Your nanny may feel like a member of your family, but technically, they’re a household employee who, at some point, deserves a raise. But what’s the protocol around these pay increases? Is a nanny raise in order every year? And if so, how much?
“Like in most workplaces, at the end of each year of service, it is customary for nannies to have an annual review and contract renegotiation,” explains Michelle LaRowe, lead educator at Global Nanny Training. “In addition to a cost of living increase, a performance-based merit increase should also be considered. While the cost of living increase can vary year to year, a good rule of thumb is a 2-4% cost of living increase, plus a merit raise of 3-7%, leaving most nannies with a 5-10% annual increase.”
Wondering if and when you should give your nanny a raise (and how much)? Here, nanny pros and parents offer insight.
Reasons a nanny raise is due
1. A year has passed
In most situations, a nanny raise every year is standard. “Many employers choose to give a raise on an annual basis, as part of a performance review process,” says Kristen Szapka, founder and owner of A Nanny Match nanny agency in New York City and Boston. Szapka also notes that “reviewing compensation at least once a year can help ensure that both parties feel the arrangement is fair and equitable.”
“Reviewing compensation at least once a year can help ensure that both parties feel the arrangement is fair and equitable.”
— Kristen Szapka, founder and owner of A Nanny Match
During a performance review, Szapka says to consider “if the nanny has been doing an exceptional job and has gone above and beyond, a raise is a great way to acknowledge this.
Agreeing with LaRowe, Szapka notes that the average nanny raise per year should be “5-10% of their hourly pay,” which is based on both merit (performance), as well as the cost-of-living adjustment (COLA). The former, Szapka says, acknowledges if a nanny has gone “above and beyond,” and the latter keeps up with inflation and “helps the nanny maintain the same standard of living.”
It’s also worth noting that your location comes into play here, as well. Says Szapka: “In New York City, the cost of living has increased significantly over the past couple of years, and we’ve seen the average hourly wage increase by about $5 or more since 2020-2021.”
Lora Brawley, 30-year nanny veteran and consultant and trainer at Nanny Care Hub in Federal Way, Washington, concurs with Szapka, noting that, in the last year, she’s seen an increase in standard COLA raises, due to the economy.
“Instead of a 2-4% COLA raise, I’m seeing 3-6%,” she says, adding that most nannies get a COLA raise and a performance raise at the same time, so it feels higher overall. “The nannies who are hitting their ceiling with performance raises are still getting a COLA raise,” she notes.
2. You add more duties
“When a nanny’s job description changes substantially, it’s standard for the nanny to receive a raise that reflects their new, expanded job description,” Brawley says. “There is no standard amount for this type of raise,” she adds. “The amount depends on how much the employers and the nanny feel the task is worth.”
According to Brawley and Szapka, new duties may include:
- Adding a new puppy to the family.
- Cooking.
- Additional chores.
- Traveling.
- Helping with homework.
- Driving more.
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3. You had a baby
“When a family adds another child — a new infant or adopted child — it’s standard for the nanny to receive a baby raise,” says Brawley, who explains that the pay increase can range from an extra “$2-$5 an hour,” depending on how much their duties will increase.
“When a family adds another child — a new infant or adopted child — it’s standard for the nanny to receive a baby raise.”
— Lora Brawley, 30-year nanny veteran and consultant and trainer at Nanny Care Hub
A raise might also be in order if there are shifts in child custody agreements. Brawley notes that when a blended family has an extra child living in the household for the summer, “the nanny generally receives a raise for the summer months only.”
4. Your nanny received new education or certifications
If your nanny has undergone professional development, a raise may be in order, Szapka says.
“If the nanny has pursued additional training or certifications that add value to the job, such as child development courses or first aid, a raise is a good way to recognize these efforts,” she says.
5. You’re underpaying
“If the nanny’s current pay is below the going rate for nannies in your area, a raise might be necessary to ensure you’re offering competitive compensation,” Szapka says, who adds: “The best way to retain your nanny is to offer a raise if you’re satisfied with their work and want to make sure they will stay with you for a long time. This can be especially important if there’s a high demand for nannies in your area.”
“The best way to retain your nanny is to offer a raise if you’re satisfied with their work and want to make sure they will stay with you for a long time.”
— Kristen Szapka, founder and owner of A Nanny Match
Jen T., a mom of two in Westfield, New Jersey, didn’t realize she was underpaying her nanny until she found out what other families in the area were paying.
“I learned we were paying about $3 an hour less than other families in our area with the same amount of kids,” she says. “I felt terrible and adjusted her rate right away. We’re lucky we didn’t lose her.”
To find out the going rates of nannies in your area, check out our Cost of Care Calculator.
6. They ask for one
If your nanny asks for a raise before the one-year mark or without an increase in duties, there’s a good chance you’ve been underpaying them, says Brawley, or their salary doesn’t match the going rates in your area.
“In these cases, the nanny has generally asked for less than they need or less than they feel they deserve during the negotiations,” she says. “This happens a lot when they take a job, get into the nanny groups and hear from other nannies.”
Another potential reason a nanny may ask for a raise before you feel they’re due is their personal circumstances, Szapka says.
“Has there been a significant change in their personal circumstances that might necessitate a raise, such as a sudden increase in rent or unexpected medical expenses?” she notes. “While you are not obligated to accommodate these changes, it might be worth considering, especially if you value their work and want to maintain a good relationship.”
7. Your nanny is the best
While there are a number of concrete reasons for a nanny raise, perhaps the most important one is that you love them and they deserve one — and of course, the longer your nanny is with you, the deeper your appreciation for them.
Says Szapka: “A nanny becomes more valuable as they gain a deeper understanding of the family’s routines and expectations and form stronger bonds with the children.”
What if I can’t afford to give a raise?
If you truly can’t afford a raise due to your financial situation, Szapka says to “explain the reasons why and when they might expect a review of their salary.”
Also, make sure they feel seen and valued, even if you can’t meet their request right now. “Think of other benefits or perks that may make their job easier or more fulfilling, such as flexible hours or additional paid time off,” she says.
For ideas, check out these: nanny job benefits families should consider offering.
Overall, Brawley adds, make sure you’re a great employer.