Before looking for a position a Nanny should decide how she expects to be paid. Here in Cincinnati, from my experience, I am seeing more and more families open and flexible to paying their Nannies legally. Nannies in our city are also seeing the benefits that being paid on the books has for them. After reading an article on enannysource, I felt it important to pass on more information.
According to enannysource, it “Legal Pay Pays Off…The Nanny profession pays higher salaries that any other segment of the childcare industry – pre-school, daycare. and even times teaching. Each of these is paid “on the books”. Nannies are in high demand professionals, and nannies’ salaries should have the benefits of being paid legally. ”
High5: Benefits of Being Paid Legally
5. Employment History
A nanny who is paid on the books will establish a work history for herself. This may not seem important until she finds herself applying for a school loan, trying to buy a car or even a house. Even renting an apartment can be hard without being able to show that you regularly receive an income. There are numerous situations that will expect a work history including application for health insurance, care insurance, credit card, etc. My husband and I dealt with this first hand when we purchased our home last summer and we would not have been able to without my employment history – 2 years worth – with evidence on our Federal 1040.
4. Unemployment
A person qualifies for unemployment if there job is terminated at no fault of your own. This is a free benefit you IF taxes were withheld. The amount can be up to six months worth, at 50% of your salary. This is a great option to have in a tough or great economy. Can employer deny unemployment? No, but they can contest them.
3. Future Benefits
When paid legally, a Nanny will earn social security and medicare for their future. For younger nannies it may seem too far in the distance or like we will never see this money. For dome of our veteran Nannies, retirement the golden years are getting closer everyday. While you may be unsure what the future holds, this another way to benefit.
2. Disability Insurance
It is my understanding the in most states, Disability is part of what is deducted from your pay. This includes if you are injured separate from your job or if you become pregnant and take maternity leave – this offers benefits while you are unable to work.
1. Viewed as a Professional
Working as a Professional Nanny, you are contributing to the viewpoint of a nanny, by society – her in Cincinnati and beyond. You have a responsibility to live out that professional characteristic in your career. By making a stand to be paid legally, you are saying that you see yourself as a part of your country, your city, your industry – and you want to give where you are expected to. The family that you are working for in most cases would not take a position themselves, where they are not paying taxes. We want them to understand, that we too are professionals, expecting no less.
Nannies should understand that when taxes are taken out of their check, their net pay will be reduced by around 20%, from the gross amount. It is a good idea, to know ahead of time what amount you will need to bring home and do that math accordingly. Very rarely will a family open to changing the way they are paying you, so talking about method of payment early in your interview process is recommended.
There are many resources online! Here are a few:
Tax Breaks for Employers (enannysource)
Breedlove, Frequently Asked Questions.
Each year, the International Nanny Association puts together a Salary and Benefits survey. Follow the link to the 2009 Salary and Benefits Survey, based on the information gathered about the 2008 work year. Please check back the updated version coming soon.
