies, the allocation of days may vary based on the arrangement. Part-time nannies may receive only a few PTO days, reflecting the nature of their commitment.
On the other hand, full-time nannies, who play a significant role in your family’s daily routine, typically receive a more comprehensive PTO package such as two weeks a year. The aim here is to ensure that regardless of the schedule, your nanny can enjoy well-deserved time off to recharge, pursue personal interests, and return to their role with renewed enthusiasm. Also, it not only contributes to their job satisfaction but also nurtures a sense of commitment that extends beyond work hours.
If your family is going on vacation for a week and you’re worried about your nanny, you have a couple of options. You can either:
- Allow them to rest
- Bring your nanny on vacation
- Encourage them to use some of their PTO
- Ask them to do light housework, dog- or house-sit, or run some errands
Remember, being a nanny is a hard job. It’s exhausting work and your nanny gives their all to your family. It’s ok to let them have a break and take some time to refresh.
6. Sick leave
Offering sick leave to your nanny goes beyond a mere contractual obligation. It’s a testament to your commitment to their health and overall well-being. Just like anyone else, nannies can fall ill unexpectedly, and ensuring they have the option to take time off to recover without financial strain fosters a supportive work environment.
Sick days not only showcase empathy but also build a foundation of trust and loyalty, allowing your nanny to focus on recuperation and return to their role with renewed energy.
While some states have specific sick leave federal laws in place, it’s important to acknowledge that regulations can differ from one jurisdiction to another. Even in areas where there might not be a legal mandate, providing sick leave remains a considerate practice that demonstrates your commitment to your nanny’s health.
Overall, all nannies should get sick leave. Full-time nanny benefits vary from part-time benefits, as a full-time nanny should get more sick leave.
7. Paid Holidays
Every nanny should receive the benefit of paid holidays, whether they’re part-time or full-time. A year’s paid holidays vary between 6-12 days and they should receive at least five to seven holidays.
Paid federal holidays for nannies are like a little boost of appreciation and self-care wrapped into a neat package. Giving them paid time off isn’t just a nod to their hard work – it’s a big high-five to their well-being. After all, taking care of little ones is no easy feat, and having those days to unwind can make a world of difference in keeping their spirits up and energy levels high.
Speaking of fair play, why not sync up holidays? If the boss gets a day to relax, it’s only fair that the nanny gets to put up her feet too. Treating holidays like a shared deal shows that everyone is valued in the game including their work-life rhythm. Plus, it’s a surefire way to keep the nanny-parent relationship sailing smoothly.
8. Severance Pay
While severance pay is not legally required, it’s a standard nanny benefit that should be considered. Whether you’re relocating, your child got into a school they were wait-listed for, or you decided to quit your job, your nanny deserves severance pay.
Severance pay when parting ways with a nanny is a gesture of respect and financial support during a transition. It’s like a safety net that acknowledges the time and effort invested in the job. Offering a standard severance pay also paves the way for a more positive farewell, emphasizing mutual understanding and appreciation.
The minimum standard severance pay for a nanny is two weeks. However, if you can afford more, four weeks’ severance pay is much more acceptable. A good guide to follow is: two weeks of severance pay with an additional week for each year worked. This acknowledges the relationship’s longevity and ensures a smoother adjustment for both parties as they move forward.
9. Mileage Reimbursement
Imagine using your car for all things work-related and not getting reimbursed for it. Not only are you accruing mileage on your personal vehicle, but you’re also adding wear and tear — leading to more frequent oil changes, tune-ups, and tire replacements.
Basic nanny benefits include mileage reimbursement in their employment package. If your nanny is taking your children to and from school or anywhere else, grocery shopping, or running other errands for you, they are entitled to mileage reimbursement.
The rate set by the IRS for 2023 is 65.5 cents per mile. This rate not only ensures a fair reimbursement for the nanny but also aligns with tax regulations. The IRS usually updates this rate annually to account for fluctuating fuel costs and other factors.
Mileage reimbursement isn’t just about putting gas money back in the nanny’s pocket – it’s a way to recognize the extra miles they go to provide top-notch care.
10. Cell Phone Stipend
A cell phone stipend isn’t just a tech-savvy perk – it’s a recognition of how nannies are often the real-time conductors of household coordination. From scheduling playdates to staying in touch with parents throughout the day, their phones are essential tools. Providing a cell phone stipend not only covers work-related costs but also acknowledges the pivotal role technology plays in their caregiving.
If so, consider adding the benefit of a cell phone stipend. Currently, California is the only state that requires employers to pay a cell phone stipend, though it’s not specified how much to pay. One suggestion is to pay a flat fee per month, such as $50.
11. Extra Perks
There are a few other nanny benefits that help you attract and retain qualified nannies.
Nanny health insurance or a health care stipend is something beneficial for both you and your nanny.
Healthcare coverage for your nanny can be reasonably affordable. Many places offer assistance if you need help figuring out what’s best for your household. Places such as Care.com offer a comparison chart and can help to get you started.
If you don’t want to offer health insurance for your nanny, consider paying a healthcare stipend that goes toward their healthcare. You can do this by adding an amount to their normal income or by setting up a Health Reimbursement Arrangement (HRA). An HRA is an account you provide your nanny for healthcare costs.
California requires all employers to have worker’s compensation insurance, even if you only have one employee. This includes nannies, whether they’re part-time or full-time.
A few other nanny benefits you might want to consider are a car detail once a month and holiday and end-of-year bonuses.
As we mentioned earlier, if your nanny is using their vehicle for work-related purposes, that’s adding a lot of wear and tear to their car. Offering to pay for a car detail every so often is a thoughtful way to recognize what they’re doing for you and your family.
While holiday and end-of-year bonuses may feel like just an extra expense to you, they go a long way in letting your nanny know how much you appreciate the work they do. These bonuses remind nannies of their value to your family. Withholding bonuses may make your nanny feel unappreciated and as though their work goes unrecognized, so please consider budgeting for them. You can read our blog about holiday bonuses for nannies here.
Hello, Nanny! Is Here to Help!
We know how overwhelming this list seems when you’re just starting the process of hiring a nanny. Maybe you’ve employed a nanny for some time, but there are many standard nanny benefits you’ve never been aware of until now.
We understand you care about your nanny. You desire to have a good relationship with them built on trust.
You want your nanny to feel secure and well-cared for in their position, but maybe you aren’t sure how to do that.
This list of standard nanny benefits goes a long way in accomplishing that desire. And if you still feel confused and overwhelmed, Hello, Nanny! is here to help.
We provide professional assistance in matching the right qualified nanny with the perfect family. Aligning your needs and wants with the qualifications of a nanny is our expertise. We work tirelessly to ensure both the nanny and your family are satisfied with the agreement.
If you have questions but aren’t ready to start the process of finding a nanny, learn more about finding your perfect nanny today!
