Friday, May 24, 2013

Good To Know: When Nanny Travels with their Employer Family

This article comes from our friends at Breedlove & Associates
 
HOW TO HANDLE A NANNY'S PAYROLL WHEN SHE TRAVELS WITH THE FAMILY
 
The summer months are right around the corner and many families are already planning their vacation schedule. For those who take their nanny along to watch the kids, this edition of The Legal Review addresses a common labor law mistake.
The Situation
The Kellogg family hired a nanny through a local placement agency to care for their three sons. The family needed someone who would be able to travel with them for at least two vacations during the summer. The agency was able to set the Kelloggs up with an ideal nanny who was eager to accept the position, in part because she had never been out of the state before and liked the idea of traveling to new places. The agency also recommended the family call Breedlove & Associates because traveling with a nanny can be tricky for families unfamiliar with labor law. The Kelloggs politely declined as Mr. Kellogg had worked in financial services his whole life and felt comfortable handling the nanny's payroll and taxes.
The Mistake
The first family vacation was a week-long trip to Disney World. The nanny was excited to go and assumed she would have some free time of her own. To her surprise, she worked much more than normal - instead of her normal 40 hour workweek, she worked 60 hours in Orlando. However, she didn't complain because most of her days were spent riding rides and playing games with the kids.
Upon returning from the trip, the nanny was exhausted. When she received her paycheck, she was surprised to find it was $300 less than her normal pay. When she read over her paystub, she noticed a $300 deduction for airfare. The nanny did not think this was correct, but before bringing it to Mr. Kellogg's attention, she contacted her placement agency who referred her to Breedlove & Associates.
The Law
When accompanying an employer on a trip - whether a vacation or a business trip - an employee must be compensated for all hours worked during the trip, including the time spent traveling to the destination. If the employee's working time exceeds 40 hours in a 7-day period, the employer must pay the employee for the overtime hours at the time-and-a-half rate. In addition to the regular and overtime pay, the employer is responsible for the employee's traveling expenses, including airfare and hotel accommodations. These expenses are covered by the employer because the employee would not have incurred these expenses on her own.
A traveling employee does not need to be compensated during her "free time," which is defined as time when she is not responsible for her charges and she has complete freedom to go and do whatever she pleases.
The Mess
A Breedlove & Associates consultant explained to the nanny that Mr. Kellogg had not handled her compensation for the trip correctly, but that this was a common mistake for new household employers. The consultant informed the nanny that she should have been paid for all hours worked and that Mr. Kellogg should not have deducted the expense of the flight from her paycheck.
The nanny presented this information to the Kelloggs and they were surprised and embarrassed to find out they had underpaid her. They apologized and explained to the nanny that it was never their intention to swindle her out of any additional money owed to her. Mr. Kellogg prided himself on paying the nanny "on the books," but admitted he was not an expert in employment law.
The Outcome
Mr. Kellogg contacted Breedlove & Associates on the advice of the nanny to figure out how much he needed to pay her. We helped him calculate the additional compensation owed to the nanny for the trip and explained more about household labor law so he would be prepared for the next family vacation. The Kelloggs made a catch-up payment to the nanny right away and ultimately decided to sign up for our service so they would never risk making a similar mistake again.
How the Whole Thing Could Have Been Avoided
If the Kelloggs had called Breedlove & Associates from the beginning - as their agency recommended - we could have helped save them the embarrassment of underpaying their nanny. Luckily the employment relationship between the Kelloggs and their nanny did not suffer from this incident, but their situation illustrates how easy it is to make a mistake with payroll or labor law.
888-BREEDLOVE (888-273-3356)




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