Both full-time and part-time nannies are eligible for Statutory Sick Pay (SSP) some of which can be offset against her NI liability. This can go a long way to making up a nanny’s salary while she’s ill so long as she isn’t earning very much. Your nanny can only become eligible for SSP after three consecutive days of absence from work. If your nanny is well-paid you may find that the SSP is relatively small so her illness will still cost you quite a lot – particularly if you have to bring in temporary help.
SSP is a flat rate so, when you take on a nanny, contact your local DSS office to find out the current rate.
The DSS or your local tax office will send you information on how to work out if you can claim back some SSP on the money you have paid your sick nanny and if so how to do it. It is rather complicated but basically you have to work out the total gross Class 1 national Insurance liability for that tax month in which she was ill. Multiply that figure by 13 per cent (round up to fractions of a penny) and then work out the total SSP payments in that month. If the amount of SSP paid is more than 13 per cent of the NIC’s due then you can claim back the difference. There, told you it was complicated!
Please don’t avoid the issue of sick pay. Nannies are human and can fall sick or be involved in accidents. It is important to be clear at the start what pay you will give her, how long you will pay for, and what you will do if the illness lasts a long time.
In all cases, as in the treatment of nannies and mother’s helps generally, it is best to be generous with sick pay. It reaps dividends in the long run; in some cases it means there isa long run!
If you need to know about your nanny’s maternity rights it is best to contact your local DSS (Contributions Agency) Office for a free, informative booklet produced by the Department of Employment, or contact the REC at 36-38 Mortimer Street, London W1N 7RB (020 7323 4300). Nannytax also have current information on Maternity rights. Contact them on 01273 626256.