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Original poster

An idle question re nannies - why is their pay always stated net?

37 replies

spicemonster · 13/02/2009 19:34

I have no intention of employing a nanny but I've always wondered why this is. As far as I know, the nanny job is the only one that is talked about in net terms. Is there an historical reason for this? Is it convention? Does it help/hinder working out how much you actually have to pay?

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tankie · 13/02/2009 22:46

I have no idea what my gross annual salary is

nannynick · 13/02/2009 22:36

Thanks for the history BoffinMum, expect you are right... nannies are one of the few remaining servants.

Tax free amount each year quite goes up, rather than down, so nannies who have a NET salary loose out on that. Employers can loose out big time, if the nanny gets any deductions made at source - such as repayment of Student Loan, repayment of some fines. With nannies now more likely to be doing 3-day, 4-day a week jobs, the tax side of things can become complex especially if tax their code is split between employments. For nannying to be seen as a professional occupation, we need to have NET wages being a thing of the past. Some agencies do advertise Gross Annual Salary jobs, but alas many still don't - probably due to them being run by an ex-nanny, rather than someone from a recruitment background.

BoffinMum · 13/02/2009 21:37

Prior to the introduction of National Insurance in 1911, as domestic servants, nannies would have been paid a weekly amount without this being deducted, and they would probably not have been liable for income tax either (income tax was only about 5% anyway). This was the first step towards the modern welfare state.

Initially, as I understand it, employers would have often paid the weekly 4d National Insurance charge on behalf of their staff, because they would have been used to picking up medical bills, etc for them anyway.

Over the subsequent century liabilities for tax and NI have gradually increased. However as nannies were still regarded as domestic servants, the archaic habit of paying them net seems to have continued.

I think 98 years after the National Insurance Act, we should abolish the practice of quoting net weekly salaries altogether, otherwise nannying can never be seen as a self-respecting profession.

chisigirl · 13/02/2009 20:49

I don't know either but our current nanny is very clued up and told me her salary expectations on a gross basis. I wonder if this (thinking gross not net) is now being drilled into nannies during their training.

tankie · 13/02/2009 20:49

Net is generally better for the nanny as the employer pays any tax increases.

catepilarr · 13/02/2009 20:49

i think it comes from days when nannies were payd cash in hand, no taxes and ni?

tankie · 13/02/2009 20:48

The problem with agreeing net is the gross changes depending on how many hours the nanny works and if part time, whether or not she has another job.

Original poster
spicemonster · 13/02/2009 20:48

Ah that is very interesting TFM. I always thought it was to benefit the nanny but maybe it is the employer? It is all most mysterious ...

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TheFallenMadonna · 13/02/2009 20:47

I don't know anything about it but I do know that nannynick is very anti the net salary.

Original poster
spicemonster · 13/02/2009 20:44

I am going to keep bumping this until someone tells me!

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tankie · 13/02/2009 20:15

No idea why, but it does make things more complicated from the employers point of view.

Original poster
spicemonster · 13/02/2009 20:03

Bump - c'mon people I want to know!

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