If you decide to hire a nanny who will care for your kid, then you turn into an employer. As an employer, it’s necessary to meet particular obligations like national insurance, paying tax, and offering your nanny a pension.
What legal obligations do you have as an employer?
If you employ a nanny, there are many obligations that you have to be compliant with. The following are among the most essential:
Verification Of Right To Work Inside The UK
You have to check and make sure that your nanny actually has the legal right to work inside the UK. Check the identification documents of your applicant, like an identity card, birth certificate, or passport prior to making any formal employment offer.
Tax Contributions
You’re responsible for the deduction and payment of income tax contributions of your nanny. Consult HM Revenue and Customs in order to register as a brand-new employer so you can establish a PAYE scheme.
You also need to maintain records of the payments you make, both for your nanny and yourself.
National Insurance Contributions
You are responsible for the deduction and payment of national insurance contributions on behalf of your nanny. These will be payable on the salary of your nanny, provided she earns more than a particular threshold. Contributions from your nanny and you are calculated as being a percentage of her overall earnings.
Liability Insurance
You have to have employer’s liability insurance, as that’s what covers you when your nanny gets ill or is injured from working for you. You might already have coverage from other insurance policies that you hold, but you should check carefully.
Employment Contract
You need to issue a specifically written contract prior to her starting work or within the first two months of her starting date. It needs to describe her duties, her hours, her salary, and her holiday entitlement.
If there are any changes in the contract details, then they need to be mutually agreed upon by your nanny as well as yourself.
Payslip
You have to give your nanny her payslip every week or month that shows her the earnings and deductions made. Payroll for nannies should be no different than the standard payroll you would expect in your own job.
National Minimum Wage
You have to pay the nanny a rate that meets or exceeds the minimum wage. More than likely, you’ll actually be paying her a lot more than this.
Live-in nannies typically charge from £300 up to £350 for each week. Day nannies might charge a bit more, averaging from £400 up to £475. Keep in mind that each nanny might have her very own salary expectations just based on required duties, as well as her individual skills, qualifications, and experience.
Annual Paid Leave
Each employee, be they part-time or full, is entitled to 5.6 weeks of annual leave or its equivalent. You can pick whether you include bank holidays as part of this allowance or not.
You can negotiate the specific holiday periods individually with your nanny.
Pension
If your nanny’s age falls between 22 and the state retirement age, and she’s earning in excess of £10,000 per year, then you have to establish her a pension scheme. You need to make monthly contributions to this pension scheme, which are based off the gross salary your nanny receives.
Notice Of Employment Termination
During the initial month of employment, either you or the nanny should give one week’s notice of the contract being terminated. Following this, a month’s notice is typically given, although this is another thing you and your nanny can negotiate. Be sure that you put this agreed period of notice into the contract.
Maximum Working Hours
You are not able to make your employee work in excess of 48 weekly hours. You might have heard about this law being called the working time directive.
If your nanny’s age is more than 18, she is able to work over 48 weekly hours, but only if both of you sign an agreement. You aren’t able to force a nanny to sign this, however, and she is free to change her mind any time she wants so long as she offers you a week’s notice.
Statutory Maternity Rights
If a nanny you hire gets pregnant when working for you, then she is entitled to have maternity leave.
If you’re not sure where you need to start with all of these various responsibilities, you can get help. There are businesses who can do payroll for you, simplifying the national insurance and tax contributions. Some even offer pension services.