How to Navigate Nanny Raises and Vacation Time
Nanny Tax & Payroll

How to Navigate Nanny Raises and Vacation Time

by Martha Scully

How to Continue to Show Your Nanny You Care in a Long-Term Agreement

As is true with any employment agreement, it’s typical for parents to revisit and potentially increase their nanny’s pay and vacation benefits on an annual basis. It’s an act of gratitude that can go a long way in maintaining a positive relationship with you and your nanny.

But what happens when, after a few years, you can’t afford to increase her pay or provide her with more paid time off? Here are a few things to consider as you work to show your gratitude over time by continuing to improve your nanny’s benefits package.

Increasing Annual Salary or Hourly Rate

Like traditional employees, nannies are typically paid one of two ways: salary or hourly. A salary-based payment structure is usually better suited for long-term relationships where your nanny will be caring for your child or children full-time for multiple years. Alternately, an hourly payment plan works best for a more flexible arrangement where you don’t need your nanny for a full work week or full calendar year.

In both payment systems, parents often give nannies an annual raise; that raise can be distributed as an increase in annual salary or hourly rate, depending on the terms of employment and pay structure. At the minimum, however, an annual cost-of-living raise is appropriate.

For at least the first two to three years, you will want to consider increasing your nanny’s pay. If you decide to, the size of that raise is dependent on both the experience level of your nanny and the location of your family. In some parts of the country, a $10 per week or $0.25 per hour raise may be appropriate; in more expensive cities, however, you may need to consider a larger increase in pay to account for an increased cost of living.

A supplemental or alternative solution to an increase in pay is an annual bonus. Giving your nanny one or two larger payments throughout the year, around her birthday or the holidays, is a great way to show your appreciation without undertaking an additional monthly cost.

Offering Additional Paid Time Off

It’s appropriate to give your nanny both paid vacation time and paid sick time. If you’re in a long-term arrangement, you might also consider giving your nanny paid holiday time, and in special circumstances, paid bereavement.

In addition to giving her vacation time to enjoy on her own, consider paying her to accompany your family on your own vacation. She’ll get paid for the time she’s with your family and also be able to enjoy visiting a new city. If you want to go the extra mile, give her a couple nights off and a little spending money so she can enjoy seeing the sights solo and recharge for the next day.

As is true with any other profession, paid time off has a cap – especially if your own paid time off doesn’t increase. After she’s worked for your family for several years, you may not have the means to increase your nanny’s paid leave benefits. However, there are other ways to show your nanny you appreciate her that don’t involve salary increases or paid leave benefits.

Showing Your Gratitude in Other Ways

After your nanny has hit a cap on her benefits (and even before then), you can still show your appreciation in lots of other ways.

Inviting your nanny to stay for a nice meal after her shift in order to enjoy some time with your family gives you an opportunity to bond while showing your appreciation.

Alternately, a small gift for no reason, fresh flowers, birthday and holiday gifts, a day at the spa or a gift certificate are all great ways to show you care.

Another more personal treat is a surprise half or full day off with tickets to a movie, museum, concert or other event you’ve seen her show interest in.

You can also get more creative with your nanny’s benefits to show her you care over longer periods of time.

Providing her with a cell phone plan can be as easy and affordable as adding her to your family plan. While that might only have a small impact on your monthly bill, it could mean eliminating an entire monthly expense for your nanny.

The same is true with a gym membership; if your gym family plan lets you add additional members, consider extending your nanny a pass as part of her compensation package.

She’ll appreciate the gesture, and you’ll benefit from having a healthy role model watch over your children.


As is true with any employment arrangement, it’s best to have an open and honest benefits conversation with your nanny on an annual basis.

You can also use this time to talk about what she’s doing well and ways she can better care for your children.

She’ll work harder for your family if she feels she’s taken care of, and you’ll have an idea of what she’s looking for in the future.

The result will be a healthier and happier relationship between you and your nanny, and ultimately your nanny and your entire family.

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About the Author
Martha Scully
Martha is the founder of Martha has been featured as a Child Care Expert in hundreds of publications across Canada including The Globe and Mail, CBC, Today's Parent and The National Post, She lives in British Columbia with her husband and two daughters.