Hiring a nanny requires more than just finding a suitable candidate. When you hire someone to work in your house and take care of your children, you become an employer. Like all employers, the law imposes specific requirements and duties on you and your employee. You must make sure you comply with all the relevant federal, state and local laws whenever you hire your nanny. Not doing so can cause problems down the road.
Step 1
Research your options. You can hire a nanny in one of two ways: as an employee or as an independent contractor. Hiring a nanny directly usually means the nanny is your employee, while using a nanny service means the nanny is an independent contractor. However, this distinction is not always clear. Review the IRS and state tax agency rules governing employees and independent contractors and the legal implications of each.
Step 2
Interview the nanny. Whether you go through an agency or hire a nanny independently, you should take the time to interview all potential candidates.
Step 3
Verify legal statute. One problem you don't want to have to deal with is the prospect of hiring a nanny who isn't legally authorized to work in the country. Have the nanny fill out U.S. Citizenship and Immigration Services (USCIS) Form I-9. Your nanny must provide proof of their legal right to work, though you do not need to file Form I-9, merely keep it in your records.
Step 4
Get a tax ID number. Whenever you hire an employee you take on tax responsibilities. Your first step is getting an employer tax identification number from the Internal Revenue Service so you can pay social security and medicare taxes. If your nanny is an independent contractor, you do not have to pay these.
Step 5
Obtain insurance. Having a worker in your home brings up significant liability issues–particularly due to injury or damage and who will pay in these circumstances. State laws typically require that all employers carry workers compensation and unemployment insurance. Check your state's laws before you hire your nanny.
Tips and Warnings
- Consider an employment contract. Though not always required, employment contracts help define your nanny's job responsibilities and expectations.
- Talk to a lawyer. Some key questions arise whenever you hire someone, such as whether or not your nanny is a contractor or an employee. This question isn't always easy to answer, so consult an attorney before you do so. Your attorney can also help you protect yourself by drafting employment contracts and making sure you file the appropriate legal documents.
