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Nanny Annual Performance Reviews

Nannies, like any other employee, are entitled to regular, scheduled salary reviews and performance appraisals. Many families link the two, others strictly review salary on an annual basis and performance appraisals may be delivered more frequently. Regular review of performance and compensation sends the nanny the message that you view her as a professional, a valuable member of your family ‘team.’

Nanny Annual Wage Reviews

Typically an annual wage review (or raise) takes two important items into consideration: merit and cost of living.

A merit review recognizes demonstrated job performance within the year being reviewed. The merit increase will be performance based and typically will run from 0 – 3% of wages with zero being the nanny that does the bare minimum and 3% being the nanny who is an outstanding performer, often exceeding the family’s expectations. The outstanding performer may straighten out the pantry and toss out of date staples without being asked, or may come to work with a new coloring book and crayons to entertain a charge she knows is not feeling well. These ‘extras’ are not part of the nanny’s job description.

A cost of living increase is more in line with inflation – both cost of living and in some instances inflation in area nanny salaries. These can be referred to as COLA adjustments, a term commonly used in government.

Put together, these two components will become the annual salary adjustment. An example might be a very good – but not outstanding – nanny would be considered for a 2% merit increase and a 3% cost of living increase for a total increase of 5%. We typically see annual increases in the 3% – 6% range, exclusive of increases when new children arrive in the household.

Salary increases should be given every year, or more frequently if agreed to in the written work agreement.

Salary Review with Change of Duties

A nanny is entitled to and will expect a salary review, with an increase, whenever duties are added to her job. This could be additional hours, a new baby, or added housekeeping responsibilities. Failure to acknowledge the change in the job duties with an appropriate salary action will often permanently sabotage the relationship. The typical increase for a new baby is $2 – 4 per hour (10 – 20%), or no less than $75 per week.


Nanny Annual Performance Reviews

Typically, the performance evaluation for a nanny is on a schedule. Experts recommend a formal evaluation of the new nanny at one month, and again at three months. The next evaluation is due one year from nanny’s anniversary date, with annual nanny performance reviews thereafter. Well before the performance review date, begin to prepare for the evaluation. The preparation process ideally involves review of the Nanny Log, holding a preliminary meeting with the nanny, and nanny preparation of a self-evaluation. In two-parent households, we recommend that BOTH parents be involved in this process.

The following steps are suggested when conducting a nanny performance review:

  1. Before meeting with the nanny, review his or her job description and the Nanny Log for the review period. Review your observations, notes, and the previous performance evaluation. Locate and have ready any supporting information.
  2. Give the nanny advanced notice of the performance evaluation so that he or she has the chance to review and prepare.
Timely Feedback
Performance evaluation time should not be the point at which you begin to document performance discrepancies or deal with performance problems. Families and nannies need to practice good communication skills on a daily basis and provide timely, accurate and specific feedback on a real time basis, not waiting for the once a year performance appraisal process. Ordinarily, no problems should be raised with the nanny during the evaluation that you have not previously discussed with her during the review period.


  1. Hold a preliminary meeting with the nanny in private. The first meeting should take place before you write or deliver the formal performance evaluation. At this meeting, explain or review what will happen during the evaluation process and review the Performance Evaluation Form. Do this even if you have evaluated the nanny’s performance in the past. With the nanny, review his or her work agreement. Discuss which essential functions will be evaluated for the period.
  2. Conclude the meeting by scheduling the performance evaluation. Invite the nanny to complete the written self-evaluation prior to the next meeting. A self-evaluation may be used as the basis of discussion during the formal evaluation process. The self-evaluation is a valuable tool through which to discover the nanny’s perspective on her performance, as well as to identify interests related to goals and career development.
  3. Deliver the annual performance review according to your schedule in private – the kids absolutely should not be present for this conversation, whether the appraisal is good or bad. This quiet, uninterrupted setting allows you and your nanny to focus completely on the conversation at hand.
  4. Prepare and deliver your core message. This should be no more than two or three areas of strength or accomplishments, two or three areas to work on for improvement, including some brainstorming on how to get there, and one or two clear goals for the next period. Goals can be a simple as potty training, to as difficult as helping Susie become independent doing her homework.
  5. Remember, feedback matters. The only way for people to get better at what they do is for the people they work for to provide candid, timely performance evaluations. You should provide your nanny with an opportunity to provideyou candid feedback too. If you are chronically late and this aggravates the nanny, be receptive to her concerns.


As described above, this really is a two step process. The annual wage review is a transaction that determines how much the family will pay the nanny. The annual performance review is a valuable conversation and exchange of feedback on how the relationship is going and planning for the future direction the relationship will take.

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