A nanny may become a trusted and deeply valued part of a family, but the relationship is still an employment relationship.

That means both sides need clarity about:

• What work will be performed
• When the nanny will work
• How the nanny will be paid
• How overtime is handled
• Which benefits apply
• How expenses are reimbursed
• What happens when plans change
• How the relationship can end

A verbal agreement may feel warm and flexible at first. Unfortunately, people often remember conversations differently, especially after months of schedule changes, added duties, school breaks, family travel, new children, or compensation discussions.

A written nanny contract—often called a nanny work agreement—creates a shared reference point.

It does not need to be hostile or overly legalistic. A good agreement simply puts the family’s actual expectations and the nanny’s actual employment terms in one place.

A Nanny Contract Is an Employment Agreement

A nanny contract should be consistent with:

• Federal wage and hour law
• State and local employment law
• Household payroll rules
• Domestic worker protections
• Workers’ compensation requirements
• Paid leave rules
• Tax obligations
• Privacy and recording laws
• Motor vehicle and insurance requirements

The agreement cannot lawfully waive protections that employees are legally entitled to receive.

For example, a contract should not state that:

• All overtime is included in salary without lawful calculation
• The nanny gives up minimum wage
• Earned wages can be withheld as punishment
• The nanny is an independent contractor merely because both sides prefer that label
• The family may secretly record audio where prohibited
• The nanny has no right to report abuse or unsafe conditions

Reason 1: It Clearly Defines the Job

The agreement should identify:

• Employer name or names
• Nanny’s legal name
• Children covered
• Work location
• Start date
• Job title
• Regular duties
• Occasional duties
• Excluded duties

A vague phrase such as “light housekeeping” can create conflict.

The family may mean:

• Washing children’s dishes
• Cleaning bottles
• Tidying toys
• Doing children’s laundry

The nanny may reasonably interpret it the same way.

Months later, the family may begin expecting:

• Adult laundry
• Family meal preparation
• Deep cleaning
• Grocery shopping
• Pet care
• Vendor supervision

The agreement should list recurring duties specifically.

Child-related duties may include

• Preparing children’s meals
• Washing bottles and children’s dishes
• Children’s laundry
• Tidying play areas
• Organizing children’s belongings
• School transportation
• Homework help
• Planning activities
• Maintaining child-related supplies

Broader duties may include

• Family laundry
• Family cooking
• Grocery shopping
• Household errands
• Pet care
• Calendar management
• Vendor coordination
• Household organization

Broader roles are legitimate when discussed and compensated.

The agreement should also explain that child safety and direct supervision take priority over secondary household tasks.

Reason 2: It Prevents Job Creep

Job creep occurs when the nanny’s responsibilities gradually expand beyond the original role without a formal discussion or pay adjustment.

Examples include:

• One child becoming two
• Occasional family laundry becoming weekly laundry
• A rare errand becoming daily household management
• One late evening becoming regular overtime
• A simple playdate becoming care for another family
• Light pet care becoming full pet responsibility
• Occasional travel becoming frequent travel

A contract creates a process for change.

For example:

Any regular change in duties, schedule, number of children, travel, or household responsibilities must be discussed in advance and added to this agreement in writing.

The parties can then review:

• Time required
• Safety
• Priorities
• Schedule
• Compensation
• Effective date

Reason 3: It Establishes the Schedule

The agreement should identify:

• Workdays
• Start time
• End time
• Weekly hours
• Earliest expected arrival
• Latest expected departure
• Breaks
• On-call expectations
• Weekend expectations
• School-break schedule
• Summer schedule
• Notice for changes

It should also address:

• Parent arriving late
• Nanny arriving late
• Emergency schedule changes
• Weather closures
• Family travel
• Children staying home from school
• Parent working from home

A clear schedule helps prevent the assumption that the nanny is available whenever needed.

Guaranteed Hours

Guaranteed hours generally mean the nanny receives regular pay for the agreed schedule when the nanny remains ready and available but the family chooses not to use the care.

Examples may include:

• Family vacation
• Grandparent visit
• Parent taking the day off
• Family leaving early
• Child attending another program

Guaranteed hours provide stable income and support retention.

They should not be used to “bank” unused hours and move them into another workweek in a way that avoids overtime.

Reason 4: It Explains Pay and Overtime

The agreement should state:

• Regular hourly rate
• Weekly salary equivalent, if used
• Overtime rate
• Payday
• Method of payment
• Payroll deductions
• Timekeeping method
• Bonus terms
• Raise-review schedule

Nannies are generally household employees when the family controls what work is done and how it is performed.

The IRS Household Employer’s Tax Guide explains federal tax responsibilities for household employees.

Covered nonexempt domestic workers generally must receive:

• At least the applicable minimum wage
• Overtime after 40 hours in a workweek

State or local law may provide stronger protections.

A fixed weekly salary does not automatically eliminate overtime.

Example structure

The agreement might state:

Regular hours are Monday through Friday from 8:00 a.m. to 5:00 p.m. The regular hourly rate is $__. Hours over 40 in a workweek will be paid at the legally required overtime rate.

The family should track actual hours worked.

Time may include:

• Required early arrival
• Staying late
• Work messages that require action
• Travel work
• Overnight interruptions
• Meal periods when the nanny remains responsible
• Off-site errands
• Required preparation

Reason 5: It Documents Payroll and Tax Treatment

The agreement should state that the nanny will be treated as an employee when required by law.

It may address:

• Form W-4
• Form I-9
• Social Security and Medicare taxes
• Federal unemployment tax
• State unemployment
• State withholding
• Payroll service
• Year-end Form W-2
• Workers’ compensation
• Paid leave contributions where applicable

Avoid promising “cash under the table.”

Off-the-books employment can create problems involving:

• Tax liability
• Unemployment benefits
• Workers’ compensation
• Wage claims
• Mortgage or rental verification
• Social Security earnings
• Professional references

A written agreement supports accurate payroll records.

Reason 6: It Defines Benefits and Paid Time Off

The agreement should explain:

• Paid holidays
• Vacation
• Sick leave
• Personal days
• Family vacation
• Bereavement
• Weather days
• Health stipend
• Retirement contribution
• Professional development
• Paid training

Important details include:

• Number of days or hours
• Accrual
• Eligibility
• Notice
• Carryover
• Payout at separation
• Coordination with state or local law
• Whether the family chooses vacation dates
• What happens when the family travels without the nanny

Do not use one vague term such as “two weeks off.”

Clarify whether those weeks are:

• Nanny-selected
• Family-selected
• Paid
• Unpaid
• Guaranteed-hours periods
• Subject to notice

Sick Leave

A sick-leave policy should address:

• Paid or unpaid status
• Notice
• Documentation when lawful
• Contagious illness
• Children who are ill
• Emergency backup
• Local paid-sick-leave requirements

The nanny should not be pressured to work with a serious or contagious illness because the family lacks backup care.

Reason 7: It Creates Clear Reimbursement Rules

Nannies should not routinely finance the family’s child care expenses.

The contract should explain:

• Petty cash
• Reimbursement
• Receipt requirements
• Approval limits
• Payment timing
• Credit card use
• Mileage
• Parking
• Tolls
• Admission fees
• Meals during outings
• Travel expenses

Mileage

When the nanny uses a personal vehicle for work, the agreement should address:

• Mileage reimbursement rate
• Which trips qualify
• Documentation
• Parking
• Tolls
• Insurance
• Maintenance
• Personal commuting

The IRS publishes an optional standard mileage rate that changes over time.

The agreement can reference the current IRS rate or another lawful arrangement.

Family vehicle

When the nanny drives a family vehicle, address:

• Authorized drivers
• Insurance
• Fuel
• Maintenance
• Parking
• Tickets
• Accidents
• Child restraints
• Personal use
• Vehicle cleanliness

A reimbursement clause prevents conflict and protects the nanny from carrying ongoing business expenses.

Reason 8: It Covers Driving, Travel, and Overnight Care

These duties create risks and workload that should never be left vague.

Driving terms

Include:

• Valid driver’s license
• Motor vehicle check
• Insurance
• Vehicle choice
• Car seats
• School pickup
• Emergency transportation
• Phone use
• Accident reporting
• Authorized destinations

Travel terms

Include:

• Dates
• Destination
• Work schedule
• Travel time
• Overtime
• Meals
• Lodging
• Private sleeping space
• Passport or visa expenses
• Days off
• Expenses
• Child care expectations
• Cancellation

A family vacation is not automatically a vacation for the nanny.

Overnight care

Include:

• Awake hours
• Sleep period
• Night wakings
• Private sleeping space
• Flat overnight fee if lawful
• Hourly compensation
• Overtime
• Morning duties
• Maximum consecutive hours

State and federal wage rules may affect how overnight time is paid.

Reason 9: It Clarifies Safety, Discipline, and Emergency Procedures

The agreement should establish expectations involving:

• Positive guidance
• Prohibited discipline
• Medication
• Allergies
• Emergency contacts
• Medical authorization
• CPR and first aid
• Fire
• Severe weather
• Missing child
• Water safety
• Firearms
• Pets
• Pools
• Internet and social media
• Child release
• Incident reports

Discipline

The contract should prohibit:

• Hitting
• Shaking
• Humiliation
• Threats
• Withholding food
• Unsafe restraint
• Forced affection
• Locked isolation
• Punishment inconsistent with family rules or law

It should explain the family’s preferred guidance approach.

Medical emergencies

The nanny should have:

• Parent contact information
• Backup contacts
• Pediatrician
• Insurance information
• Allergies
• Medication instructions
• Consent for emergency care
• Address of the home
• Nearest hospital
• Emergency transportation plan

A contract should not be the only emergency document, but it can confirm responsibilities.

Reason 10: It Explains Reviews, Changes, and Termination

A work agreement should not remain untouched for years.

Review it:

• Annually
• When a child is born
• When school schedules change
• When duties expand
• When hours change
• When travel becomes regular
• When compensation changes
• When the nanny moves in or out
• When family circumstances change

Performance reviews

The agreement may set:

• Review date
• Evaluation process
• Raise discussion
• Goal setting
• Training plan
• Feedback method

A review does not guarantee a raise unless the contract says it does.

Contract amendments

Changes should be:

• Discussed
• Written
• Dated
• Signed
• Added to both copies

Text messages can document a change, but a formal amendment is clearer for major terms.

Termination

The agreement should address:

• Notice
• Immediate termination for serious misconduct
• Severance
• Final wages
• Accrued leave
• Return of keys
• Vehicle
• Credit cards
• Documents
• Confidential information
• Reference
• Transition for children

Examples of serious misconduct may include:

• Abuse
• Theft
• Intoxication at work
• Deliberate child endangerment
• Major dishonesty
• Unauthorized visitors
• Serious confidentiality breach

The agreement should not permit unlawful withholding of earned wages.

At-Will Employment

Many U.S. employment relationships are at will, meaning either party may end the employment relationship subject to applicable law.

A contract can unintentionally change at-will status if it promises employment for a definite period or limits termination.

Families should use qualified legal guidance when drafting binding termination language.

Severance

Severance is not always legally required, but it may be agreed upon.

Possible terms include:

• One or more weeks of pay
• Eligibility only after a certain period
• No severance for specified serious misconduct
• Additional pay when the family ends care without notice
• Transition assistance

Avoid making promises the family cannot afford.

Notice

A notice clause may encourage a smoother transition.

It should also explain that:

• Safety concerns may require immediate separation
• Final wage laws still apply
• The nanny may resign without working notice
• The family may choose to pay in lieu of notice
• State law may affect deductions or final payment timing

Confidentiality and Privacy

A nanny may learn sensitive information involving:

• Family finances
• Medical conditions
• Relationships
• Home security
• Children
• Travel
• Work schedules

The contract may prohibit unauthorized disclosure.

It should not prevent lawful reporting of:

• Abuse
• Neglect
• Wage violations
• Discrimination
• Crime
• Safety hazards
• Government investigations

Cameras and Recording

The family should disclose:

• Cameras
• Locations
• Audio capability
• Access
• Storage
• Purpose
• Monitoring expectations

Never place cameras in private areas such as:

• Bathroom
• Changing space
• Nanny’s private bedroom
• Other locations protected by law

Audio-recording consent laws vary by state.

A transparent camera policy protects trust.

Social Media and Photographs

The agreement should address:

• Photos of children
• Posting
• Texting images
• Cloud storage
• Parent permission
• Location tagging
• Child names
• School information
• Deleting images after employment

The family should also agree not to post the nanny’s image or personal information without permission.

Visitors and Personal Conduct

Policies may address:

• Nanny’s visitors
• Family visitors
• Contractors
• Smoking
• Alcohol
• Drugs
• Firearms
• Personal phone use
• Television
• Internet
• Dating partners
• Sleeping
• Household boundaries

Rules should be reasonable, specific, and connected to safety or employment.

Trial Period

A trial period can help both sides assess fit.

The agreement should explain:

• Length
• Pay
• Duties
• Schedule
• Notice
• Whether benefits begin immediately
• Whether the period changes at-will status
• Whether payroll taxes are still handled normally

A “trial” is still work and must be paid.

Live-In Nanny Terms

A live-in agreement should add:

• Private room
• Bathroom
• Guests
• Food
• Utilities
• Privacy
• Off-duty time
• House rules
• Wage deductions
• Moving-out period
• Property
• Overnight expectations

Living in the home does not mean the nanny is working 24 hours a day.

The Department of Labor has specific rules for qualifying live-in domestic employees.

Nanny Share Terms

A nanny share may need separate or coordinated agreements among:

• Family A
• Family B
• Nanny

Address:

• Employer responsibilities
• Payroll
• Schedule
• Work location
• Rate
• Overtime
• Guaranteed hours
• Illness
• Vacation
• Supplies
• Transportation
• One family leaving
• Disagreements

Each family may be a household employer.

Do not rely on one family to handle every legal obligation without confirming the arrangement.

New Baby or Additional Child

The agreement should require a review before a new child is added.

Discuss:

• Effective date
• Infant duties
• Schedule
• Safe sleep
• Feeding
• Workload
• Compensation
• Parent leave
• Older child routines
• Extra support

Do not assume a new baby is automatically covered at the same rate.

School-Age Changes

When children begin school, duties may shift to:

• Morning care
• School pickup
• Homework
• Activities
• Laundry
• Meal preparation
• Household management
• Summer care

Reduced daytime child care does not automatically mean the nanny has unlimited capacity for housekeeping.

Update the role honestly.

What a Strong Nanny Contract Includes

A complete agreement may include:

• Parties
• Children
• Start date
• Work location
• Schedule
• Guaranteed hours
• Duties
• Excluded duties
• Pay
• Overtime
• Payroll
• Timekeeping
• Benefits
• Paid leave
• Holidays
• Reimbursement
• Mileage
• Driving
• Travel
• Overnight care
• Discipline
• Emergencies
• Medical authorization
• Cameras
• Confidentiality
• Social media
• Visitors
• Performance reviews
• Amendments
• Notice
• Termination
• Severance
• Final wages
• Signatures

Mistakes to Avoid

Avoid contracts that:

• Call the nanny an independent contractor without legal basis
• Omit overtime
• Use vague duties
• Allow unlimited schedule changes
• Ignore guaranteed hours
• Provide no reimbursement method
• Require off-the-clock work
• Hide cameras
• Waive mandatory reporting
• Withhold earned wages
• Contradict state leave law
• Permit unsafe discipline
• Include unenforceable penalties
• Never get updated

The Contract Should Match Reality

A written agreement is useful only when both sides follow it.

If the contract says:

• Friday is payday
• Hours end at 5:00
• Adult laundry is excluded
• Mileage is reimbursed
• Vacation is paid
• Overtime is recorded

then daily practice should match those terms.

Repeatedly ignoring the agreement damages trust.

The solution is not to keep the outdated contract in a drawer. Update it.

Frequently Asked Questions

Related Resources

• What Is Job Creep, and How Does It Affect Nanny Turnover Rates?
• What You Need to Know About Background Checks
• Forms Childcare Providers Should Keep On File
• What Kinds of Certifications Should a Childcare Provider Have?
• Is Your Childcare Provider Safe? 3 Signs Your Kids are in Danger
• Questions to Ask When Interviewing a Daycare Provider
• How to Choose Child Care: A Parent’s Complete Guide

Sources

• IRS Publication 926: Household Employer’s Tax Guide
• IRS: About Publication 926
• IRS Topic 756: Employment Taxes for Household Employees
• IRS: Schedule H for Household Employment Taxes
• U.S. Department of Labor: Domestic Service Workers
• U.S. Department of Labor: Hours Worked for Domestic Service Employees
• U.S. Department of Labor: Live-In Domestic Service Workers
• U.S. Department of Labor: Wages and the Fair Labor Standards Act
• IRS: Standard Mileage Rates

ChildCareCenter.us is an independent directory and educational resource. Nanny contracts, wages, overtime, payroll, taxes, guaranteed hours, paid leave, privacy, recording, workers’ compensation, domestic-worker protections, and termination rules vary by jurisdiction and situation and may change. This article is not legal, tax, payroll, employment, or financial advice. Use current government guidance and consult qualified professionals.