What are fair wages for a nanny in Switzerland?

Great Blog post by our Nanny / Household Staff Payroll Partner quitt.ch

Found the right nanny for you in home childcare perfectly matching your requirements and your children needs? Well done! Time to employ and insure your new nanny correctly. As part of this employing process most parents see themselves faced with the question of what a fair wage for the nanny would be. These are our recommendations!

Nanny wage recommendations

Our wage recommendations for nannies are indicated as gross wages. It is import to be aware of the fact that the gross wage is the total remuneration of work carried out before the social security contributions and tax. All of our wage recommendations are based on a full time position with an employment rate of 100% and a working week of 42 hours.

At least CHF 3’450 to 3’800 without vocational training
At least CHF 3’800 to 4’800 with proven professional skills and experience
These values are based on the one hand on the handbook “Alternatives to the day-care centres” of the city of Zurich (available in German only) and on the other hand on the graph below showing the distribution of monthly gross wages of nannies employed via quitt.ch. By paying close attention to the graph you will see that the vast majority of the gross wages of nannys employed via quitt.ch are part of the wage gap indicated above.

verteilungbruttoloehne_08092016

Determing wages for a nanny: What else to consider

Many parents in Switzerland decide to hire nannies since they can look after the children “around the clock” outside the usual opening times of day care centers. Many nannies are so called live-in-nannys living with family of the children to be supervised. Lodging and boarding are provided by the family.

These out-of pocket expenses are called wages in kind which are part of the total wages for nanny, and therefore have to be accounted for accordingly. In Switzerland, the total amount of wages in kind is CHF 990. So for example if the monthly gross salary of a nanny is CHF 2800, the wages of kind of CHF 990 will be added to gross salary. So the entire monthly gross salary of the nanny will be CHF 3790. The AHV and social insurance contributions as well as the taxes will be deducted from the total amount of CHF 3790.

By using our free wage calculator you can calculate the monthly wages for your nanny including the automatic deduction of all social contributions and the cost for the compulsory accident insurance.

Nannies and occupational plans

Most nannies are employed on a monthly basis due to the high number of working hours per week. As soon as their monthly wages exceed CHF 1762.50 per month or CHF 21’150.00 per year they have to be registered with a pension fund (Second Pillar of the Swiss occupation plans).

By the way, nannies directly accommodated by families in Switzerland are generally preferred over nannies having to provide for their own accommodation and boarding!

quitt.ch offers all services needed when it comes to employing, registering and insuring your nanny in accordance with all legal requirements. quitt.ch handles all administrative employer obligations, offers a favorable pension fund solution and provides all important documents such as the monthly pay statements and a professional employment contract. Further information about the employment of a nanny can be found here.

Do I have to pay the full wages when my nanny / cleaner is unable to work due to long-term illness?

Post from our Partner Quitt – for all your nanny / household staff payroll needs

It may very well happen that your domestic helper or nanny is unfit to work for a longer period of time due to a severe illness or pregnancy. In this particular case, must all wages be paid during the entire leave of absence?

Suddenly, there was pain. Off to the hospital a few days later. Diagnosis? Acute appendicitis. The surgery as well as the recovery go smoothly. The only catch? Unfit to work for a longer period of time.

Planed for a long time, finally worked out. The desired offspring is own its way. Anticipation is huge, the kid’s room is fully furnished and equipped. Thus, towards the end of the pregnancy, the doctor orders a strict bed rest. Consequence? Unfit to work for a longer period of time?

Incapacity for work is an issue that addresses employers as well as employees. It might be advisable to both parties to be secured against the above-mentioned cases. In case of prolonged absences due to illness of the employee, according to law the employer is required to pay full wages despite failing labor services (an overview of the different wage scales in Switzerland can be found here). Once the legal obligation of continued sick pay is elapsed, the employee will not be paid anymore. Certainly not an ideal scenario for both parties involved. The solution? A sick pay insurance.

Advantages of a sick pay insurance (KTG) for the employer.

A sick pay insurance has the advantage that the employer is no longer bound to the continued payment of wages required by law. In addition, during the waiting period of 14 days only 80% of the wages need to be paid. Why? The employer bears the risk of continued payment of wages to the insurance company.

The following sample calculation shows the advantage of a sick pay insurance for the employer.

sick-pay-insurance-quitt.ch_

Advantages of a sick pay insurance (KTG) for the employee.

For employees, in our case cleaners, domestic helpers, nannies, caregivers or babysitters, the advantage is very clear. Financial security is ensured even once the employer is no longer bound to the continued payment of wages required by law. In case of illness or pregnancy, 80% of total wages will be paid continuously. Therefore, a secure income will be provided until the employer is able to work again, to the maximum of 730 days.

Shared insurance premium

The premium of the sick pay insurance amounts to a total of 1.52 % of the gross wage. The total amount of the insurance premium is equally shared between the employer as well as the employee, amounting to 0.76 % for each. Even though a sick pay insurance is not compulsory in Switzerland, we highly recommend it.

The wish, to take out a sick pay insurance, can be expressed by both the employer as well as the employee.

You can take out the sick pay insurance by clicking here. Further information about our different kind of insurance solutions can be found here.

Do you have any questions regarding the sick pay insurance? Do not hesitate to contact Quitt for support in your domestic staff payroll needs.

Do I have to register our Babysitter for AHV?

Below blog post by our Partner Quitt (Quitt website) who take care of all your nanny / household staff

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Most of us will have carried out small jobs for relatives, friends and neighbors in return for a minor payment at least once in life – the so-called pocket money jobs such as babysitting. Factually in doing so, a new working relationship is established. Will you have to register the employment with the AHV in accordance to Swiss law?

In most cases, pocket money jobs are considered to be a great way of generating additional income for students and teenagers. These small jobs help students to finance their university fees and enable teenagers to gain valuable work experience. Next to the most popular pocket money job in private households – babysitting – small services such as easy office work, computer tutoring, cleaning windows, gardening work and helping someone move houses are also considered to be pocket money jobs. However, many people are unaware of the fact that as soon as the babysitter is paid, he/she will become an employee and the parents who hire the babysitter will become employer.

New regulation for the AHV contribution obligation

By law all wages earned during any employment in private households must be declared and settled with the compensation offices (AHV). Does this also apply to babysitting? Yes and no!

The Swiss parliament has passed a new law (effective from 1st of January 2015) stating that adolescents (up to the age of 25) carrying out small jobs in private households and earning less than 750 CHF a year are exempt of all AHV contribution obligations. In other words, babysitter below the age of 25 making less than 750 CHF a year do not need to be registered with the compensation office by parents. Before the new law was passed, the age limit was 17.

Obviously 750 CHF per year is not necessarily all that much. Let’s say a babysitter is earning 15 CHF an hour, after only 50 hours of work (alternatively after one hour of work a week) the limit of 750 CHF has already been reached. As soon as this limit of 750 CHF a year is exceeded, babysitters that are not registered and insured correctly are due to legal issues. In such cases it is highly recommended to make sure that the babysitter is employed correctly.

Accident insurance for pocket money jobs

As part of the new regulation, no premium for the accident insurance for babysitting and other pocket money jobs must be paid as long as the employees are below the age of 25 and earning less than 750 CHF a year. In case of an accident during work in private households, the compensatory fund (Ersatzkasse) will cover the costs. Nevertheless, the Ersatzkasse might reclaim the insurance contributions to a maximum of 5 years, meaning that the employer must cover all costs incurred by the accident. In comparison to that, taking out an accident insurance for a babysitting is not only saver but also much cheaper.

Click here for the cheapest accident insurance for babysitters in Switzerland Quitt

Average Salaries for Nannies in Switzerland

beautiful-nanny

Full-time live –in and live-out nanny salaries range between 3500CHF – 5000CHF per month gross on average depending on experience and qualifications and number of hours worked per month (full time standard hours are 43 hours a week in Zurich for nannies – each canton varies on standard hours too). For live-in nannies, an amount of 990CHF can be deducted from their salaries for food and accommodation. Hourly rates for nannies range between 20CHF-35CHF per hour gross on average, once again depending on experience and qualifications.

On top of the gross salary, the employer has to add his/ her contributions to AHV / AVS as per below, Accident Insurance and BVG (if salary above annual threshold of 21 150CHF). The employer is also responsible for deducting the employee contributions from the monthly gross salary and paying them to the appropriate institutions.

Below is a table outlining a gross monthly salary of 4000CHF and the relevant social deductions for the AHV / AVS – this is an example based on Zurich AHV office rates. Each canton varies slightly but this will give you a general idea.

Social Contributions % Basis Amount Employee Amount Employer Total
AVS /AHV/IV/EO 10.30 4’000 206.00 206.00 412.00
Family Fund 1.10 4’000. 44.00 44.00
Unemployment Insurance 2.20 4’000 44.00 44.00 88.00
Admin Costs AHV 5.00 412.00 20.60 20.60
Amount in CHF     250.00 314.60  
Total social deductions (to be billed to employer) 564.60

Additional, the BVG amount is dependent on age of the person and salary and is paid half by employer and half by employee. The employer is billed for total amount.

The occupational accident insurance is paid for by the employer and the non-occupational insurance is usually deducted from the employee’s salary however the employer has to organize both insurance policies.

There is a minimum salary range for domestic staff including nannies in Switzerland based on experience and qualifications – please see attachment (some cantons have slight variations)

For further details on salaries for nannies and contributions etc, see blog posts under Category “Switzerland Nanny Salaries etc”

Disclaimer – Rockmybaby ® is not an employment lawyer nor specialises in employment law and strongly suggests seeking advice from a lawyer when drawing up an employment contract. This post is intended for information purposes only and Rockmybaby® Switzerland cannot be held liable for any incorrect information. 

What accident insurances do I need for my nanny?

Accident insurance

When employing a nanny, families need to ensure they have the relevant accident insurances  –

  • for nannies who work less than 8 works per week: the family only need to ensure they have Occupational Accident insurance  – this is payable by the employer.
  • for nannies working eight hours or more per week: the family also need to ensure they take out an additional accident insurance called Non-Occupational Accident insurance – this monthly premium you may deduct from the nanny’s salary.

For more information on these accident insurances, please contact your insurance provider.

What is the BVG / LPP pension plan that you need for your nanny?

BVG / LPP (Second Pillar Pension)

This is a Occupational Benefits plan and is compulsory if your nanny earns more than         21 060CHF per annum or 1755CHF per month – the employer will be responsible for taking out a second pillar pension for the employee. This premium is paid in equal parts monthly by both employer and employee.  Fo more information, please take a look at this link with relevant information – Meaning and Objectives of Occupational Pensions Funds

What social contributions does a family have to pay for a nanny?

Social insurance contributions

Familes and Nannies have to contribute to AHV / AVS if the person is older than 17 years old. Half of the contributions are paid by the employer and the other half by the employee (deducted from their salary). You need to register your nanny with the AHV / AVS in your canton of residence after which you will receive quarterly invoices for the social contributions. The Invalidity Insurance, Family Insurances and the Unemployment Insurance also fall part of the social contributions and are all submitted through the AHV / AVS. Should the nanny earn less than 21 060CHF per annum, the income tax can also be submitted through the AHV.