What Legal Nanny Pay Actually Requires

This guide is part of our Los Angeles Nanny Salary Guide for families.

Hiring a nanny is personal, but it is also employment. Compliance is not just a paperwork exercise. It protects the household, supports a professional working relationship, and helps a role feel more stable from the beginning.

Is a Nanny a Household Employee?

In many nanny arrangements, yes. The IRS explains that a household worker is generally an employee when the family controls not only what work is done, but how it is done. Nannies are specifically listed as examples of household workers in IRS Publication 926.

California Household Employer Registration

The California EDD says household employers must report when they employ one or more people and pay cash wages of $750 or more in a calendar quarter. Registration is due within 15 days after reaching that threshold. The EDD also explains that higher quarterly wage thresholds affect which payroll taxes must be withheld or paid. Families should review the current EDD household employer guidance or work with a household payroll provider.

Federal Household Payroll Basics

For 2026, IRS Publication 926 states that Social Security and Medicare taxes apply when a household worker is paid $3,000 or more in cash wages during the year. Publication 926 also explains W-2, Schedule H, and federal withholding basics for household employers.

Paid Sick Leave

California paid sick leave rules apply broadly to workers who meet the state’s eligibility requirements. The California Department of Industrial Relations states that, starting January 1, 2024, employers must provide at least 40 hours or five days of paid sick leave each year to most workers who qualify. Families should confirm how the rule applies to their nanny’s schedule and document it in the work agreement.

Overtime and Domestic Worker Rules

California’s Domestic Worker Bill of Rights extends overtime rights to certain personal attendants in private homes. The DIR summary states that covered personal attendants are entitled to overtime at 1.5 times the regular rate for hours over 9 in a day or over 45 in a week. Because nanny duties can vary, families should confirm the correct classification and overtime rules before finalizing an offer.

What to Put in the Work Agreement

• Pay rate, pay schedule, and overtime terms.
• Guaranteed hours, if offered.
• Paid sick leave, PTO, holidays, and vacation expectations.
• Driving, mileage reimbursement, and insurance expectations.
• Child-related duties and any household assistant duties.
• Confidentiality, notice period, and review schedule.

Why Compliance Helps You Hire

Experienced nannies notice when a family treats the role professionally. Legal pay, clear benefits, and a written agreement can make your offer more competitive, reduce misunderstandings, and help both sides start with trust.

Note: This article is educational and not legal, tax, or payroll advice. Families should confirm current requirements with a qualified professional.