What's the best wage arrangement for potential nanny?

[Mamabols]

Hi, we're hiring our first nanny and would really appreciate some advice on what sort of pay to offer a potential nanny candidate:

To describe the job:
-live-out nanny
-part time work during school term and FT during holidays
-Our 3yo son will be going to nursery 8:30 to 3:30, 5 days a week
-the nanny will be coming to get our son ready for nursery, dropping him off and then picking him up, and providing after school care until we get home.
-Occasionally, late nights and/or overnight care may be required
-We're anticipating FT care during the holidays -although we are looking to break that up with some days at holiday club/playscheme
-General nursery/household duties included

Where we're having difficulty is being able to say exactly how many hours a week the job will entail (for now). This is because mum works shifts in the hospital and number of hours/week as well as start/finish time will vary (for instance, I could have a week of 9-5 and the following week 8am to 8pm or some combination thereof) and dad is a contractor who commutes quite a bit. It will become clearer closer to the time (usually rota comes out a month in advance) but of course, we would need to have sorted out childcare before then.

At the moment we've estimated based on a start time of 7:30am and finish time of 8:30pm - which during term time would end up about 30hrs/week and during holidays 65hrs/week (assuming no playscheme)

What we thought would be best would be to set a rate for a certain number of hours a week and then pay an overtime hourly rate for any hours we go over.

A potential candidate has asked for £150 net/week during term time and £300net/week during holidays (using our above estimate for the number of hours) and £6/hr for 'overtime'. She has a toddler that will be accompanying her to work most of the time and has mostly nursery nurse experience (2yrs) and a few months each of nanny and mother's help experience

Question:
It seems reasonable, but £300net is quite a hefty amount for what could be about 20 wks/yr. Is this the going rate, given the potential number of hours (we live in East Anglia)

1. She suggested paying wage 'pro rata' to spread out the cost, I suppose. But would this be practical given the varying number of hours

1. Is there a better way to deal with pay in a situation like hours with varying hours?

Advice would be much appreciated as we've never done this before.
Many thanks

It's late in the evening so I won't even attempt to do work this out now... sorry, going to bed.

However, a question: How many weeks is Term Time, and does that change once he is in School?

Also, what have you decided to do about when the nanny can take their holiday entitlement?

Sorry it's such a long post/question. Was trying to include enough detail to be helpful.

Term time is roughly 15w each (half term inclusive) and will be the same when he's in school.

To be honest, haven't thought as far as how we'll work it out when the nanny takes holiday - perhaps a combination of after school club + shorter shifts + holiday?

1. £300net is £375gross, which for a 65 hour week isn't even minimum wage for an over 21 year old. It works out to £5.76, NMW is £5.93. The NMW is a gross figure. Admittedly min wage would only be £307net but that's a gross of £385 and a total cost to you, including Employers NI, of £420. Term time you will need to pay over the odds to cover the split shift element, plus they won't be able to have another job.

1. It's quite normal for nannies who work reduced hours in term-time or term-time only to have an annual salary which is then divided into monthly payments based on an estimation. You can then just add overtime to the payslip on a monthly basis.

1. Annual salary based on (20 x 65) + (32 x 20) = 1,940hours/year. That averages out to 37.3 hours/week. You could agree a fixed hourly salary based on that figure then pay monthly rather than working off a weekly salary which varies.

You obviously have a problem if nanny leaves part way through the year in that case and holiday would need to be worked out in hours rather than just using 5.6weeks.

The other option is to have her fill in a timesheet for each month and have an agreed minimum figure if she doesn't hit the hours, which given the distribution of school holidays is unlikely.

What about agreeing a set hourly rate to cover all the work and having a guaranteed minimum each week/month? So say she works for £6 per hour, and you guarantee she will be paid for a minimum of 130 hours per month.

Pay her in GROSS. Paying in net leaves you open to any tax rises. I would pay her for time worked monthly in arears. Paying her for work she has not yet performed is risky. What if she gives notice. Will she then owe you money? will you get it? People do this with childminders, but they are not employees and so not a comparable situation.

To be fair to her I think you should agree when she will be advised of the scedule (i.e. month in advance or whatever is feasible)

Spreadsheet - a possible way of splitting into monthly payments. However it all seems a bit messy.

You have several issues to contend with:

National Minimum Wage, rises to £6.08 in October 2011 for those aged 21 or older. So I would suggest that being the minimum pay amount considered.

Whilst your son is at Nursery, or Playscheme, who would collect him in the event of illness? Nanny might (as overtime) but doesn't have to as would not be contracted to do anything other than the hours specified.

Nanny would need to take Paid Holiday at some point. When could that be taken? During school holiday periods perhaps, but those days nanny would be working more hours than they would during term time.

Holiday entitlement therefore needs to be calculated in Hours, so that holiday could be taken on a term time day or a school holiday day.
Holiday Calculator - I think it's 228.4 hours holiday.

Agree with Strix, having a fixed number of hours per month (regardless of if you use them all or not) may be easier. Any extra can then be added as overtime. Holiday I think can then be based on the average working hours - Atypical Workers Holiday Entitlement.

Thank you all for your advice and suggestions (and that impressive spreadsheet, nannynick !) I'll discuss with the prospective nanny and see -maybe we'll have a trial of 3months using the fixed minimum hours +overtime and see how that works.