Hiring a Nanny in Denver: Understanding Nanny Laws and Starting Payroll
As a parent who has gone through the nanny hiring process myself, I understand how overwhelming it can be to navigate all the rules, legal requirements, and paperwork. That's why I’m sharing some real-talk advice on what you need to know about Denver nanny laws, setting up payroll, and hiring the right fit for your family. I hope this guide helps take some of the guesswork out of the process so you can focus on finding that perfect person to help care for your little ones.
My Experience with Hiring a Nanny (It’s Not Just About Babysitting)
When I first hired a nanny for my own family, I was a bit shocked at how many things I needed to learn—like, did you know your nanny is technically considered a household employee? I didn’t, and it took me some time to wrap my head around all the legalities. I made a few mistakes along the way, and now, as an agency owner, I make sure other families don’t have to. Here’s a breakdown of the most important things to know.
1. Understanding Denver's Nanny Laws: What You Should Know
In Denver, hiring a nanny isn’t as simple as paying someone to watch the kids. There are a few legal requirements you need to be aware of:
a. Minimum Wage and Overtime Rules (Yes, Even for Nannies)
Colorado’s minimum wage is higher than the federal rate, and it gets adjusted every year for inflation. As of 2024, it’s $13.65 per hour, but let’s be real—most experienced nannies in Denver expect closer to $23-$32 per hour.
Also, if your nanny works more than 40 hours a week, you’ll need to pay them 1.5 times their hourly rate for the extra hours. It’s worth budgeting for that if you plan to have them around full-time.
b. Paid Sick Leave Requirements (Because Nannies Get Sick Too)
Colorado law requires employers to offer one hour of paid sick leave for every 30 hours worked, up to 48 hours per year. During public health emergencies, the requirement is even higher.
c. Workers' Compensation Insurance (This One Surprised Me)
I didn’t realize that as a household employer, I needed workers’ comp insurance until I started doing this for a living. In Colorado, it’s a must-have, and it protects you if your nanny gets injured on the job.
For more details about our services and how we can help with these requirements, check out our Nanny Placement Services page.
2. Setting Up Payroll for Your Nanny (It’s Not as Complicated as It Sounds)
The first time I set up payroll for my nanny, I was totally overwhelmed. If you’re feeling the same way, trust me—you’re not alone. Here’s a step-by-step guide to make it easier:
a. Start by Getting an Employer Identification Number (EIN)
Think of an EIN like a Social Security number, but for your role as an employer. You’ll need it to report your nanny’s wages and taxes.
b. Register for Colorado Unemployment Insurance
I’ll admit I didn’t think this applied to me when I was hiring my first nanny. Spoiler alert: it does. Colorado law requires employers to register and pay state unemployment taxes to cover your nanny if they ever lose their job.
c. Withhold and Pay the Right Taxes (Don’t Worry, I’ve Got Your Back)
If your nanny earns more than $2,600 in a year, you’re responsible for Social Security and Medicare taxes, which means you need to withhold a portion from their paycheck and match it as an employer. It sounds scary, but it’s just math, and I can walk you through it.
Need help with payroll? I know it can be daunting. That's why we offer Payroll Services for Families to make it a breeze.
3. Other Things I’ve Learned About Hiring a Nanny in Denver
a. Consider Offering Health Benefits
While not required, providing some kind of health insurance or a health stipend can make a huge difference in attracting and keeping a great nanny. Even a little can go a long way to show you value them.
b. Mileage Reimbursement is a Nice Touch
If your nanny drives the kids around, reimbursing for mileage shows you appreciate the wear and tear on their car. The 2024 IRS rate is 65.5 cents per mile, and trust me, it adds up fast.
c. Live-In Nanny? Different Rules Apply
When I hired a live-in nanny during a busy time in my life, I found out that room and board count differently in wage and tax calculations. Make sure you factor that in if you’re considering a live-in situation.
Want more info on hiring? Our Guide to Hiring a Nanny can help answer those questions that pop up.
4. My Advice for Finding the Right Nanny
a. Get Clear on What You Want from Day One
Seriously, save yourself a headache and make a detailed job description. Trust me—you don’t want to find out later that you forgot to include something like meal prep or pet care if those are important to you. The clearer you are, the smoother things will go.
b. Work with an Agency (It’s Totally Worth It)
When I started my agency, I did it because I saw so many families (including mine) struggling with the hiring process. I know firsthand how much stress can come from finding and screening candidates, setting up payroll, and making sure you're following all the rules. That’s why The Natural Nanny Collective is here to help.
Check out our Nanny and Sitter Job Board to see some of the amazing candidates we have.
5. Common Mistakes I See Families Make (And How to Avoid Them)
a. Classifying Your Nanny as an Independent Contractor
I get it, it sounds easier. But misclassifying your nanny can lead to fines, back taxes, and some major headaches down the road. Your nanny is a household employee, and treating them as such ensures they’re covered by laws protecting their wages and benefits.
b. Skipping the Insurance
Workers’ comp isn’t just some extra thing on a to-do list; it’s a must in Colorado. If something happens to your nanny on the job and you’re not covered, it could end up costing way more than the insurance itself.
c. Being Vague About Household Tasks
I’ve been there. I hired sitters who wouldn’t even wash the dinner dishes once the kids were asleep. Now, I make sure every family I work with gets very specific about household duties to avoid any misunderstandings. It’s better to over-explain than under-prepare.
The Bottom Line: You’ve Got This, and I’m Here to Help
I started The Natural Nanny Collective to make it easier for parents to find great childcare without all the stress. We’ve got the resources and expertise to help you navigate the hiring process from start to finish, whether that’s figuring out payroll, setting up interviews, or understanding nanny share options.
You can check out The Nanny Share Connect if you’re interested in sharing a nanny with another family. And if you have any questions, don’t hesitate to reach out to me. I’m always here to chat and help however I can.
Hiring a nanny doesn’t have to be overwhelming. With a little planning and the right resources, you can find the perfect person to care for your kiddos—and I’ll be cheering you on every step of the way!
