Your nanny cares for your kids and keeps your life running smoothly all year long. Come December, it's important to say thank you for those efforts by giving a holiday bonus.
According to a poll of almost 600 Care.com members, 60 percent of families give their nannies a holiday bonus. But many don't know how much to give. And 31% percent of families only give a present, while 9% give nothing at all!
With this in mind, Care.com put together a map of the average nanny bonuses in each state. Click on your state to see what you should be giving. Then continue reading below for answers to some of the most frequently asked questions about nanny bonuses.
Why Should You Give Your Nanny a Holiday Bonus?
You may feel a bonus isn’t necessary because you pay your nanny well and show your appreciation in other ways. However, a holiday bonus is customary. Many people count on it as part of their income.
Jennifer Kuhn, executive editor at Nanny Magazine and a former nanny, says, "Although I believe that no nanny should ever expect a bonus, a holiday bonus can go a long way toward letting a nanny know her nanny family appreciates the work she does."
Kuhn notes that “a nanny may feel unimportant or undervalued if she receives no holiday bonus, while every other nanny on the block does." And if your nanny feels like she's being short-changed, she may start looking for a new job in the new year.
"My wife and I have always paid our nannies a holiday bonus," shares Graeme Gibson, a Seattle father. “There are a number of reasons why, but the main one is that we want her to feel appreciated."
When Would You Not Give Your Nanny a Bonus?
Bonuses are an extra thank you for a job well done. Don't give your nanny a bonus if you're about to let her go for poor performance or because things aren’t working out. Doing so will lead her to believe you're pleased with her work and give her a false sense of job security.
How Much Should You Give Your Nanny as a Bonus?
Most nannies receive between one and two week's pay as a bonus. Check out the infographic at the top of this page to learn the average bonuses in each state, based on a 40-hour work week. Aim for something in that range.
If you live in a major city, the bonus might be more; if you're in a rural area, it might be less. Kuhn suggests you do a little research and ask what other parents are giving their nannies.
The size of the bonus also depends on your family's financial status. Some working parents can only afford a half-week's pay, while others may give their nanny two weeks' or more.
Just make sure it's consistent. If your longtime nanny has grown accustomed to receiving a certain bonus, it could cause confusion and even resentment if you cut corners this year.
What if You Can't Afford a Bonus This Year?
Unexpected expenses may leave you with a tight holiday budget. Kuhn recommends that you factor a bonus into your budget when you first hire your nanny. If you find yourself unable to afford the usual holiday bonus, explain this to your nanny. She’ll probably understand. Maybe rather than giving her one lump sum, break it down into smaller more manageable amounts over a period of time.
Can I Give a Bonus Another Time of the Year?
Some families give nannies their bonuses during their annual review. This is certainly allowed -- as long as your nanny is aware of the timing.
Do I Have to Pay Taxes on the Bonus?
You typically don't think of taxes while you're handing out presents, but your nanny's bonus (whether you present it during holidays or a performance review), is considered taxable income and you need to pay taxes on it -- along with the rest of her income. Because you're an employer, the bonus doesn't qualify as a "gift". Learn more about paying nanny taxes.
Is a Gift Acceptable?
While a holiday gift is always nice, a monetary bonus is traditional. Your nanny is a professional and deserves to be treated like one. Many employees receive end of the year bonuses and so should nannies.
If your nanny is used to receiving a cash bonus, switching to a gift could be taken as a sign of dissatisfaction. But for a new nanny who has spent little time with your family, a thoughtful gift is appropriate.
In addition to money, you may want to give an inexpensive gift from your kids. Personal items such as a new scarf or something related to a hobby are always great ideas. Try these 8 Creative Holiday Gifts Kids Can Make for Their Nanny »
Your nanny is a valued member of your family, and while you're giving thanks during the holiday season, don't forget to show how much you appreciate this very special person.
Gillian Burdett is a freelance writer in New York. Her writing focuses on education, public policy and family issues. Her work can be found here.