EMPLOYER RESPONSIBILITIES
There are various responsibilities that employers must fulfil when hiring a nanny, mothers help or nanny housekeeper. It is important to remember that the above are NOT normally considered to be self employed.
It is the nanny employer's responsibility to pay all the relevant liabilities (tax and NI) based on the employee's gross salary. This is a requirement of HMRC for both permanent and temporary employment. This must be arranged by the employer and not The London Nanny Agency. please see this link for more information https://www.nannytax.co.uk/the-law/self-employment
Employer’s Liability Insurance must be in place
An employment contract should be in place agreed by both parties
A pension scheme must be offered (auto enrolment). See notes below
The payroll can be run by an outside company and this makes the whole process much easier and straightforward. We recommend Nannytax (www.nannytax.co.uk).
Employers Liability Insurance must also be taken out if it is not already on your household insurance policy. Nanny Tax (www.nannytax.co.uk) and Morton Michel (www.mortonmichel.com) both offer stand alone policies
We can provide a sample contract to the new employers of all our placed nannies if they would like to use it. This is a word document that can be amended for your own use and is between the employer and employee. We are able to provide sample contracts for live out and live in positions, as well as temporary. Please note that if accommodation is provided for the nanny then a licence to occupy should be in place ensuring that the nanny is only entitled to live there whilst being employed by the employer, making sure that it is made clear whether it is a licence to occupy or a tenancy. In the event of a tenancy being preferred then you should seek legal advice to draw up an appropriate agreement.
It is the employer’s responsibility to check about and provide all relevant work permits/visas if the nanny is asked to accompany the family overseas for any reason whatsoever. The London Nanny Agency cannot be held responsible for arranging or advising over this issue.
Please ensure that any nanny that you employ has the correct visa/work permit to work in the UK (see https://www.gov.uk/guidance/employing-eu-citizens-in-the-uk)
Taking your nanny on holiday - if this is likely or required then it should be covered and agreed in the contract. Additional payment for this is at the employer’s discretion but it should be borne in mind that:
The nanny will be away from home and will not be on holiday herself/himself
there may well be additional responsibilities (swimming pool/sea etc)
there could be extra children to care for (friends children etc)
the children may find settling on holiday hard especially if they are young and sleep is disrupted etc
the nanny’s travel and accommodation should be paid for
additional hours worked should be paid for or time given off in lieu. This should be agreed before the holiday.
Consideration should be given to compensating the nanny for being there overnight /away from home.
the nanny should be provided with a private bedroom to herself
Please see this link to the nannytax website for more information
Automatic Enrolment – Pensions
This is essential reading if you either employ a nanny or are a nanny!
What is Auto Enrolment?
This is a government introduced scheme and the aim is to help workers save for their retirement. It is a legal requirement for employers to ensure they have a pension available for their employees.
Who will be affected?
All employers are affected as they have to enrol their workers in a pension scheme or make sure one is available. If the employee is over the age of 22, below the state pension age, usually works in the UK and earning above £10,000 p.a. then the employee will be considered to be an eligible jobholder. Unless the nanny has chosen (and not been asked to) opt out the employer, the nanny and the government will all make a contribution to the nanny’s pension.
What happens if the employer does not comply?
If employers do not comply when they should have done so they may be liable to a fixed fine of £400 PLUS a daily fine of £50 for every day they have been non-compliant.
Can you ask your nanny to opt out of the scheme?
It is against the law to ask your nanny to opt out of the scheme – this is called inducement and carries a heavy fine if caught.
Can the nanny opt out?
It is possible for the nanny to opt out if it is completely their decision and it has not been suggested to them. To do this they have to opt in first to prove it has been offered to them and they can then choose to opt out.
How much will this cost?
It is very important to remember that this is all be calculated based on the employee’s GROSS salary. If your nanny is eligible then it will be a requirement to pay a percentage of the gross salary into his/her pension pot.
Therefore the nanny’s contract must refer to gross salary rather than net. The nanny’s contribution will then be paid out of her gross salary so the employer will only pay for their own contribution. If the salary is calculated on a net basis then the employer may well then end up paying for the nanny’s contribution as well.
For further details, please refer to the Government’s guidance for employers on Workplace Pensions at:
https://www.gov.uk/workplace-pensions
also please see
https://www.nannytax.co.uk/workplace-pensions/about-auto-enrolment