With the new year, comes a host of new laws and regulations that affect us in the child care world. There has been much discussion and back and forth within the community about minimum wage laws, paid sick leave, and mileage reimbursement. I put this article together to help clarify for all of us (including myself) how to best navigate these changes.
(Thank you to Nanny Parent Connection members Becki Brack (who is a CPA) and Cara Nina (one of our marvelous nannies) for granting permission to share some of the below information.)
New minimum wage and sick leave laws went into effect in King County on January 1, 2018. Sick leave is now accrued at one hour per 40 hours worked. The new minimum wage in Washington State is now $11.50 per hour and $14.00 per hour in the city of Seattle. Another change employers should be aware of is the new IRS mileage reimbursement rate of 54.5 cents per mile. If you employ a nanny, these new laws and changes apply to you!
Paid Sick Leave
Does the paid sick leave law apply to household employees?
Yes. According to the City of Seattle Office of Labor Standards, “The Paid Sick and Safe Time Ordinance applies to employers that have at least one employee. The City’s ordinance was recently amended (from more than four full time employees) to match that of the State’s requirements (one or more employees).” For more information, the City of Seattle Office of Labor Standards recommended reviewing this question and answer document: http://www.seattle.gov/…/LaborS…/PSST-QA_%2012_21_17.pdf
Employee Resource Center for Paid Sick Leave: http://www.lni.wa.gov/WorkplaceRights/LeaveBenefits/VacaySick/EmployeeInfo.asp
Frequently Asked Questions Regarding Paid Sick Leave: http://www.lni.wa.gov/WorkplaceRights/LeaveBenefits/VacaySick/FAQ.asp
Basic Sample Paid Sick Leave Policy: http://www.lni.wa.gov/WorkplaceRights/files/FamilyLeave/BasicSamplePSLPolicy.docx>
We offer our nanny paid time off (PTO) in lieu of separate sick leave and vacation time so she can choose how to use it. Does the new law require that you specify sick leave time?
Becki Brack: “No, it doesn’t require it be called sick time or be separate from PTO. As long as your PTO meets the same accrual rate, roll over rate, etc. of the law, then you are meeting your requirements.”
Cara Nina: “…as long as all paid time off adds up to more than the requirement, and can be used for sick days as necessary, [and] accrue and roll over in the same ways as the required sick days, then it is legal. I think best practice for employers is to offer paid vacation and accrued PTO separately, OR make sure accrued PTO exceeds the sick leave requirement to include two full weeks of additional PTO annually.”
Becki Brack: “Correct!”
I work in a nanny share and our agreement includes two sick days, five vacation days of my choice and five vacation days of their choice each year. Are we in compliance with the new sick leave law?
Becki Brack: “Each family needs to give you one hour time off for each 40 hours worked. Legally they can combine it with vacation and call it Paid Time Off (or something similar)….you don’t have to give vacation days on top of sick days. Call it PTO and ask long as the accrual, roll over, etc all meet the state law, you’re okay!”
How many sick days would a full time employee working a 40 hour work week accrue in a year?
Assuming there are two weeks vacation, the employee would work 50 weeks at 40 hours per week: 1 hour per week = 50 hours/8 hours in a day= 6.25 days of paid sick time in a year.
In a nanny share situation, does each family need to pay the nanny minimum wage?
Becki Brack: “There is no specific law or IRS regulation that specifically calls out an arrangement such as a nanny share where two employers/entities are sharing one employee.
However, this is also why we would suggest having each family pay the nanny every other paycheck. Then each family is reporting the nanny’s hours at full wage (which should be minimum wage or more) as opposed to splitting the paycheck each pay period which would likely result in each family paying less than minimum wage.
For instance, Seattle minimum wage is $14 per hour in 2018. If the nanny is paid $20 per hour for a nanny share, should the families split each nanny paycheck, the family would be reporting 50% of the hours at $10 per hour (less than minimum wage).”
Is reimbursing a nanny for mileage required by law?
While reimbursing your nanny is a recommended good practice, it is not a legal requirement to do so. This is the case so long as not reimbursing for mileage doesn’t bring the nanny’s wage below minimum wage once they deduct the cost of operating their vehicle from their pay. The new rate for 2018 is 54.5 cents per mile driven during working hours. Any amount paid above the approved IRS rate for 2018 is considered taxable income.