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Have overpaid nanny who is leaving. How do I handle this well? Advice from nannies and employers pls

(39 Posts)
tiggersreturn Thu 14-Jul-11 14:01:57

My nanny works part time in school term and full time in school holidays. We agreed at the start of her employment that she'd rather be paid an averaged sum each month than the actual hours she works as it makes it easier for her to manage financially.

I'm about to go on maternity leave and my nanny was aware of this. I was going to offer reduced hours in the school holidays (as I can't afford to pay full ones and have no need of them if I'm at home) but before I could do so she handed in her notice after an incident.

I have just managed to get an answer out of my tax people on what the salary position is. If I don't pay her for this month I will have overpaid her by about £700 because of the hours she's worked and when she has taken her holidays (during school holidays generally).

I have no intention of trying to reclaim this from my nanny. I very much doubt that she has that sort of cash sitting around. In fact she probably owes me more than that because as a goodwill gesture (and to prevent her coming into work sick) I've been paying sick pay where the contract only provided for SSP after the usual period.

What I'm more concerned about is that she is obviously expecting to be paid for working her final month (part of which is holiday) and while I do sympathise with her position I can't afford to overpay her anymore.

How would you recommend handling this? I have a leaving present for her but that's hardly the same as your rent money......

Her last working day is next week and I'd like to explain what is about to happen. When is the best time to do this?

springboksaplenty Thu 14-Jul-11 14:04:53

On the last day.

azazello Thu 14-Jul-11 14:06:08

As soon as you can manage without her.

DandyGilver Thu 14-Jul-11 14:10:57

I think maybe a letter including a spreadsheet with what she has been paid over the year and including a copy of the contract which details the salary agreement.

If she is obviously expecting to be paid then it would be kind to remind her of the position quickly, although if you think that she would then just stop turning up maybe you don't want to do that.

springboksaplenty Thu 14-Jul-11 14:14:21

To be slightly more helpful, I still suggest telling her on her last day or, as azazello suggests, on the last day you actually need her.

I would perhaps detail in a letter the hours she has worked, the sums paid to her and what she actually was owed. Then highlight the overpayment and state that you will not be seeking a refund. That then puts her in the position of realising how generous you are being (and you are!) rather than making it seem as if you aren't paying her, when in actual fact you have (over)paid her in advance.

DandyGilver Thu 14-Jul-11 14:19:19

Yes definitely highlight that she has been overpaid.

(A girl who worked with us had real difficulty grasping that the holiday allowance was for the whole year and if you leave after 3 months of the year having taken 5 weeks holiday there will be an element of clawback in the last month's wage. She was talking about going to the papers!)

Karoleann Thu 14-Jul-11 14:24:43

Is it in her contract that you can deduct money from her salary if she's taken more holiday than accrued?

If it is then I wouldn't mention it

If she queries it you can print out this page

www.direct.gov.uk/en/Employment/Employees/Timeoffandholidays/DG_171945

and point it out in the contract.

tiggersreturn Thu 14-Jul-11 14:25:34

Thanks. I was wondering if it's worth printing out the spreadsheet from the nannytax people and going over the hours with her along with our original agreement to double check if there were any more hours that she might have worked which aren't included. However, my records are pretty good and all it's likely to do is just reduce the amount of overpayment - not pay enough to give her anything for this month.

I'm nervous of doing it before she leaves (early next week) in case she doesn't turn up but equally I feel morally obliged not to have this come as a complete surprise on her final day.

The real problem is that August would have counted as the equivalent of 2.75 school months and by not working it this has caused the problem.

God I hate this!!!!!

tiggersreturn Thu 14-Jul-11 14:26:29

It is in her contract and I think the only thing I can do is point out how "nice" I'm being by not reclaiming. But equally I feel dreadful that she's not going to have any income coming in this month

wakeupandsmellthecoffee Thu 14-Jul-11 14:58:56

what was the incident . I am a nosey cow and I make no apologies for this . lol . And I think you have to remind her about the money situation .

HavePatience Thu 14-Jul-11 16:39:36

You have to tell her. Imagine your boss suddenly told you that you've been overpaid and you'll have no income this month as a result. Wouldn't you rather know ASAP so that you could make alternative financial arrangements instead of them waiting until the last day they need you???

Novstar Thu 14-Jul-11 16:55:01

Well I'd tell her now, because I like to try and be nice, and expect the nanny not to return the money or turn up at all. It's the crap you take when you're an employer. I've lost money several times this way (although not as much as £700)... I learnt not to overpay anyone at any stage.

tiggersreturn Thu 14-Jul-11 16:56:39

Have just spoken to Acas and payroll people again. All the overpayment relates to holiday taken. Acas' suggestion is come up with some sort of paying back plan but since employment is terminating I'm not entirely confident of this working. What a mess...

HavePatience Thu 14-Jul-11 17:43:29

You are thinking of having her pay it back? Seriously.... Imagine for just one millisecond that your boss ha been overpaying you or dh (whoever higher earner is) and you had no idea, you just thought it was your salary or employer being generous. Then, just as your job is about to end, your boss tells you that either a) you'll be paying back the overpaid amount or b) you will work for no pay for your last month.
I know that personally while I'd feel horrible about being overpaid and want desperately to make it right, I probably wouldn't be able to afford to. I would be really angry with my employer as it would be their mistake and if they had done it properly from the start or told me MUCH sooner than my last month of employment, then it wouldn't be such a financial nightmare for me paying my bills.

harrietthespook Thu 14-Jul-11 18:11:13

Havepatience
What you've described is not the sitaution with the OP. It is not their mistake. Yes the OP agreed to paying her this way, but the nanny should, in fact, be on top of what was agreed between herself and her employers in the contract enough to realise a potential problem could be emerging depending on at what time during the year she gives notice.

It's not a question of the OP making some kind of adminsitrative error and taking the nanny by surprise.

OP - I think the suggestion of letting the £700 go and showing her nannytax's workings is the right way forward.

elphabadefiesgravity Thu 14-Jul-11 18:34:55

Dh was overpaid thought no fault of his own and it came to light after he had left the employment.

It amounted to £2000 and he had to pay it back. However this was done at a rate of £100 per month for the next two years. It was taken directly out of his bank account by direct debit and he was invoiced and sent a statement each month.

I think you should give her the option - either deduct it from her final months wages or offer her the option to pay it back at an agreed rate.

HavePatience Thu 14-Jul-11 19:25:53

Sorry Harriet and OP, I misunderstoodblush

springboksaplenty Thu 14-Jul-11 19:30:15

I think that if she had any sense she must have realised that something like this was going to happen - she realised the agreement to spread payments was based on an entire year working, therefore if that year was cut short, she may potentially have been overpaid.

catsareevil Thu 14-Jul-11 19:39:10

The nanny should be aware that this is the case. She will know that she is being relatively overpaid during term time and relatively overpaid during holidays. I wonder if the reason that she hasnt asked you about it is because she knows exactly what the situation is, but is hoping that that isnt the truth, IYSWIM. If she thought that she migh possibly be due any money then I think she would have asked you how much it was, as it is obvious that she would not be due a full months wage.

catsareevil Thu 14-Jul-11 19:39:51

Sorry, that should say underpaid during holidays

nbee84 Thu 14-Jul-11 19:54:43

elphabade has misunderstood too - even if the op doesn't pay the final month's salary the nanny still owes £700.

I think the op is being extremely generous when she says that she doesn't intend to reclaim this money back as legally she could.

I was in the opposite situation - I worked term time only with an annualised salary. Started in the September, was made redundant at the end of April and my boss was thinking in terms of 'well, nanny has had 6 weeks holiday already so it should work out about even' We had to sit down and work out actual amount of hours worked and what I had atually been paid vs what I would have been paid for those hours for her to see that she owed me a final payment of over £600.

boysrock Thu 14-Jul-11 20:28:59

right I'm going to go against the grain here.

1)you chose to pay her sick pay instead of ssp therefore you have not overpaid her and this should not enter into your calculations. That was your decision.

2)Your nanny appears to be on annualised hours, a mutual choice, so i would argue she hasn't been overpaid from that respect either. There are only 13 weeks school holidays so this must balance out compared to 38 weeks part time?
If she has taken too many holidays up until her notice period then rather than her not being paid, (which i imagine could be disastrous for her), i would suggest she either continues to work up until her annual leave has levelled out and alters her leave date accordingly. I assume she does get paid holidays? Her current annual leave may need cancelling.

Or the other option you've already suggested that she pays you back.

Sorry I really dont think it ethical to just not pay someone without any warning. I think you both need to sit down and work out a better solution.

Unless the "incident" puts a completely different light on things..

catsareevil Thu 14-Jul-11 20:32:39

boysrock

She isnt taking the sick pay into account.

tiggersreturn Thu 14-Jul-11 21:41:09

Just did really long post and mn logged me out half way through and lost it!!! angry

As explained below if I counted sick pay she'd just owe me more.

I decided to sit down with her and the figures and explain it all tonight and take the risk of losing childcare for rest of my working time because morally I felt I couldn't do anything else. (Before anyone says this was too late I only found out the exact situation today. I'd asked my payroll people - who aren't nannytax I just think of them as the people who do my nanny's tax- to calculate this for me over 3 weeks ago as I suspected the amount would be low not minus).

It was actually fine because she had also been working on the assumption that there would be very little if any money coming from this month so was not so surprised. She was surprised by the amount she owed but when I offered the option of either receiving nothing this month and me wiping off any outstandings or receiving a small amount this month as an advance to cover her outgoings and doing an arrangement for paying back the total amount over a number of months she very firmly went for the first option. So all thankfully appears to be ok which is a big relief.

Yes I do agree that it is an unfair position to be in but I did explain when I proposed this structure that there would be problems if employment ended earlier. Lots of learnings if I ever use this type of structure again which won't be for quite a while.

Thanks for the advice.

Oligo Thu 14-Jul-11 21:42:11

Is it in the contract that you pay her pcm or per hour or other? maybe I missed this bit when reading through. Teachers do not have to pay back money or get owed it like this. Although their notice period is long.

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