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Employment case highlights risks for nannies, educators, and families

paintingA teenage nanny has been awarded lost wages and compensation after the Employment Relations Authority determined she was underpaid and lost her job under difficult circumstances.

The 17 year old was employed by a Tauranga mother to look after two children through the Ministry of Education licensed ECE home-based agency Quality Kidz.

She had previously completed a certificate-level course in early childhood education and care at the Bay of Plenty Polytechnic.

She worked for the family for eight weeks between February and April 2014 during which time she was underpaid by about a third of the total amount she was due.

The mother first said the underpayment was due to a delay in Quality Kidz processing and forwarding a WINZ childcare subsidy, but then claimed that the nanny had not performed her duties adequately.

She also claimed that she was entitled to terminate the contract under the 90-day rule; however, there was no written employment agreement signed and therefore no rule applied.

During the investigation by the Employment Relations Authority, the mother asserted that the teenager had only been employed for casual babysitting, but evidence provided by the teenage nanny and Quality Kidz suggested otherwise.

No employment agreement was signed but Quality Kidz entered into correspondence and discussions with the mother, which suggested that the work would be on going, and paid at $14 per hour. It was on this basis that Quality Kidz applied for the WINZ subsidy.

Time-sheets collected by Quality Kidz were also provided as evidence of the hours worked.

The mother ended her relationship with Quality Kidz in April after a dispute over subsidy payments regarding a shortfall in the hours recorded on the time-sheet compared to the amount she was trying to claim.

At this point, the nanny stated she could no longer look after the children until the mother found a new ECE home-based service agency and could assure her that payment would be made after which her contract ended.

The Authority member reviewing the case determined that the nanny was entitled to the unpaid wages and $2000 compensation for the distress caused by the situation.

The case raises interesting implications for ECE services involved in providing home-based ECE.

From the report of the investigation, it appears that the nanny was simply provided with an employment agreement form and was at first left to ensure the agreement was signed herself.

An education team leader from Quality Kidz also tried to get the agreement signed, but despite this lack of a formal written agreement, the nanny was still allowed to begin working for the family.

Although the ECE home-based service collects Ministry of Education funding for each child placed with a nanny or home-educator and often also the fees from the parents and then administers, the nannies and educators on its books are in fact self-employed which could leave them with little support if things are difficult. 

It also means that nannies and educators may be left to negotiate extra details such as who pays for entry to playgroups and other outings directly with the parents.

For a teenage girl with no previous experience of being a nanny, it may be argued that a higher level of support should be put in place.

This self-employment also puts more stress on the parents as they effectively become the employers rather than having the buffer of an agency (the ECE service) to deal with issues as they arise, and are left open to complaints and disputes such as the one in this case.

The team leader did visit the home after the nanny had started work and had recommended that she leave the job shortly before the contract with the agency was terminated. However, it is unclear from the report how much support the nanny received from Quality Kidz while she was working and during the subsequent dispute.

The second issue surrounds the wage level agreed of just $14 per hour, which at the time would have been minimum wage. According to the Quality Kidz website, nannies and educators are able to set their own rate higher than the base rate, but it could be assumed that a teenager with little experience would be unlikely to think about charging higher rates.

It raises the question as to whether it is fair to expect someone to be in sole charge of children for such a low wage, and whether people willing to accept that rate have the necessary skills or experience to be in sole charge.

It should be noted that the Authority’s investigation and report did not comment on the conduct of Quality Kidz or on the practice which is common in the home-based ECE industry of requiring educators and nannies to work was independent contractors, as the dispute was between the nanny and the mother directly.

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