Nanny Agency Contracts: What Should UK Terms Cover?

Running a nanny agency is personal work. You're helping families find someone they can trust in their home, while also protecting your own time, reputation and fees.

A well-written nanny agency contract in the UK does more than say when you get paid. It sets clear expectations around placement fees, refunds, safeguarding checks, employment responsibilities and what happens after the nanny starts.

This doesn't have to be complicated, but it does need to be clear. Families are often making a big decision under pressure, so your terms should be easy to understand and hard to misread.

Do You Need Written Terms With Families?

Yes, you should have written agency terms with every family before you start introducing candidates.

For most nanny agencies, your family-facing agreement is the document that protects your placement fee and explains exactly what service you're providing. It also helps you comply with the rules that apply to employment agencies in Great Britain, including the Employment Agencies Act 1973 and the Conduct of Employment Agencies and Employment Businesses Regulations 2003.

Your terms with families should usually cover:

• what type of service you're providing, such as permanent placement, temporary cover, maternity nanny placement or babysitting introductions
• when a placement fee becomes payable
• how your replacement guarantee or refund policy works
• what checks you carry out on candidates
• what the family is responsible for as the nanny's employer
• limits on your responsibility after the placement starts
• privacy and data handling, especially for sensitive family and childcare information

Families are usually consumers, not businesses. That means your terms also need to be fair and transparent under the Consumer Rights Act 2015. If you sell your services online, over the phone or by email, the Consumer Contracts Regulations 2013 can also apply, including rules about pre-contract information and 14-day cancellation rights.

Practically, this means you shouldn't hide your fees in small print, charge unclear cancellation fees or use terms that let you keep money in a way that feels one-sided. If a family later challenges your invoice, clear written terms are often the difference between a straightforward payment conversation and a messy dispute.

What Should A Nanny Agency Placement Fee Agreement Say?

A nanny placement fee agreement should say exactly when your fee is triggered, how it's calculated and when it must be paid.

This is one of the most common areas of disagreement. A family might think they only pay once the nanny completes a trial. You might expect payment once the family makes an offer and the nanny accepts. Your terms need to settle that upfront.

Common Ways To Structure Placement Fees

You can structure your placement fee in a few different ways, depending on your agency model:

• Fixed fee: a set amount for each successful placement.
• Percentage fee: a percentage of the nanny's gross annual salary or expected earnings.
• Tiered fee: different fees for full-time, part-time, temporary, live-in or overseas roles.
• Registration fee plus success fee: a smaller upfront fee and a larger fee when a placement is made.

Whatever you choose, be clear about whether VAT is included or added, when invoices are issued and how quickly families need to pay.

You should also define what counts as a placement. For example, your agreement might say a placement happens when:

• the family offers the role and the candidate accepts
• the candidate starts work
• the family engages the candidate directly or indirectly within a set period after your introduction

That last point matters. If you introduce a candidate and the family contacts them months later to arrange work outside your agency, your terms should explain whether a fee is still payable. The time period needs to be fair and reasonable, especially because you're dealing with consumers.

A Simple Example

Say Priya runs a small nanny agency in Manchester. She introduces a nanny to a family, the family interviews her, then says they've decided not to proceed. Six weeks later, Priya discovers the same family has hired that nanny directly.

If Priya's terms clearly say her introduction fee applies where a family engages a candidate within six months of introduction, she's in a much stronger position to recover her fee. Without that wording, she may struggle to prove what was agreed.

Can You Offer A Replacement Guarantee Instead Of A Refund?

Yes, you can usually offer a replacement guarantee instead of a refund, as long as the terms are fair, clear and explained before the family agrees.

A replacement guarantee is common in childcare recruitment. It might say that if the nanny leaves or the placement ends within a certain period, you'll introduce suitable replacement candidates at no extra placement fee.

Your guarantee should answer these questions:

• How long does the guarantee period last?
• Does it start from the offer acceptance date or the nanny's first working day?
• What events are covered, such as resignation, dismissal or failure to start?
• What events are excluded, such as the family changing the role, reducing pay or acting unreasonably?
• How quickly does the family need to tell you there's a problem?
• Does the family need to have paid your invoice before the guarantee applies?

For example, your terms might say the replacement guarantee doesn't apply if the family materially changes the job after the nanny accepts, fails to pay the nanny on time, refuses reasonable replacement candidates or dismisses the nanny for a reason unrelated to suitability.

If you do offer refunds, be specific. A vague promise like refund available if things don't work out can create confusion. Instead, set out whether the refund is full or partial, whether it reduces over time and what conditions apply.

Because families are consumers, refund and cancellation terms need extra care. Under the Consumer Rights Act 2015, terms can be challenged if they create a significant imbalance against the consumer. Under the Consumer Contracts Regulations 2013, families may have a 14-day cancellation period for distance contracts, unless the rules about starting services early and losing cancellation rights have been properly handled.

This is one area where generic templates often miss the detail. Your refund wording should match how your agency actually works.

What Safeguarding Checks Should Your Terms Cover?

Your terms should explain the checks you carry out, but they shouldn't promise a risk-free placement.

Nanny agencies deal with trust at a very high level. Families want confidence that you've vetted candidates properly. At the same time, you need to be careful not to guarantee a candidate's future conduct or take on responsibility that belongs to the family as the employer.

Some checks aren't just optional good practice. For nanny roles involving children, the worker will usually be working with a vulnerable person under the Conduct Regulations. Before introducing or supplying a candidate, an agency or employment business must obtain specified information and confirmations about the hirer, the role and the work-seeker, and take reasonably practicable steps to protect both the family and the candidate.

Your terms and internal process should address the checks that are required for the type of placement you make. For childcare roles, this will usually include:

• checking the candidate's identity
• checking relevant experience, training, qualifications and any required authorisations
• checking right to work authorisation where required
• obtaining two written references from people who aren't relatives of the candidate for vulnerable-person roles
• checking copies of required qualifications, registrations or authorisations where the role requires them
• offering relevant copies of required documents and references to the family before introduction or supply, where the Conduct Regulations require this
• telling the family clearly if any required information can't be obtained, what steps you've taken to try to obtain it and what this means for the proposed introduction or supply

There may also be optional checks or extra screening steps that go beyond the minimum legal requirements. For example, you might carry out additional interviews, ask suitability questions, verify first aid training, or review gaps in work history. If you include these in your terms or marketing, describe them accurately and make sure your team follows the same process every time.

For roles involving unsupervised childcare, an enhanced DBS check with children's barred list information may be relevant if the role meets the criteria for regulated activity. You should be careful with DBS information because it can involve criminal offence data. Under the UK GDPR and the Data Protection Act 2018, you need a lawful basis for processing personal data and an appropriate condition for handling criminal offence data.

You should also think about your privacy documents. Families may share children's names, routines, health information, addresses, school details and household arrangements. Candidates may share identity documents, references, qualifications and DBS information. Your privacy notice should explain what you collect, why you collect it, who you share it with and how long you keep it.

Your terms should make the boundary clear. You can say that you take reasonable steps to screen candidates based on the information available to you and in line with your legal obligations, but the family remains responsible for making the final hiring decision and satisfying themselves that the nanny is suitable for their household.

Who Is The Nanny's Employer After Placement?

It depends on your model, but for many permanent nanny placements, the family is the nanny's employer after the placement starts.

This distinction is a big one. If your agency simply introduces candidates and the family hires the nanny directly, your terms should say you're not the nanny's employer and you don't manage the employment relationship after placement.

The family may then be responsible for employer obligations such as:

• issuing a written employment contract or statement of employment particulars by day one, as required under the Employment Rights Act 1996
• paying at least the National Minimum Wage or National Living Wage
• running payroll and dealing with PAYE where required
• providing paid holiday, usually 5.6 weeks a year for a full-time worker
• managing sickness, absence, discipline and dismissal fairly
• considering pension auto-enrolment duties where the rules apply
• checking the nanny has the right to work in the UK

Your agreement shouldn't suggest you're handling these duties unless you actually are.

If you supply temporary nannies or agency workers, pay them, control their work or provide an ongoing managed service, your legal position may be different. You may be operating as an employment business rather than only an employment agency. That can bring extra rules, including the Conduct Regulations and, for agency workers, the Agency Workers Regulations 2010.

The practical point is simple: your contracts need to match your real operating model. If your website says you provide fully managed childcare cover but your terms say you only make introductions, that mismatch can create problems.

Do You Need Separate Terms With Candidates?

Yes, you should usually have separate candidate terms and conditions as well as family terms.

Your candidate terms don't need to be long, but they should make the relationship clear. They help you manage expectations with nannies and protect your agency's process.

Your candidate terms can cover:

• how candidates register with your agency
• what information and documents they need to provide
• consent to contact referees and share candidate profiles with families
• the candidate's duty to provide accurate and up-to-date information
• how interviews, trials and offers are handled
• confidentiality around family information
• data protection and privacy notices
• whether the agency is acting as an employment agency or employment business

Be careful with candidate fees. Employment agencies are generally restricted from charging work-seekers fees for finding them work under the Employment Agencies Act 1973 and the Conduct Regulations. Childcare recruitment isn't an area where you should assume candidate placement fees are allowed.

If you offer optional paid services to candidates, such as CV support or training, get tailored advice first. The rules are technical, and the wording needs to make it clear that the candidate doesn't have to buy those services to be considered for work.

How Do You Limit Your Responsibility After Placement?

You can limit your responsibility after placement, but the limit must be fair and must not try to exclude things the law doesn't let you exclude.

For a permanent placement model, your terms can say your role ends once the introduction or placement has been made, except for any replacement guarantee you have promised. This helps avoid families expecting you to manage performance issues, payroll, holiday requests or employment contract disputes between the family and nanny.

Your limitation wording might cover points like:

• you don't supervise the nanny's day-to-day work
• you don't guarantee the nanny will stay for any particular period
• you don't accept responsibility for the family's employment law decisions
• you aren't responsible for changes the family makes to the role after placement
• your liability is capped at a fair and reasonable amount, often linked to the fees paid

You can't exclude liability for death or personal injury caused by negligence, and consumer-facing limitations need to be fair under the Consumer Rights Act 2015. Very broad exclusions can be difficult to rely on, especially if they leave the family with no meaningful remedy.

A balanced approach usually works best. You can protect your agency without sounding like you're avoiding responsibility for the service you actually provide.

Common Mistakes To Avoid

The biggest mistake is using terms that don't match how your agency operates.

Nanny agencies often grow organically. You might start with one type of placement, then add temporary cover, maternity nannies, after-school care or overseas candidates. If your terms don't keep up, gaps appear quickly.

Watch out for these common issues:

• Unclear fee triggers: families don't know whether payment is due at interview, offer, acceptance or start date.
• Vague refund promises: your refund or replacement policy sounds helpful, but doesn't say how it works.
• Overpromising on checks: your marketing says candidates are fully guaranteed, but your actual process is based on required checks and reasonable screening.
• No consumer cancellation wording: families sign up online, but your terms don't deal with the 14-day cancellation period.
• Blurry employer boundaries: the family thinks you're responsible for payroll or employment disputes after placement.
• Poor data handling: DBS information, references and children's details are collected without clear privacy processes.

It's also worth reviewing your website, booking forms, emails and invoices against your terms. If each document says something different, the family may rely on the version that suits them best.

Key Takeaways

• Your family terms should clearly explain your service, placement fees, payment timing, replacement guarantee and refund policy.
• Families are usually consumers, so your terms need to be fair and transparent under the Consumer Rights Act 2015.
• For nanny roles involving children, your checks need to reflect the Conduct Regulations, including vulnerable-person reference and document requirements.
• Your contract should make it clear who employs the nanny and who handles payroll, holiday, dismissal and other employment duties.
• Candidate terms help protect your recruitment process, but you need to be careful about charging work-seekers fees.
• Your contracts, website and day-to-day process should all say the same thing.

If you'd like help with your family terms, candidate terms, placement fee wording or nanny agency refund policy, you can reach us at 08081347754 or team@sprintlaw.co.uk for a free, no-obligations chat.