Employee benefits will greatly help you attract and retain the highest-level of nanny care. It is also strongly recommended that you treat your nanny and any other household employees like professionals and reward them accordingly. By awarding an attractive benefits package, you will maintain a satisfied nanny within your home which will lead to long term stability, a happy family and solid life balance.

Medical Insurance Coverage

Health care insurance coverage is a priority for many nannies, because of the high cost of coverage and medical fees. However, the cost of coverage can be high for you, the employer, as well, especially since most households require the assistance of only one or two employees (such as a nanny and a housekeeper). Thankfully, there are various options on the market, now, more than ever before, which make this type of coverage feasible.

It is your choice to provide health care coverage as a benefit, except for employers in the state of Hawaii. Hawaii mandates that all employees who earn a certain level of income must be covered.

You have the ability to offer your nanny various forms of health care plan options. The four main plans follow:

1. Health Maintenance Organization (HMO). This is a member-based organizational plan that provides health care at an affordable cost, with an emphasis placed on preventative care.
2. Closed Panel HMO. Also a member-based organization plan, except this plan provides its own facilities and clinics and employs the medical staffs who works within the closed panel plan.
3. Preferred Provide Organization (PPO). While the PPO plan operates much like the HMO organization, the PPO option was formed to control managed care and health care costs. The main difference between HMOs and PPOs is that doctors are not employed by the PPO, nor are the facilities or clinics. Additionally, there are not referral requirements, so a nanny can see a doctor whenever he or she chooses.
4. Major Medical. This health insurance policy comes with high deductibles to cover serious health problems and conditions up to a certain limit or reimbursement maximum.

Health Reimbursement Account

A Health Reimbursement Account (HRA) is a creative option available to all employers as a key nanny benefit, regardless of your budget. This sort of plan is growing in nationwide popularity because the plan is employer-sponsored and reimburses household employees for medical care expenses, based on parameters set by the IRS.

The key with this benefit plan is allocating a predetermined amount of money for your nanny. The money in each account is not subject to employment taxes which will help you and your nanny take advantage of the lower premiums offered by major medical plans to help keep costs under control.

Retirement Plans as a Benefit

In some cases, you might even consider a retirement plan. An Individual Retirement Account (IRA) is a savings plan authorized by the federal government to help people accumulate funds for retirement. Both, traditional IRAs and Roth IRAs will allow your nanny to contribute 100% of his or her earnings up to the plan’s specified maximum dollar amount. The main difference between Roth IRAs and Traditional IRAs is that Roth IRA contributions are not tax deductible. However, Roth IRA principal and interest accumulate tax-free. For the most part, a nanny might prefer a Roth IRA as a means to gradually build a retirement egg without the worry of paying taxes at a later date.

Life Insurance

Life insurance coverage is not mandated by law; however it is a desirable employee benefit your nanny may appreciate. The main purpose of life insurance is to provide a death benefit to your nanny’s family, in order to replace lost income and protect against financial loss in case of untimely death. Term life insurance pays a death benefit to named beneficiaries in the event the insured dies during the term in which the policy exists. Permanent life insurance is designed to provide long-term insurance coverage for your nanny for his or her entire life, up to 100 years.

Educational Assistance

Educational assistance is an attractive option that can add to a nanny’s workplace satisfaction. Often, however, a nanny’s educational advancement must be pursued outside of regular working hours, which could potentially lead to conflicts. This employee benefit is entirely up to the household manager to set-up and maintain. It is recommended that you put together an outlined plan in an employee handbook, prior to hiring your nanny. In doing so, he or she will have immediate access to the exact educational pursuits you plan to cover, which might include; tuition, books, specific coursework, fees, etc. Be precise to ensure your nanny understands what is required on her behalf to pursue your educational assistance offer.

Another attractive option is the offer to pay for professional membership fees, industry conferences or trade journal subscriptions which coincide with your nanny or manny’s interests.

Flexible Work Hours

Flexible work hours are not an alternative to personal time or sick leave. A flexible work schedule is most often an arrangement made for the long-term, which allows your nanny to work a full work-week but at hours which may be non-standard. An example of this might be if your nanny has a class to attend two days a week, at which time a grandparent will handle the child care duties. The trade-off is that the live-out nanny is willing to spend nights in the home, with the children, when the parents are traveling for work. This sort of benefit option may not fit all household schedules. However, suggesting the option may prove to be an attractive option to some nannies depending on situations and personal lifestyles.

Prepaid Legal Services

This is a unique value to offer a nanny who may need to seek legal advice and representation at a point, due to unforeseen circumstances. Examples of potential situations that may require legal counsel include citizenship, divorce, adoption, car accidents, etc. Prepaid legal services are typically made available through subscription plans. Again, this sort of benefit is solely up to your discretion, as the employer, and must be outlined in the employee handbook you prepare for your nanny upon employment.

Use of Personal Property and Facilities 

It is a good practice to offer use of your personal property and facilities outside of work. This will not only prove to be a nice benefit offering, but it will also provide your nanny with a feeling of trust and family acceptance. Examples of your personal property and home facilities may include home computer, television, exercise equipment, gym, swimming pool, family car, etc. Again, make it clear to your nanny so she is aware of what resources you are making available to her for her regular, personal use. Instill in your nanny the fact that the employer is the owner of the property and facilities, so the owner has the right to inspect and monitor usage, including Internet files; website activity; car mileage and maintenance. NOTE: This is key information to communicate in your Nanny Employee Handbook, as well.

Holiday Savings Account

You might consider offering the option of deducting specified funds, as warranted by your nanny, from each paycheck to be awarded at a later time in the year, such as around the holiday season when extra spending may be required. This is not a monetary benefit, but more of a thoughtful consideration on your behalf that your nanny might appreciate. This will not cost a cent on your behalf, but it might require some time, as you will be required to handle the finances as authorized by your nanny. A personalized benefit of this nature must be outlined and expressly communicated to your nanny so she is well aware of the option and how it will work to her benefit.