Nanny FAQ ~ Compensation

Base Salary

Overtime

Raises Overview

Anniversary Raise

Performance Raise

Baby Raise

Annual Bonus Overview

Expenses While Traveling

Interviewing Costs

Relocation Costs

Household Accounts
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Base Salary

Unfortunately, there are no cut and dry rules for determining salary. The most important factor is location. If you compare two identical positions, one in Short Hills, NJ and the other in St. Louis, MO, you’ll find they can offer very different compensation packages and attract the same type of high quality caregiver. The only exception to this rule is the salary for executive positions. These positions offer a high-end salary and benefit package regardless of location.

Although there is no typical base salary, there are factors that affect salary in typical ways. When determining your salary range, look at what you bring to the table.

Location

Level 1 (highest) NYC

Level 2 bedroom communities that serve NYC plus Boston and Seattle

Level 3 major cities on the East Coast such as Philadelphia and Washington D.C., major cities on the West Coast such as Los Angeles, San Francisco

Level 4 major cities not on East or West Coast such as Chicago and Dallas

Level 5 (lowest) smaller cities and towns

Nanny's Experience This factor weighs heavily in determining salary. The more experienced you are, the higher salary you can ask for.

Nanny’s References References count a lot in this profession. All nannies should have great references. However, if your portfolio is full of stellar references, you can ask for a higher than average salary.

Age Nannies between 25 and 45 are generally the most sought after so if you’re in that age group, you can ask for a higher salary.

Education While a degree pushes a salary up, it does so only slightly if the you don’t have hands-on in-home care experience. However, a child-related degree combined with nanny experience automatically puts you in a higher salary range.

Stay-at-Home Parent If you are an entry-level nanny, working for a stay-at-home parent doesn’t factor into salary. However if you are an experienced nanny, working for a stay-at-home parent generally raises the salary you can ask for.

Responsibilities If the job requires the typical child-related duties (i.e. children’s laundry, meals, transportation) responsibilities don’t impact the salary. However, if the job requires family- or household-related duties (i.e. family meals, family laundry), the salary will go up accordingly.

Living Space For most live-in nannies, living space factors into the salary they require for a particular job. With all other things being equal, smaller, less private space will increase the salary requirement while more spacious, private space often decrease the required salary.

Overtime

Generally, a nanny sets her overtime rate in one of two ways. First, as a factor of her salary. Generally one and a half to two times her regular rate. This is almost always more than a neighborhood babysitter because the nanny is charging for nanny services, not babysitting. Second, a nanny may charge the going rate for high quality babysitting in the area ($10 to $25/hour depending upon location). This is usually the rate the nanny charges the families she babysits for in her off time.

If an employer comes home 20 minutes late in the evening, leaves 15 minutes early in the morning, that time is overtime. Many nannies don’t charge their employers for this time but many do. Do what you are comfortable with.

Raises Overview

It is standard within the industry for a nanny to receive an annual raise. Some families base their raise solely on the nanny’s performance while others offer both an anniversary raise and a performance raise. How your employer structures a raise is a matter of personal preference.

Anniversary Raise

An anniversary raise (often called a cost-of-living raise) is a guaranteed amount that goes into effect upon completion of a year. Some employer’s base it on the cost-of-living figures provided by the government or their employer, usually between 1.5 and 5%. Others choose a set dollar amount such as $15 or $30 per week.

Performance Raise

A performance raise is based on how well a nanny handles the different aspects of her job including childcare, child- and family-related tasks, and her role in the nanny / family relationship. Most families offer a performance raise of 5 to 15% of the nanny’s base salary, depending upon their available financial resources.

Baby Raise

A new baby raise is generally 10% to 20% of the base salary, depending upon the nanny’s current salary level and how much the new baby will impact her schedule and responsibilities.

Once the amount of the raise is agreed upon, it can take effect at a time that reflects your particular situation. If the mother will be staying home and taking primary care of the baby, it can go into effect when she returns to work. If the family will be hiring a nursery nurse, it can go into effect when she leaves. Or if you will be sharing responsibility for the baby with the mother or a nurse, part of the raise can go into effect when the baby comes home and the rest when the mother returns to work or the nurse leaves. Remember to update your nanny / family work agreement to reflect the new salary as well as the updated schedule and additional responsibilities.

Annual Bonus Overview

It is standard within the industry for a nanny to receive an annual bonus. Many employers offer an annual bonus that includes an anniversary bonus and a performance bonus.

Anniversary Bonus

An anniversary bonus is a guaranteed amount that is paid upon completion of a year. There is no set formula for determining the amount of this bonus. Most employers begin with one to two weeks salary. Generally, a larger amount is given each year representing a tangible reward for long-term employment.

Performance Bonus

Many families will give their nanny a performance bonus following an above average performance review. The amount of the bonus depends on how well she has done her job and the financial resources of your family. For families living on a tight budget, that could mean a $100 bonus check enclosed in a thank-you note. For other families, that could mean $4,000 added to an anniversary bonus.

24-Hour Care Pay

When an employer travels out-of-town and leaves her child at home with a nanny for extended periods of time, the nanny is generally paid per 24-hour period rather than per hour. There is no standard formula for arriving at this 24-hour rate. If you are not the family’s regular nanny, you can expect to earn between $100 to $400 a day depending on the area you live in, the number of children and the referral source. If you are the family’s regular nanny, you can expect to earn between $75 and $300 a day.

Travel Pay

Families that need considerably more coverage when they travel or families that normally have multiple caregivers but are only traveling with one often offer travel pay while away from the primary residence. Paying a flat rate is usually much easier than keeping track of overtime hours. This rate is based on the nanny’s base salary, the amount of expected overtime and any additional responsibilities the nanny takes on while traveling.

Expenses While Traveling

When traveling, employers are responsible for all travel expenses including transportation, lodging, and food plus all entertainment and activity costs incurred while caring for the child. Even if you are not eating with the family, the employer should still provide all meals while traveling.

Interviewing Costs

All interviewing costs are the responsibility of the prospective employer. This includes airfare, train fare, car rental, gas, tolls, parking and hotel accommodations. Major expenses (i.e. airline tickets, car rentals, hotels) should be paid for in advance. Smaller expenses (i.e. gas, tolls, parking) should be reimbursed the day of the interview.

Relocation Costs

An employer is responsible for reasonable relocation costs when hiring a live-in nanny. That includes the costs involved in transporting the nanny and her personal belongings to her new home. For long distance moves, employers generally purchase an airline ticket for the nanny. For local moves, employers generally make the family van or SUV available or rent a U-Haul or Ryder moving van for the day. More experienced nannies will often require an additional relocation allowance for a long distance move. This can include the cost of airfare plus shipping charges for her belongings or the cost of a one-way rental van and the associated travel costs such as gas, hotel, etc. Be sure to discuss the issue in your final interview and outline the details in your work agreement.

Some agencies ask an employer to “advance” the nanny an airline ticket. Once the nanny starts work, the employer then deducts a set amount from the her check each week to pay for the ticket. At the end of the employment relationship, the employer is responsible for providing the nanny with return airfare to her hometown. We, and the overwhelming majority of the nanny community, oppose this policy. If you are working with an agency that supports this policy, we suggest you carefully examine their commitment to the caregivers they place and to the longevity of their placements.

Household Accounts

Almost every nanny will need access to a household at one time or another. You might run out of milk or diapers, want to take your charge out to lunch or purchase art supplies for a new project. An employer can set up a household account in many different ways. She can 1) set up a petty cash fund, 2) provide a credit card, 3) provide a household checking account with an associated ATM / debit card or 4) provide reimbursement for child-and household-related expenses. Be wary of reimbursement because expenses can add up quickly and there can be a considerable lag time between spending the money and being reimbursed. Whatever method you use, the details of the household account should be outlined in your nanny / family work agreement including any restrictions on the account. Remember to discuss your employer’s spending expectations during the interview process. Many times nannies and employers have different ideas about what is appropriate and this issue can become a problem if not discussed beforehand.