Nannies and ad-hoc work

[Shattered04]

We employ a nanny. Assume for one moment that for whatever reason, her employment with us comes to an end, but she still remains a nanny by profession, perhaps employed by another family.

What is required legally (e.g. taxes, contracts) from either/both sides if we wanted to occasionally - not regularly or often - use her services for babysitting, housekeeping, or ad-hoc days in the school holidays? Can we even do that legally without re-employing her? What actually happens in practice?

I've heard a variety of things ranging from the fact we'd have to keep her employed even with zero hours, to how we'd be legally in deep trouble if she decided to not pay her taxes even if she claimed to be self-employed to us. Is there really this much red tape?!

Thanks!!

I do ad-hoc work through my business and do occasional work for an ex-employer. I have a handful of clients for whom I do ad-hoc work, some I may see once a month, some several times in a month, others only a few times a year.

Your nanny may not be running their own ad-hoc childcare business and may not want to start one just to care occasionally for your children. They might though, especially if they take on several other families such as doing evening babysitting.

So certainly possible if your ex-nanny want to run a business.

An alternative: Some payroll companies only charge you for months when you have a nanny. So you could employ someone for very short periods of time, keep payroll active and some months would have zero payroll cost. Talk to your payroll provider, NannyPaye have done this before so I expect others have as well. Pension admin may complicate it but paying someone under £833 per month would not be auto-enrolled, though could be eligible to opt-in.

Thanks nannynick - that's very interesting! We do actually use NannyPaye so that's good to know. I'm guessing we'd still need to give her holiday, although if it's ad-hoc, sick pay would not apply. I know all about the £833 total.. the main difficulty would be the summer holidays I guess.

What would a contract look like in this scenario - would it effectively be a zero hours one?

I don't think the nanny would want the hassle of setting up a business again (she used to be a childminder) so it's good to know there is this option.

Holiday would be done on casual basis, ACAS has a guide but payroll can help as well. Basically it's 12.07% of time worked and it could be added on to the pay.

Zero hour contract of some kind, it's going to be very specific to the situation.

Does you nanny want to do ad-hoc work? They may not, so talk to them about it at the earliest opportunity following you knowing for sure that what they current are doing is coming to an end.

Thank you! Due to the nature of school holidays/term times being different, all nannies I've employed before I've had to work the holiday out manually in hours anyway, so I'm very used to that. Normally though, they would take the holiday days, but paying the holiday pay is totally fine with me.

I have discussed it with our nanny, she's happy with this arrangement. She wants to work for another family who can offer her more hours than we can. However, we both would like her to continue working for us ad-hoc in the holidays/babysitting etc as mutually convenient, so this solution definitely works for both of us. I hadn't even realised it was an option before!

When agreeing wage, agree it as a gross figure. You do not want unexpected surprises if HMRC changes tax code allocation, which they will do, or nanny should get them to do, as nanny will want their personal tax allowance allocated to the job paying the most.

Yep, we already pay her gross, thanks to the good advice I read on here a few years back when we first started using nannies!

I did wonder about the PAYE situation. With the large reduction in hours she won't get anywhere near her personal allowance with us now (she wasn't close before, either) However, if her allowance goes to her other job, it could get interesting - particularly if she doesn't use her full allowance with the other job either.

HMRC will allocate tax codes, they may need prompting to do that which your nanny can do by calling them, or using the app/personal tax account. As the pay from your job would be variable she may be able to get HMRC to allocate as much as possible of allowance to the job where the income is steady, then remainder gets allocated to job with you. It's a bit of a pain frankly... can often mean having too much income tax paid which HMRC then refunds at some point.

Thank you very much! I've had to deal with a split tax code before. I'm guessing the onus is on the nanny to reclaim anything overpaid at the end of the financial year, and not us?

I'm also assuming the responsibility for giving us a tax code lies with the nanny, and this isn't something I need to look into other than telling NannyPaye what her code is when she tells me? Goodness knows as an employer there's already enough to do..

Up to the nanny to sort out with HMRC. When they start a new job they complete new starter paperwork which gets the ball moving... then they wait a bit and if HMRC does not automatically change tax code, they can request a change using the HMRC App, or by calling. HMRC issues the code directly to payroll provider, or to employer... so if you get a coding notice letter about your employee you then email a photo of that to your payroll provider.

Wonderful, thank you so much for all your help, and giving me the means to sort out quite a sticky situation!