Over in our Facebook group, there was a question recently posed by a nanny (I’m summarizing here):

“I’ve been a nanny for my family for over a year.  After what period of time is it appropriate to ask for a raise?  How do I ask for more paid time off and sick leave? How do I ask for overtime pay, when I initially said it was ok to not be paid that?”

ask for a raise

The topic of a raise can be difficult for a nanny, or anyone for that matter, to navigate.  It is pretty standard to discuss any compensation changes with your nanny family after one year.  You may run the risk of things becoming awkward with your family.  The fear of rejection is real. What if they say no? Do you hold your ground and leave if they refuse (even though they are an otherwise wonderful family to work for)? Will they be open to negotiating?

But you know you are providing valuable service to your family.  Their kids are well-cared for.  You’ve never been late to work, or maybe you’ve never even had to call in sick.  You even go above and beyond in chipping in on household duties because you want to.  Making sure you are well-cared for and feeling appreciated is likely important to your nanny parents.  They may just not have thought about it, and may not in the future unless you bring it up!

Legal Standards

Let’s begin with what the law says.  Is it ok to just not receive overtime pay?  In one word, NO! The law says that an employer MUST pay time and a half for any hours worked over 40 hours in a week.  It is not a choice. 

Even if you are a generous nanny, and think it’s ok to not be receiving overtime pay, consider what just five hours per week of missed overtime pay can add up to in a year. 

As Carissa in our Facebook group points out:

“Five hours a week of overtime doesn’t sound like a lot but if you’re making let’s say $22/hr for the (nanny) share that’s an overtime rate of $33/hr multiplied by 5 hours is $165 a week you’re missing out on!!!” 

ask for a raise

If you figure the nanny is getting two weeks paid time off in a year, 50 weeks of pay x $165/week of unpaid overtime = OVER $8,000 PER YEAR YOU ARE MISSING OUT ON. 

I know I would love to have an extra $8,000 per year- wouldn’t you?  Nannies, don’t sell yourself short, or be “nice” by saying your nanny family doesn’t have to pay you overtime – overtime pay is the law. 

While we are here – employers, if your nanny works 35 hours one week and 45 hours the next week, you cannot “bank” those five hours from the first week and not pay overtime pay the second week.  This is part of the Fair Labor Standards Act (FLSA), which is in place to prevent employers from not paying overtime to employees.  Having a guaranteed hours arrangement does not allow for an employer to bank hours per this FLSA rule.

What about paid sick time? Again, it’s no longer a choice to provide paid sick time to your nanny.  On January 1, 2018, it became a law in Washington state that employees begin to accrue paid sick leave immediately at a rate of one hour per 40 hours worked.  (And yes, this applies to nannies!) Employers (parents) are required to track sick leave and notify the employee periodically of how much they have accrued. A payroll service like Growing Numbers Accounting and Bookkeeping can help navigate this requirement.

ask for a raise

Sick leave can be used after 90 days of employment for a number of reasons.  Some of those reasons include being sick, caring for a sick family member, or caring for your child if their school is closed for public health purposes.  For a complete list of reasons an employee is authorized to use sick time and more on how to properly notify your employer or ask for verification the leave is being used properly, read more here.

Any unused sick leave can be rolled over to the next year, but employers are not required to allow an employee to carry over more than 40 hours.  At the end of employment, the employer is not required to pay out for any unused sick time. 

Annual Reviews

We’ve covered the legalities of what this nanny wanted to address with her employers.  But how to package this eloquently?  Two words: Annual Review.

An annual review is an important part of a healthy employer/employee relationship.  It may even be written in the employment agreement  (and I recommend this) to have an annual review between the nanny and the family.  This can be used as an overall check-in.  How are things going per the family? How are things going per the nanny?  Does the nanny have any concerns about the children? Is there anything the nanny could be doing differently?  What has the nanny observed during her interactions with the children? How might the family’s schedule or needs change in the coming year?  Or the nanny’s schedule/needs?   

Nannies, this can be a great time to address any changes to the law that your family might not be aware of, like paid sick time or minimum wage.  You can introduce any other legalities that are not being met as well.  As in the case of the nanny who originally said her employers didn’t have to pay her overtime, she could say something like the following:

“When we were first discussing my pay last year, I didn’t realize it was the law that I receive overtime pay for any hours I worked over 40 hours in a week.  I did some calculations, and I’m missing out on several thousand dollars a year.  I would like to make sure all of the legal labor standards like paid sick time and overtime pay are being met.”

ask for a raise

And, speaking of legal labor standards, let’s briefly discuss legal pay.  This is something that I hear all the time that nannies want and not all families offer.  Interestingly, I recently heard from a parent that she could not find a nanny because none of the nannies she wanted to hire would accept pay on the books with taxes withheld.  It’s difficult to ask for part of the law to be upheld (sick pay, overtime pay, etc) but then be paid under the table. 

Nannies, if you don’t receive legal pay, you are missing out on documenting your work history with the Social Security Administration.  When you begin to receive Social Security payments later in life, the government will not have an accurate record of your work or earnings history.  This will reduce the amount of money you receive when you are no longer working.  You could also be setting yourself up for potential monetary fines or legal problems. 

Parents, if you are paying your nanny under the table, you are running the risk of some pretty major consequences (fines, legal action and even jail time!) and you are missing out on some big tax breaks.  Typically, employer taxes are about 10% of the provider’s gross payroll. Let’s say your nanny makes $20/hour and works 40 hours a week.  Multiply that by 52 weeks in a year and she will make $41,600. In this scenario the employer’s tax liability is about $4,160.  

The tax breaks you qualify for when you employ a nanny will largely offset your tax liability.  For example, you may have access to a Dependent Care Account (DCA) through the company you work for.  A Dependent Care Account allows you to set aside a maximum of $5,000 pre-tax earnings each year to use toward childcare expenses.  Utilizing a DCA can be a tax savings to you of around $2,300 per year.  

If you don’t have access to a DCA, you can qualify for dependent care tax credits on your income tax return.  Typically you can take a tax credit of 20% – 30% of qualifying childcare expenses.  Expenses of up to $3,000 for one dependent (or up to $6,000 for two or more dependents) can be counted toward this credit. 

If you employ a nanny, you usually get to use either the Dependent Care Account or the dependent care tax credit on your tax returns, but not both.  Check with your tax accountant for information on your unique situation (and the potential for additional savings).  The Dependent Care Account usually provides the greater tax savings.

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More suggestions on an annual review

Career nanny Elijah had this advice to offer his fellow nanny:

“I would ask for a one year review and check in about how things are going. Write down a list of things to talk about, tell them how much you enjoy working for them, give them a plan of ways you’d like to change the care in terms of meeting the kids’ growing needs and development, and then list the compensation changes that you’d like to negotiate. Do it on a Friday and ask them to take the weekend to talk it over and figure out what is within their means and expectations.”

Parent Kristin offered these suggestions:

“You want a raise? You want more time off? You are at the one year mark. Let the employers know  that in light of recent changes in sick leave law, you will need to now ask that they pay sick leave.  In terms of a pay raise:

1. Pull out your original contract and/or refer to your original agreement for $ per hour.

2. Refer to the five hours overtime you have provided to them for the past year/months that you “gave” them – do the math and show them how many hours + the dollar amount.

3. Let them know that moving forward, you will need to be paid for all hours worked, and an overtime rate of 1.5x your normal wage.

4. You can then ask them to consider a 5% raise or additional paid time off (PTO).

5. Let them know that at the second year anniversary, you will require a second full week of PTO plus a 5% annual increase.

Also:

– Do take a sample contract with you with all information in it.

– Do bring a copy of current nanny/household employee laws with you…with area market information to share should you feel you need to.

– Do let them know you are committed to providing long term care for their kids.

– Do review current market rates for nannies and or refer to the Nanny Parent Connection site if needed.

You are a gracious person having given away all the overtime – use it to your advantage.”

Parent Julie also weighed in, pointing out that she, as a parent, also has annual reviews and raise considerations:

“I’m an employer with an after school nanny (15 hrs/week) and she still gets a full five sick days/year available immediately and it’s stipulated that should she work overtime during school break it is time and a half. She also gets nine paid holidays. It seems unreasonable (and illegal) not to pay sick and overtime. Regardless of what you offered, the law is the law. I’m not sure what PTO is with full time – I’d assume a minimum two weeks/year is standard. Perhaps a compromise where one week is aligned with their vacation time and one week is at your discretion? I have a corporate job and the standard for raises is annually at review time.”

Nannies, I hope this information helps you to navigate asking for changes in your compensation with your nanny family.  It’s standard practice to wait for a year to ask for things like a raise or more paid time off.  But if you are not currently receiving legal labor standards like legal pay, overtime pay, or sick pay, any time is the right time to make sure the law is being followed. 

Our Facebook group is a great place to ask questions if you are unsure of how to approach a particular situation with your employer! If you are interested in asking a question anonymously please send me a message and I can help you to do that. 

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