Pay Rates for Nannies in 2022
Hourly Rates for Nannies in New Zealand in 2022
One of the biggest considerations when hiring a nanny is likely to be the cost. 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, “What do I pay my nanny?” read on for everything you need to know about nanny pay rates and nanny payroll.
Your Guide to Hourly Nanny Rates 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 other related 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.
Many nannies see their role as part of a long-term career. They choose and love what they do. They may often have specialist skills and credentials to match the broad spectrum of families they’ll be working for.
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.
What Do I Pay My Nanny?
We’ve carried out our own research to help you budget accordingly. Here are the typical hourly rates you need to know about:
- Minimum*: $20.00
- Average $26.17
- Maximum $40.00
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:
- $20 - $22 p/hour: 11 percent
- $22 - $24 p/hour: 14 percent
- $24 - $27 p/hour: 42 percent
- $27 - $30 p/hour: 25 percent
- $30+ p/hour : 8 percent
*N.B the minimum hourly rate is set to increase to $21.20 per hour in April 2022.
What Lies 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. They include:
- The geographical location where you live
- 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
- The demand for nannies in your area or region
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)
Secondary education in relevant subjects such as health education and home economics is also useful.
It’s not uncommon for nannies to study for a further qualification while working. That could include a New Zealand Diploma in Early Childhood Education and Care (Level 6). Other nannies may have specific qualifications for children with special needs.
Some nannies may have spent part of their careers doing relevant work or training, such as nursing or a stint overseas for a childrens’ charity.
Nannies may have qualifications earned outside of New Zealand. They can have these officially assessed so that you can see how they compare. You can find out more about this here.
There are regional fluctuations across the country. Larger urban areas generally command higher rates of pay. Nannies who look after newborn babies may also earn a better rate.
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.
Leave, Sick leave and Public Holidays
Workers in New Zealand have an entitlement to at least 4 weeks’ 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 claim 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.
Like all other employees, nannies can choose to contribute 3, 4, 6, 8 or 10 percent of their gross salary to their KiwiSaver account.
A person can usually only access their KiwiSaver funds after the age of 65, except in some limited circumstances. These include significant financial hardship or using the cash as a deposit for a first home.
ACC Employment Levy
As a responsible employer, 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 will provide cover for you or your nanny if there's an accidental injury at work. The levies will go towards treatment and getting your nanny back to work as fast as possible. The amount you will pay will depend on how much you are paying your nanny.
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.
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 $20.00 per hour or $160.00 for an 8 hour day. The significant word here is “minimum.” Just because it’s possible to pay someone $20.00 an hour doesn’t necessarily mean you should. It's also set to increase to $21.20 in April
All employees, nannies included, need to feel valued. You will be entrusting another person to care for those most precious to you. That’s a service that’s worth a great deal in terms of its emotional impact and the opportunities it creates for you and your family.
It often means parents can carry on working to pay for education, holidays and activities that will enrich the lives of their children. A nanny will also free up quality time for parents to spend with their children.
Ensuring Compliance with Rules and Regulations
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 and a long list of other commitments. It also requires keeping your eye on the ball because rules change from time to time. Ignorance tends to be no defence should you miss any updates.
These are some of the reasons why we recommend getting an expert to take care of your nanny payroll. Pay the Nanny has a team of qualified accountants and financial and taxation specialists. For 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.
