Not sure hiring a nanny is a good idea any more...

If you were coming to this from scratch saying that you had one child, that you needed childcare between say 8am and 6pm. Then a nanny would not be what I would first be suggesting... I would be suggesting a Childminder.
Are those the sort of hours you are looking at? If so, have you visited local childminders? Have you ruled out childminders for some reason?

It's certainly not the perfect solution to all of your problems and when things go wrong, they go wrong in a very bad way. I agree with all the good points re nannies above, but you've got to be prepared to deal with all the problems if they arise, and the time you spend/hassle you get if they happen would probably be much greater than the hassle of using a nursery. You should also be aware that the law generally sides with employees, not employers.

If you're keen on a nanny, make sure you recruit the right one (easier said than done) and set everything out clearly from the beginning, esp if it's a more complex arrangement like a nanny share.

Mumsnetters will help you with preparing contract if necessary, or just us a standard contract like the one at NannyJob. You will need to adapt it a bit as you are doing a share. Also being a share does complicate things a bit, in that you and the other mum need to agree things - best done in writing so you don't forget what your agreement is.
Get a payroll company like PAYEforNannies to do the monthly payroll. They will take you through the processes required to register as an employer and tell you what to pay to HMRC and when to pay it. As it is a share the payroll company will be able to advise you with regard to splitting payments if necessary.
Pros and Cons are similar to Childminder v Nursery, though with a nanny you have greater control than you would if you used a childminder... plus the nanny only cares for your children (or your children plus the share families children).
Need to know a lot more about the share arrangements really to be able to give more advice... as if the nanny isn't working in your home, then the advantages to you are a lot less I feel. Also if the hours you need childcare are pretty standard, then the advantage a nanny give of early start, late finish times isn't needed.
I think you have a baby boy, so the care in your home will be a plus point as if your son sleeps in, you don't need to wake him up. Your son will be familiar with his surroundings, so his separation anxiety may be reduced. He can be taken to places he likes and go back home again when he's had enough - he sort of controls things a bit... nanny is there to meet all his needs.

Why did you decide you wanted a nanny? What were the reasons for not going with a nursery or childminder? Think about what it was that made you consider a nanny in the first place... there must be reasons why you did feel that type of childcare was most suited.

Pluses for us:

• No nursery sickness; everyone I know goes through a whole term (at least) of kids being sick being sent home from nursery, then having to take day off as they get used to new set of germs. Nanny's will stay home with them and usually don't go sick themselves - can have a duvet day

• You get to pick a bit more how they spend their time e.g. more time outside, choice of activities etc.

• Don't have to get them ready/fed in the morning

• Don't have to panic if 10 mins late (just let the nanny know and reciprocate)

• Known babysitter for evenings out

• In our case supports bilingualism as speaks same language as DH

Personally, I don't find the contractual stuff hard; get an agency to do payroll; they or MN folk can give you sample contracts etc.

It's swings and roundabouts really.

My DD loved her nursery, and so did I.
The part I didn't love was sitting on the tube stuck in a tunnel hoping I wouldn't be late for the pick up, rushing home with her and then getting about 10 minutes with her before she wanted her bed (as nursery was a long, full-on day). With a nanny mornings and evenings were way easier in general. The admin does suck though.

Sorry I think a good nursery beats a nanny any day assuming you work standard hours and pick one either near to home or work. You don't have to worry about any sort of employment las, you don't ahve to worry about sick leave and maternity leave. You have the assurance you're not leaving your child with one total nutter - although of course as recent events have shown no arrangement is 100%, your child gets the compant of others and use of a wide range of toys and activities. You pick carefully then you pay your money and that's it, done! The one thing you don't get is a single person caring for your child. All I can tell you about that though is that my personal experience has been that this is not an issue. Dd3 adores the whole team at her nursery. They have been very stable in terms of turnover with only 2 people leaving in 18 months - and that was for maternity leave! Lots of cuddles, lots of focus on her as an idividual - we are all very happy. A good nanny is great of course but so is a good nursery. Have you looked at any?