Today's typical nanny tends to see herself as a professional independent woman with career aspirations, who is increasingly aware of her employment rights. Why then is the highly unprofessional practice of agreeing a net (take-home) wage still so widespread among nannies, nanny agencies and parents?
This outdated convention can cause a number of difficulties for nannies and their employers alike, the more so since changes introduced in last April's Budget.
First, what exactly do net and gross pay mean? Your net wage is the amount you have in your hand at the end of each pay period, after statutory deductions - income tax and your employee's National Insurance Contribution (NIC) - have been made from your gross wage. Then on top of your gross wage your employer must also pay employer's NIC. Together these figures make up the true cost of employing you. The difference between your net wage and the true cost can be as much as 50 per cent more, and this may come as something of a shock, especially to first-time employers.
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