Rosebud Nanny Agency have recently released a full checklist of useful information you need to know and think about when you are employing a nanny. Take a look at the article below. Thank you Rosebud Nanny Agency, this is fantastic advice!
Nannies tend to talk in Net, which is their take home wage. Rosebud Nanny Agency (and payroll companies) strongly advise you agree the salary in Gross terms – agreeing a Net wage means you as the employer are responsible for paying any and all tax due by the nanny, so if they have another job (using all or some of their tax free allowance), a student loan, or an old employer has underpaid tax, you will have a hefty bill. If you agree a Gross wage, you will always know exactly what you are paying, with no nasty surprises!
The nanny’s gross salary includes their tax and National Insurance contributions. On top of this, you may be liable for employers NI contributions. This will vary depending on your nanny’s salary – a really helpful calculator can be found here – https://www.nannytax.co.uk/calculators/gross-to-total-cost.
It is advised that you have a probationary period written into your nanny’s contract – this is usually 3 months (with the option to extend to 6 months). This has a shorter notice period, typically one week to either employer or employee. Once you reach the end of the probationary period, you should schedule a meeting with your nanny and discuss how you both feel the role is going – has the nanny bonded with the children? Are they enjoying the role? Do you feel they are performing well? If there are any issues, or anything minor you feel could be worked on, this is the time to talk it through (and if suitable, set a time limit to see a change/improvement, and extend the probationary period). If at this point you are very happy with your nanny, take this opportunity to tell them so! It’s nice to feel appreciated.
Once the nanny has successfully completed the probationary period, the notice period will extend – this can be flexible to suit you, but the norm is 4 or 6 weeks written notice either side.
Expenses and other costs
For everyday expenses, e.g. entrance to toddler groups and soft play centres, it is advisable to have a kitty for the nanny to help themselves. They should keep a daily diary, where they will explain all costs (e.g. Thursday morning, toddlers, £1) and the nanny should also keep note of any mileage. If the nanny uses their own car for work, you will need to pay a mileage allowance for all journeys they undertake for work – school runs, trips – but not their commute to and from work. The AA recommend paying 45ppm.
A full time nanny is entitled to 5.6 weeks (28 days) paid annual leave. This includes bank holidays, so usually the nanny has around 4 weeks left. The standard practice is for you to dictate two of her 4 weeks off, to coincide with when you wish to take your family holiday, and the nanny chooses two weeks. They do need to give you notice, and check the dates suit you before they book. If the dates the nanny requires are not possible for you, try to compromise. Usually the nanny cannot take more than 2 weeks at a time.
For nannies that work part time, they are entitled to a pro rata amount of holiday – eg, if they work 3 days per week, they would get 3/5ths of the 28 days – 17 days. If your nanny works varied hours (eg an after school nanny who works full days in the school holidays) the holiday entitlement will be worked out in hours. A good holiday calculator can be found here – https://www.gov.uk/calculate-your-holiday-entitlement
Sick Pay and Maternity Pay
As with any other employee, your nanny is entitled to Statutory Sick Pay (SSP) and Statutory maternity Pay (SMP).
Statutory Sick Pay
SSP kicks in on the fourth (working) day of illness. The first 3 (working) days the nanny takes off work are paid at your discretion. These are known as the ‘waiting days’. SSP is only paid for the usual days of work – for example, if your nanny only works Mondays, the first 3 weeks would be their 3 waiting days – 3 Mondays. So SSP would kick in on the 4th Monday.
SSP is paid from day 4 for up to 28 weeks, and the rate for 2021-2022 is £96.35 per week.
To qualify, your nanny must earn at least £120 per week.
Statutory Maternity Pay
As a Nanny employer, you can claim back the costs of SMP.
To qualify for SMP, the nanny must earn more than £120 per week, and must have been working for you for more than 26 weeks by the qualifying week of her pregnancy (15 weeks before due date).
The first six weeks of her maternity leave are paid at 90% of her gross wage, and the remaining 33 weeks are paid at SMP OR 90% of her normal salary, whichever is lower. At the time of writing, SMP is £151.97 per week.
All Nannies aged between 22 and the state pension age (who earn more than £10,000 per year) will be automatically enrolled into the pension scheme. If the nanny works part time, they will not be automatically enrolled but you will need to set up a pension for them to join if they wish.
Once your nanny is enrolled, they can choose to opt out but that is their decision.