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.
Before any nanny and family commit to working together, there should be a clearly defined working agreement. This working agreement outlines what is expected of each party and ensures everyone is on the same page.
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.
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.
If your nanny works over the number of hours agreed to in a given week or day, you must pay the standard rate of overtime, which is 1.5 times their hourly rate.
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.
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.
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.”
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 a 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. 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 paycheck each week, regardless of how much they actually 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.
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 is frowned upon in the nanny industry and it’s also illegal.
Let’s break down what banking hours means.
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 every nanny should get paid time off or vacation time.
Part-time nannies may only receive a few days of PTO, whereas a full-time nanny may receive up to two weeks in a year.
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
Standard nanny benefits include sick leave. While not required in all states, giving your nanny sick leave is good practice. Some states do have sick leave laws, and you can check what rules are in place in your state here.
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.
A simple way to look at it is: if you have the day off, your nanny should have the day off.
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.
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.
9. Mileage reimbursement
Imagine using your personal vehicle for all things work-related and not getting reimbursed for it. Not only are you accruing mileage on your 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. 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.
10. Cell phone stipend
Does your nanny use their phone during work for work purposes? Are they required to regularly check in with you, schedule appointments, or coordinate play dates?
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. There are many places that offer assistance if you need help figuring out what’s best for your household. Places such as GTM offer a comparison chart and live 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, go ahead and fill out the contact form at the bottom of our home page. We look forward to hearing from you!
