Hi everyone, I have been asked to share information about how much staff cost in a typical childminding setting.
Disclaimer: this list is not exhaustive and all costs will vary depending on what you are doing and how much knowledge you already have of the safer recruitment process. However, I hope this provides a useful starting point...
There is no doubt that working with staff can be a positive experience, but you do need to think about the practicalities.
First of all, you must think about staff wages – how much can you afford to pay your staff member? For example, do you want to / can you afford to pay them the minimum wage or a higher rate?
The answer to this question usually starts with working out how many extra children you will need to take on in your childminding setting so you can pay your staff member. For example, if your staff member costs you the national living wage of £10.42 / hour (from April 2023) it’s not just £10.42 – it’s all the other costs as detailed below and might mean your income just to pay that staff member needs to be closer to £11 or even £12 an hour to make your staff member affordable.
What will happen if you cannot find the extra children straight away? You might think that you need a staff member to support 1 family who need an extra day ... but your staff member will cost you significantly more than the income brought in by 1 extra child.
This means that you will need to cost it out – to work out how many children you will need to care for so you can pay your staff members’ wage. Questions to ask yourself include:
**Will the children need to attend full-time or part-time?
**What happens if parents ask for a term-time only contract – will you need to advertise for and bring in extra holiday only children?
**What happens if the staff member only wants to work term time – will you be caring for extra children in the holidays so you can have a term-time only staff member?
Initial costs to budget
Initial expenses which you might need to pay if you have a staff member in a childminding setting include, for example –
**Cost of you attending / completing safer recruitment training.
**Your Local Authority might require to you apply for planning permission before you can take on an assistant and / or increase your ratios. There will be cost implications for the application and it might not be granted. Think about how you will pay your assistant if you cannot increase your ratios before or after the planning process has completed.
**Recruitment costs – if you have to pay a recruitment service or advertise the position.
**Any ‘reasonable adjustments’ you might need to make to your house and / or garden access to ensure you are inclusive and compliant with the Equality Act 2010.
**Contracts, policies and procedures and other documents for Ofsted and safer recruitment – these will take time to put together and update regularly.
**Printing costs - staff handbook, contract, policies etc.
When you find your staff member
There are some initial set-up costs including, for example:
**DBS disclosure fee – and the update service for at least the first year – if the cost of the DBS takes the staff member’s wage to below minimum wage for their age.
**Paediatric first aid training course – must be updated every 3 years.
**Local Authority safeguarding training course – if available.
**Assistant insurance – Childcare.co.uk include it as standard for gold members who have opted into the insurance offer, but you might be charged extra by your insurance company.
**If your assistant is doing a level 3 (or similar) early years course, you will need to pay training costs additional to any grant they might receive. They will also need to be provided with 20% off the job time which you pay them for at their normal wage – and during which time they accrue holiday pay.
Important note
The Ofsted letter to state an assistant is suitable to work with you can take some months to come through. During this time, your assistant can work fully supervised, but you cannot increase your ratios and you cannot leave them in sole care of children – think about how you will pay your assistant if you cannot increase your ratios while Ofsted process the application.
Ongoing staff costs
You will then need to consider, for example:
**Holiday pay – all staff are entitled to 5.6 weeks holiday pay a year.
**Uniform – if you expect your assistant to wear something specific – for example, a black t-shirt with logo and ‘smart’ trousers or shoes and buying the clothing will take them below minimum wage.
**Ongoing training and professional development – you must pay them for their time, as well as travel and any course fees, if you expect them to do professional development outside work hours.
**National insurance if your staff members earns more than £9,100 for the year at 13.8% (correct 02.2023).
**Sick pay depending on what is detailed in your contract.
**A contribution to their pension if they choose to save for their pension through NEST or similar – this is a contribution of a minimum of 3% of their qualifying earnings. They can choose to opt out but you must offer a pension to them if they are older than 22 years and earn over the current threshold of £10,000/year (2023).
**Meals / snacks – will you expect your staff member to bring their own food from home or will you provide them with food and drinks through the day? If you are providing food, you should cost it into your budget.
**PAYE payroll company – or online software – if you choose to use a paid service to support you with pay, tax, national insurance, pension, holiday pay etc rather than the HMRC free payroll tools. There is also end of year reporting which will take your time to complete.
**Will you need to buy your employee any equipment to do their job? For example, they might need to do record keeping for a college course or take notes if you send them on training. You should not assume they will provide these resources themselves.
**You might need to provide extra food, toys and games if you have to take on extra children.
**Consider maternity, paternity, adoption, shared parental and parental bereavement pay if your employee or partner is pregnant. To comply with the Equality Act 2010, you cannot ask about whether a potential employee is or intends to get pregnant.
**You might find that you need extra floor space to care for the extra children you need to take on to pay your assistant – where will that be? How will you arrange it?
**You will want to treat your staff member well – this might mean, for example, buying them gifts on their birthday and at significant times through the year such as Christmas and maybe taking them out for a meal or paying for other social functions.
**If you employ an apprentice or young person to be your assistant, you will have to pay them more as they move up the age ranges or when they have qualified. You should cost this increasing wage into your business planning.
Most importantly
Don’t forget perhaps the most important factor – your time. You will need to set aside your time to interview, train and support your assistant; documentation will take time to complete; you will have to learn how to do payroll and provide a payslip; there are other ongoing supervision and training requirements in the statutory framework and more. Your time is valuable and all these jobs will need to be done outside of normal working hours.
You might find it helpful to consider whether you will be working harder – and your house subject to more wear and tear – and higher heating bills and food costs vs the benefits of taking on an assistant and growing your business.
I hope this helps as a starting point - your business plan will further support the process.
Best wishes, Sarah.
.......................................
Picture (C) Google imageS | HMRC.
Disclaimer: this list is not exhaustive and all costs will vary depending on what you are doing and how much knowledge you already have of the safer recruitment process. However, I hope this provides a useful starting point...
There is no doubt that working with staff can be a positive experience, but you do need to think about the practicalities.
First of all, you must think about staff wages – how much can you afford to pay your staff member? For example, do you want to / can you afford to pay them the minimum wage or a higher rate?
The answer to this question usually starts with working out how many extra children you will need to take on in your childminding setting so you can pay your staff member. For example, if your staff member costs you the national living wage of £10.42 / hour (from April 2023) it’s not just £10.42 – it’s all the other costs as detailed below and might mean your income just to pay that staff member needs to be closer to £11 or even £12 an hour to make your staff member affordable.
What will happen if you cannot find the extra children straight away? You might think that you need a staff member to support 1 family who need an extra day ... but your staff member will cost you significantly more than the income brought in by 1 extra child.
This means that you will need to cost it out – to work out how many children you will need to care for so you can pay your staff members’ wage. Questions to ask yourself include:
**Will the children need to attend full-time or part-time?
**What happens if parents ask for a term-time only contract – will you need to advertise for and bring in extra holiday only children?
**What happens if the staff member only wants to work term time – will you be caring for extra children in the holidays so you can have a term-time only staff member?
Initial costs to budget
Initial expenses which you might need to pay if you have a staff member in a childminding setting include, for example –
**Cost of you attending / completing safer recruitment training.
**Your Local Authority might require to you apply for planning permission before you can take on an assistant and / or increase your ratios. There will be cost implications for the application and it might not be granted. Think about how you will pay your assistant if you cannot increase your ratios before or after the planning process has completed.
**Recruitment costs – if you have to pay a recruitment service or advertise the position.
**Any ‘reasonable adjustments’ you might need to make to your house and / or garden access to ensure you are inclusive and compliant with the Equality Act 2010.
**Contracts, policies and procedures and other documents for Ofsted and safer recruitment – these will take time to put together and update regularly.
**Printing costs - staff handbook, contract, policies etc.
When you find your staff member
There are some initial set-up costs including, for example:
**DBS disclosure fee – and the update service for at least the first year – if the cost of the DBS takes the staff member’s wage to below minimum wage for their age.
**Paediatric first aid training course – must be updated every 3 years.
**Local Authority safeguarding training course – if available.
**Assistant insurance – Childcare.co.uk include it as standard for gold members who have opted into the insurance offer, but you might be charged extra by your insurance company.
**If your assistant is doing a level 3 (or similar) early years course, you will need to pay training costs additional to any grant they might receive. They will also need to be provided with 20% off the job time which you pay them for at their normal wage – and during which time they accrue holiday pay.
Important note
The Ofsted letter to state an assistant is suitable to work with you can take some months to come through. During this time, your assistant can work fully supervised, but you cannot increase your ratios and you cannot leave them in sole care of children – think about how you will pay your assistant if you cannot increase your ratios while Ofsted process the application.
Ongoing staff costs
You will then need to consider, for example:
**Holiday pay – all staff are entitled to 5.6 weeks holiday pay a year.
**Uniform – if you expect your assistant to wear something specific – for example, a black t-shirt with logo and ‘smart’ trousers or shoes and buying the clothing will take them below minimum wage.
**Ongoing training and professional development – you must pay them for their time, as well as travel and any course fees, if you expect them to do professional development outside work hours.
**National insurance if your staff members earns more than £9,100 for the year at 13.8% (correct 02.2023).
**Sick pay depending on what is detailed in your contract.
**A contribution to their pension if they choose to save for their pension through NEST or similar – this is a contribution of a minimum of 3% of their qualifying earnings. They can choose to opt out but you must offer a pension to them if they are older than 22 years and earn over the current threshold of £10,000/year (2023).
**Meals / snacks – will you expect your staff member to bring their own food from home or will you provide them with food and drinks through the day? If you are providing food, you should cost it into your budget.
**PAYE payroll company – or online software – if you choose to use a paid service to support you with pay, tax, national insurance, pension, holiday pay etc rather than the HMRC free payroll tools. There is also end of year reporting which will take your time to complete.
**Will you need to buy your employee any equipment to do their job? For example, they might need to do record keeping for a college course or take notes if you send them on training. You should not assume they will provide these resources themselves.
**You might need to provide extra food, toys and games if you have to take on extra children.
**Consider maternity, paternity, adoption, shared parental and parental bereavement pay if your employee or partner is pregnant. To comply with the Equality Act 2010, you cannot ask about whether a potential employee is or intends to get pregnant.
**You might find that you need extra floor space to care for the extra children you need to take on to pay your assistant – where will that be? How will you arrange it?
**You will want to treat your staff member well – this might mean, for example, buying them gifts on their birthday and at significant times through the year such as Christmas and maybe taking them out for a meal or paying for other social functions.
**If you employ an apprentice or young person to be your assistant, you will have to pay them more as they move up the age ranges or when they have qualified. You should cost this increasing wage into your business planning.
Most importantly
Don’t forget perhaps the most important factor – your time. You will need to set aside your time to interview, train and support your assistant; documentation will take time to complete; you will have to learn how to do payroll and provide a payslip; there are other ongoing supervision and training requirements in the statutory framework and more. Your time is valuable and all these jobs will need to be done outside of normal working hours.
You might find it helpful to consider whether you will be working harder – and your house subject to more wear and tear – and higher heating bills and food costs vs the benefits of taking on an assistant and growing your business.
I hope this helps as a starting point - your business plan will further support the process.
Best wishes, Sarah.
.......................................
Picture (C) Google imageS | HMRC.