How To Increase Your Nanny’s Salary: Tips For Handling An Annual Pay Raise

Nannies are childcare professionals who quickly become part of your family’s rhythms, structure and schedule. Moreover, they may live in your home, an employee who feels more like a member of the family.

When you first create their employment contract, terms like compensation, benefits and vacation days are included in it. But when it’s time to increase their remuneration there are several factors to consider, particularly if your nanny has gone above and beyond their duties during the past year. In this post, we offer guidelines on how to handle your nanny’s pay raise in a professional and positive way, along with suggestions on factors to consider when deciding how much of an increase to offer.

1. Consider the cost of living in your calculation.

Every year goods and services and living expenses cost more than they did the year before. Your nanny must cope with these increases like everyone else, even if they live in your house and don’t pay rent. Take into account rising costs of transportation (do they pay for their own subway pass, for example?) and fees for Internet and cell phone services. These expenses are sometimes subject to big hikes, and you should factor that in when deciding to offer five, 10 or even 15 percent more annually.

2. If their duties have grown, their salary must reflect that.

If your nanny has taken something on that neither of you anticipated when they were first hired, their annual pay raise must be increased accordingly. For example: if your nanny is bilingual, have you agreed recently they will begin tutoring your child in Spanish, Mandarin, or another language? Additional duties like this deserve recognition and reward. Research the cost of private tutors in this field, and use those costs as a guideline for paying a higher compensation to your nanny – the same goes for any other additional duty.

3. Talk over your nanny’s preferred compensation.

Not every nanny is solely concerned with a dollars and cents approach to pay increases. There are many combinations of salary plus bonuses and/or benefits that work well too. For example, you can offer to pay for a yearly gym membership, or taking care of car insurance and other vehicle expenses is another way of upping their remuneration. Increasing paid holidays from time and a half to double time is another way to increase compensation.

4. Your nanny has acquired new skills.

Although professional nannies come to their employer already equipped with a great deal of training, experience and expertise, it may be that over the past 12 months your nanny has added to their resume. Perhaps they took a course in cooking vegan meals; perhaps they have added a master’s degree in child development to their skill set. No matter how they’ve enhanced their qualifications, a year-end raise is the ideal time to recognize and reward them for their additional training.

5. Are you welcoming a new baby soon?

If so, your nanny’s duties will increase considerably. Offering a raise to compensate for the extra work is necessary, and should be commensurate with just how much you ask of them when the baby arrives. Even if you bring in a newborn care specialist for the first few weeks or months, your nanny’s workload will permanently increase, and their pay increase should reflect that.

6. They’ve earned it!

Tying the pay increase to an annual performance review addresses two key issues at once, and is the logical way to approach both. Sitting down together in mid-December, perhaps, or even at the start of the new year, and discussing how the previous 12 months went allows you and your nanny to broach any situations of concern that may have occurred. This is also the perfect time to tell your nanny all the aspects of their job performance that excelled, and offer a pay increase that reflects your satisfaction with that. Rather than offering the standard five percent, offer an increase that reflects how much you appreciate their hard work – 10 percent, perhaps, or even 15 percent. (Elite Nannies is happy to make suggestions about rewarding your nanny appropriately if they’ve exceeded your expectations).

Your nanny has no doubt become a pivotal member of your household, an individual whom your child loves and you rely on to run your home smoothly and responsibly. Nannies do so much more than look after children, and their salary should reflect their level of expertise. Some nannies are also nurses; others are tutors and still others are trained in fitness and massage therapy. All the skills your nanny brings to their job must be rewarded monetarily, but also with less materially tangible aspects as well, such as paid vacation days and health insurance.

If your nanny has excelled during 2021, now is the time to decide that you will express your satisfaction with a salary increase, and how large an increase you will offer.  After all, while nannies are devoted to their charges, they are also employees who work hard and are there almost 24/7 for the children they care for. Recognizing that hard work by offering a significant salary increase lets your nanny know how much you appreciate them, and that you agree they deserve to be rewarded accordingly.