So you decided to hire a nanny and have gone through an agency, an online listing (having considered all the downsides of this option in my last blog), posted your own listing, or got a referral from your best friend’s nanny.
When you interview a nanny, you want to find out a number of things:
- Is she responsible and will she be reliable?
- Will she listen to my directions or does she have her own strong opinions of child rearing?
- Is she loving?
- Does she consider yelling or spanking appropriate methods of child rearing?
- Will she be creative or will she spend the entire day in front of TV or DVD’s?
- Will she be calm in case of an emergency and know what to do?
- Will she run her own errands or will she spend the entire day texting her friends?
- Does she know developmental milestones and be able to stimulate my child?
The interview is critical to your comfort and sense of security for months or years to come, so do not simply go through a resume (many won’t even have a resume), and ask general questions about life goals. You need clear answers.
These are some guidelines to get at the answers that you need to know before you evaluate a nanny candidate:
- Don’t ask “yes” and “no” questions. You want to ask open-ended questions to get the candidate talking about her childcare experience.
- Have you taken care of a child the same age as mine? What kinds of activities you did with a child that age? What did you do on rainy days? How did you handle her crying when her mom and dad went off to work?
- Under what circumstances would you feel it justified to raise your voice or to spank my child?
- What would you do if my two children were fighting over a toy?
- If my daughter developed a fever in the middle of the day, what would you do?
- Don’t ask questions that make it clear what you expect the answers to be.
- Will you call me when you’re stuck in traffic and will be late?
- Will you give my child sugary snacks if I ask you not to?
- Are you a reliable person?
- Ask questions to find out the nanny’s childcare philosophy.
- Tell me about a time when you were caring for children who just wouldn’t settle down for bed. What did you do?
- What would you do if my son had a temper tantrum because you wouldn’t buy a sugary cereal at the grocery store?
- What would you do if you disagreed with me about an issue regarding my children? For example, what if my child won’t eat the lunch I asked you to prepare for him? What if you do not want to actively play outdoors in the wintertime, as I have asked?
Getting References for Your Nanny
Speaking to the nanny’s past work and nanny references is the most valuable indicator of how reliable, responsible, creative and loving she will be with you. Be prepared with a list of questions for the reference beyond “Did you like her?”
- How many times did she call in sick in the time she was with you? Did she ever call at the last minute, leaving you in the lurch?
- Were you aware of her own vacation schedule far enough in advance so you could get a substitute? Did she give you a summary of the day’s events? Give you accurate telephone messages? Always answer the phone when you called?
Loving/Creative/Sense of Humor
- Did your children look forward to her coming? Did you find evidence of what they did during the day (drawings, art projects, home baked cookies?). Did she come and go with a smile on her face, with a cute anecdote about the day?
Sometimes references are worried about liability and do not want to talk about the nanny. This is hard – your have to figure out if the reason is because the experience was negative or if the reference is just following a “no talk” policy. Ask a reluctant reference just this one question: “I am a mom (or dad) hiring a nanny for my baby. She won’t be supervised during the day. It’s a lot of responsibility. Should I be thrilled to have this person in this role, or should I use caution?”
The Nanny Work Agreement
Once you decide to hire a nanny, write up a simple work agreement that you both sign so that the responsibilities are clear. Don’t make it a “legal” document with legalese language. Make it short, sweet and to the point. This work agreement helps both of you.- to remind you about the household chores or the schedule that you two agreed on. Sometimes parents begin to pile on new jobs once the nanny is hired. Sometimes nannies decide to ignore the laundry which was part of the agreement. It’s a great reference point. Note: a nanny is hired to care for your child. Don’t make the mistake of giving the nanny so many household chores that it detract from the nanny/child interaction. Most full-time nannies care for the child and the child’s room, laundry, and meals (including clean up). If the nanny is asked to do more, and she agrees, be prepared to pay more (ironing, the family laundry, dinner prep, etc.). You can find some sample work agreements on the International Nanny Association website.
Your responsibilities as an employer
The following information is from Breedlove and Associates, my favorite payroll and “nanny tax” service: http://www.mybreedlove.com. A household employer is defined as someone who pays an individual to perform duties in or around their home. Household employees include nannies, housekeepers, personal assistants, household managers, etc. If a family pays a household employee $1,700 (2011) or more in a calendar year, they are required to meet the “nanny tax” obligations as well adhere to local, state and federal employment laws. Don’t worry, these obligations are not nearly as onerous or as expensive as most people think.
If a family pays an employee less than the $1,700 threshold, the family is absolved of the “nanny tax” obligations, but they are still considered an employer and must adhere to local, state and federal employment laws.
The Household Employer’s Legal Responsibilities
Minimum Wage. Household employees must be paid at a rate that meets or exceeds the Federal Minimum Wage standards — currently $7.25 per hour.
Mileage Reimbursement. Employees who are asked to use their own car while on the job should be reimbursed at a rate of 55.5 cents per mile (effective July 1, 2011). Commutes to and from work each day are not considered “on the job” and, therefore, employers are not responsible for any reimbursement on those miles. If money is paid to the employee to defray the cost of commuting to and from work each day, it is considered taxable income and should be reported as part of the employee’s compensation.
Overtime. Household employees are classified as “non-exempt” workers, and federal overtime law dictates that non-exempt workers must be paid overtime if they work more than 40 hours in a 7-day work week. Overtime is calculated at a rate of 1.5 times the regular rate of pay. Exception for Live-In Employees: Families are not required to pay live-in nannies at the overtime rate, but they must pay the nanny for every hour worked. It is legal to pay your employee a salary and have the overtime hours included in the compensation. To accomplish this, you must have a written employment agreement that explicitly details the regular rate of pay and the overtime rate of pay.
Paid Time Off for Vacations/Illnesses/Holidays. Household employers are not required by law to provide paid vacation, sick days or holidays. While these perks are an effective way to attract and retain good nannies, most household employers are not legally obligated to offer them.
Legal Work Status. According to the law, employers are required to verify that workers are legally permitted to work in the United States. Specifically, the government asks each employer to utilize Form I-9, which verifies the identity and employment eligibility of all citizens and foreign nationals.
Workers’ Compensation. Employers in some states are required to carry a Workers’ Compensation policy on household employees. Workers’ Compensation is not a tax; it’s an insurance policy that helps cover lost wages and medical expenses due to injury or illness resulting from the workplace. Check with your homeowner’s insurance carrier to see if it is included as part of your umbrella homeowner’s policy. If you’re not already covered, you can usually add a rider to your policy.
The Household Employer’s Tax Responsibilities
Household employers can expect to PAY employer payroll taxes of approximately 9-11% of their employee’s gross wages (Good News! Tax breaks can save you as much or more than the taxes). Specifically, the employer taxes are:
- The employer’s half of Social Security & Medicare (“FICA”). The rate is 7.65% of employee’s gross wages.
- State Unemployment Tax Assessment (“SUTA”). The rate varies by state.
- Federal Unemployment Tax Assessment (“FUTA”). The rate is 0.8% of first $7,000 of employee’s gross wages and, therefore, caps at $56/year.
- Other state taxes (many states have a small additional tax in order to fund initiatives such as workforce development/training)
Household employers are required to WITHHOLD taxes from their employee’s paycheck. Specifically, those taxes are:
- The employee’s half of FICA (7.65% of gross wages). In 2011, employee FICA taxes are reduced to 5.65%.
- Federal Income Tax (withholding rate based on allowances chosen by employee on Form W-4)
- State Income Tax (withholding rate based on allowances chosen by employee on state Form W-4)
- Other state taxes (some states levy additional taxes to pay for things like Disability Insurance)
The Compliance Checklist
- Register for federal and state tax accounts
- Complete and file New Hire Report
- Calculate the correct amount of federal and state taxes to withhold each pay period
- Track gross pay, net pay, federal taxes withheld and state taxes withheld
- Prepare state tax returns and remit both the employer and employee taxes quarterly
- Prepare federal tax estimates four times per year and remit both the employer and employee taxes
- Prepare year-end summaries to state tax agencies
- Prepare Form W-2 and distribute to your employee (and any former employees who had wages during that calendar year)
- Prepare Form W-3 and send to the Social Security Administration (along with Form W-2 Copy A)
- Prepare Schedule H to accompany your personal federal income tax return
- Respond to IRS and state requests/inquiries
- Monitor ever-changing household employment tax law