The Nanny Annual Review: What It Is & Why It’s Important

The Nanny Annual Review: What It Is & Why It’s Important

For many, the beginning of a new year is an optimal time to evaluate all aspects of life and make any outstanding or necessary changes to embark on the year ahead!

Although your nanny’s employment might not be front and center in your mind when it comes to getting organized for a new year, January may be the perfect time to set up her annual review. Just like employees at traditional companies, nannies should always be given an annual review (some families even like to hold bi-annual reviews) to check in, discuss any matters of concern, and offer her a raise depending on her performance and your desire to continue a working relationship with her.

A comprehensive annual review for a nanny should always include a review of her current work agreement, her performance over the past year, areas of improvement, areas of expertise, a breakdown and reiteration of her current job duties, an update of job duties moving forward, and finally, the discussion of a raise (and making appropriate edits to your standing work agreement). This is the perfect time to make sure everyone is on the same page about the job that’s been done in order to make room and set the groundwork for improvements and changes to come.

It’s essential to remember that this review should be a two-way conversation, allowing your nanny to voice any concerns she’s had, ask questions about what the future holds, and to provide feedback from an employee’s perspective of what it’s like to work in your home, with your family. Similarly, as the employer, you should absolutely bring up any concerns you’ve been having. No one likes to criticize an employee – even if it’s done for completely constructive purposes – but letting your nanny know where you would like her to jump in more or pick up slack will ultimately strengthen your relationship!

An annual review is also the time to offer a raise and/or bonus to your nanny if you feel she has earned it (or if the city you live in requires you to increase pay annually to stay competitive)!

There are two primary factors that go into determining a raise. The first is a merit increase. This is an increase in your nanny’s pay based on her performance since your last review with her (or since she started the position). The merit increase is generally calculated as a percentage of base pay, and commonly ranges from 0% to 5%. If you don’t feel like you can give any merit increase, this is probably a good time to reevaluate if your nanny is right for your family. A 5% merit increase likely means that your nanny is surpassing your expectations regularly (i.e., you ask her to prepare a simple meal daily, and she prepares a feast, complete with packaged leftovers that are in the freezer), and is someone you could never, ever live without – she is a superstar!

The second piece of the ‘raise’ puzzle is the cost of living increase. This part of the raise is base on inflation and general increases in private childcare pay level in your area. The cost of living increase is also calculated as a percentage of base pay, and is usually somewhere between 2%-3%.

Finally, you should consider any other circumstances that may warrant a larger raise, such as a the addition of a new child, or a changing family dynamic that requires your nanny to go above and beyond the realm of ‘standard’ duties.

Once you’ve had your review and everyone is on the same page about changes you’ll be making moving forward, make sure you do not let an edited version of your work agreement fall by the wayside. If you have questions about the annual review process or would like assistance in renegotiating terms with your current nanny, we are always happy to help!