One of the biggest considerations when hiring a nanny is likely to be the cost. It’s a concern close to the hearts of many New Zealanders as we all grapple with the spiralling cost of living.

You may have a clear idea of the number of nanny hours you need, so you’ll want to know if your budget matches your wishlist. There’s no point in finding the next Mary Poppins only to discover that she’s out of your price range.

If you’re asking yourself, “How much should I pay my nanny,” read on. Find out about all the latest nanny pay rates in New Zealand, along with everything you need to know about the nanny payroll services that’ll help keep you compliant.

Another Increase in New Zealand’s Minimum Wage

A lot can happen in a year, especially when it comes to the average hourly rate for a nanny. Rising inflation and an increase in the national minimum wage are trends that are shining a huge spotlight on our budgets.

From 1 April 2023, the adult minimum wage went up around 7 per cent to $22.70. To give this a little perspective, it was a mere $14.25 back in 2014. That’s a rise of more than 37 per cent in 7 years.

What Should I Pay My Nanny These Days in New Zealand?

We’ve carried out our own research to help you budget for your nanny accordingly. Here are the typical nanny pay rates in New Zealand for 2023 that you need to know about:

• Minimum: $22.70 p/hour
• Average:  $28.62 p/hour
• Maximum: $50 p/hour

We’ve also crunched the numbers for you. This is so that you can see at a glance the approximate percentage of nannies who get paid at any given rate. Here’s the distribution in hourly rates:

• $22.70 - $24: 9 per cent
• $24 - $26:   20 per cent
• $26 - $28:    23 per cent
• $28 - $30:   27 per cent
• $30 - $32:     8 per cent
• $32+:          13 per cent

The biggest category for nanny pay rates in New Zealand lies between the $26 to $32 mark.

Overall, the average hourly rate for a nanny in New Zealand has increased by 8.56 per cent since 2022. That’s well above the simultaneous rate of inflation.

When we compare these figures to 2022, another noticeable observation is the sharp increase in the number of nannies getting paid at the higher end of the range ie: $32 per hour and above.

How How Much Should I Pay My Nanny in the City?

There are lots of reasons that play into pay fluctuations between different nannies. Where you live will be a key driver. Cities tend to command higher-than-average salaries across the board.

The increased demand for nannies and the cost of living may also be key factors that add fuel to the fire. Here are the average hourly rates for nannies in 3 of New Zealand’s major cities:

• Auckland -   Average: $29.43 p/hour
• Canterbury - Average: $25.13 p/hour
• Wellington - Average: $27.44 p/hour

What Other Reasons Lie Behind the Fluctuation in Hourly Rates? 

As a general rule, a more experienced nanny is going to be able to command a higher hourly rate. On top of this, other factors may have an impact on how much you will have to pay. These include:

• The age of the child or children concerned
• The level of qualifications your nanny has
• Your nanny’s life experience and maturity
• Having a driver’s licence

There are no specific entry requirements to become a nanny in New Zealand. It’s preferable, however, to choose someone who at least has a qualification such as:

• A New Zealand Certificate in Early Childhood Education and Care (Level 3 or 4)
• A New Zealand Diploma in Early Childhood Education and Care (Level 5)

The Full Cost of Hiring a Nanny in New Zealand

It's worth remembering that multiplying a nanny’s hourly rate by the number of hours you need will not give you the whole picture. There are specific costs to consider along with other dependencies at play. These include:

• Paid leave and sick pay
• KiwiSaver contributions
• ACC Employment levies
• Car insurance for your nanny if you want them to drive your vehicle

These extras come as part of the territory when you’re an employer. And, an employer is exactly what you will become when you hire a nanny. The business relationship you will have with your nanny will be a formal one. With that comes legal obligations.

A lot of the admin related to hiring a nanny can be time-consuming. This is particularly true if it’s your first time hiring someone. A cost-effective way to deal with this is to outsource the payroll to a third party.

Associated Costs That Come With Employing a Nanny

Employees have every right to expect that their employers are going to pay them on time, give them a payslip and take care of their taxes. Nannies will therefore hold you to the same standards that would apply to any business that employs a worker.

Understanding the Minimum Wage

There are two great big “Nos” when employing a nanny. The first is to think you can pay your nanny cash under the table. The second is to pay your nanny less than the minimum wage.

The minimum wage for all adults is $22.70 per hour. The significant word here is “minimum.” Just because it’s possible to pay someone a minimum of $22.70 an hour doesn’t necessarily mean you shouldn’t pay them more.

Leave, Sick Leave and Public Holidays

Workers in New Zealand have an entitlement to at least 4 weeks of paid annual leave a year if they work regular hours in a full-time or part-time job. This does not include public holidays or sick leave.

Employees can take up to 10 days of sick leave each year too. This applies if:

• They have 6 months’ current continuous employment with you
• They have worked an average of 10 hours per week
• They have worked at least 1 hour each week or 40 hours each month

And, if your nanny has to work on a public holiday, you may either have to pay them a higher rate or give them a day off in lieu.

KiwiSaver

This is a voluntary savings scheme. It’s there to help set employees up for retirement. They can make regular contributions from their pay or directly to their scheme provider.

As an employer, you will need to check if your new nanny is eligible for automatic enrolment in the scheme. If they are, you’ll need to set them up and make the relevant KiwiSaver deductions and contributions on their behalf.

ACC Employment Levy

You must ensure that your home is a safe environment for your nanny to work in. The Accident Compensation Corporation (ACC) is a government organisation. It manages New Zealand’s accident compensation scheme. It also decides on claims.

We often now use ACC in a general way to refer to the entire scheme and the compensation a person might get under it. Costs covered under the scheme include:

• Medical and other treatment
• Loss of income
• Social rehabilitation aimed at restoring independence
• Vocational rehabilitation to get people back to work
• Lump sums for permanent disabilities

Employers shoulder part of the burden of paying for ACC. If they do not pay ACC they can be liable for significant penalties. All New Zealanders also pay an ACC levy. As an employer, you’ll deduct ACC Earners’ levy from your nanny’s wages. 

ACC gives different industries a classification code. The subsequent ACC contributions then vary. They depend on a particular employment sector’s perceived risk among other things. As someone who employs a nanny, the code you’ll need is Q871010.

There are so many dependencies at play here that make it impossible to give a one-size-fits-all figure for ACC costs. A maximum of a few hundred dollars each year rather than several thousand will likely cover your ACC commitments.

Why You Need Nanny Payroll Services

Making sure everything’s above board when employing a nanny takes a lot of time and effort.

This can be hard on parents who are already trying to juggle a career, budgetary pressures and a long list of other commitments. It also requires keeping your eye on the ball. Rules change from time to time. That includes nanny pay rates in New Zealand.

These are some of the reasons why we recommend nanny payroll services to take care of your admin. Pay the Nanny has a team of qualified accountants and financial and taxation specialists. We can advise you on everything from the average hourly rate for a nanny where you live to the contracts you’ll need and everything in between.

Getting Nanny Pay Rates in New Zealand Right

To us, paying the nanny is second nature. For one low and affordable monthly fee, let Pay the Nanny sort out all the admin connected to paying your nanny, from taxes to KiwiSaver. For the time and stress that you’ll save, it’s a small price to pay.