Minimum Pay
A live-out nanny is covered by the National Minimum Wage and employers must
pay at least the National Minimum Wage for all hours worked by a nanny. (Live-in nannies are not covered by the regulations.)
PAYE for Nannies monitors all new government regulation in such areas
and can advise nannies if their current pay meets these minimum standards.
Some confusion can arise as the pay rates set out in the National Minimum
Wage regulations relate to gross pay and most nannies tend to think
in net pay terms. The gross pay equivalent of any net wage will generally
be significantly higher and so a rate of pay which appears to fall below
the National Minimum Wage in net terms, will actually be above it in
gross terms. Other factors which can make the calculation more complicated
are the age of the nanny and the hours she works
Unfortunately, it is not a simple calculation to check if any net pay
rate is above the gross pay rate specified in the National Minimum Wage
regulations but a couple of examples are given below and as mentioned
above, PAYE for Nannies can always perform a calculation for individual
circumstances. All the examples below assume a nanny has a "Standard"
tax code of 543L. As can be seen from the examples, some results are
surprising!
|
|
|
A 22 year old nanny is paid £5.30 per hour net and
works for an employer for 16 hours a week. This is her only
job. This rate is BELOW the National Minimum Wage and
is illegal.
A 21 year old nanny is paid £3.86 per hour net and
works for an employer for 50 hours a week. This is her only
job. This rate is ABOVE the National Minimum Wage and
is perfectly legal.
Please note, from October 2008, when the minimum wage increases, any hourly rate of £5.73 per hour
or above (net or gross) for a nanny who is at least 22 years
old will be legal and any hourly rate of £4.77 per
hour or above (net or gross) for a nanny who is between
18 and 21 years old will also be legal.
|
|
|
