The babysitter referral industry needs to be severely monitored by the IRS and heavily regulated by State agencies who take an active interest in child welfare. Essentially, that means legislators! Based on my first hand experience and understanding of industry tactics, these ‘referral agencies’ abuse social internet platforms designed specifically for parents to direct-hire household help for their children and invade colleges to recruit innocent college student with the false hope of “work”.
Meh, it goes like this: The IRS recognizes babysitters as household employees, but most families fail to take this into consideration. Life get’s busy - I get it, trust me.
And then boom, here comes the saving grace, all hail the babysitter referrals!! Or so I keep reading these painstaking news articles about how “babysitter referral agencies have come to save the day!” or rather, “find the missing gap and fill the NEED”.
Ugh. The need.
The need for what? Childcare? Excuse my sarcasm, but I’m a scorched parent who has been down this road and the need is yours and yours alone.
These agencies are not doing ANYTHING special that YOU ALONE cannot DO. After you read this article, it is my hope that you never hire another referral agency again!
There are several babysitter platforms on the internet available for parents who need a nanny or babysitter, care or sittercity to name a few. This is not, by any means, an endorsement.
These platforms already ‘bridge the gap’ because the ‘gap’ is connecting a family need and providing a family in need, with a babysitter.
If that is true (which it is) then I implore you to ask yourself, what is the referral agency exactly doing that is different from the platform?
Exploiting you and your children for profit.
These referral agencies solicit ‘employment’ to the millennial generation, usually in college, by holding career fairs on college campuses. Sometimes, they even breach the sitter platforms. Once employment is piqued, the ‘child care provider’ aka babysitter aka nanny, is now contracted with a referral agency for ‘independent contract work’ under the guise of self-employment.
THAT’S BAD FOR YOUR FAMILY.
First, if you choose to hire a babysitter referral agency here is what you need to know:
They claim to conduct the background check, inquire about the skills of the worker to verify their “qualifications”, provide CPR classes in partnership with some local organization, and supply your family with a properly, vetted out individual. You probably trust what they are saying and you take their word for it, right? WRONG. WRONG. WRONG.
Don’t make this mistake!
Second, YOU and YOUR FAMILY will NEVER KNOW THE TRUTH about the background, qualifications or items that come up in the referral agencies alleged background check.
The referral agency will tell you this information is confidential and cannot be disclosed without consent of the ‘employee’.
OK THIS IS YOUR FIRST RED FLAG.
A) Who’s employee is this? (Allegedly not the referral company.)
B) What employer will ever hire someone without this information? You cannot trust this on face value. DON’T DO IT.
These questions MUST be ANSWERED and this is where it gets messy; your SECOND RED FLAG.
C) If the referral agency has contracted with this individual to work for them for a set number of years, say 2 years, that individual is in a legally binding (although probably unenforceable contract) called a Non-Compete, except they are not ACTUALLY on paper working for the business. Legally, they are working for the family as an independent contractor, since they are recruited as an independent contractor. But this is where the problem is - legally, they are not an independent contractor whatsoever.
Let me ask you this question: When the sitter shows up at your house, do you tell them what is needed to take care of your children? Or are they entering your home as an independent contractor with the skills and experience necessary to perform ALL of the duties of childcare with out instruction or supervision from you? If you are not giving them instructions or controlling their work, then that person is not your employee, and therefore can’t be recognize by the IRS as a household “employee”. Under this designation, you are the employer, and YOU withhold taxes, make bona fide payments to your babysitter. You control their work and their schedule, when and how they work and when and how they are paid. Independent Contractors control their own schedule, when and how they are paid, and everything up to the “results”. Parents, then, are only “in control” in so far as affecting ONLY the RESULTS of the job. No other party can dictate the means or right of control over the worker.
IF you or the referral agency are dictating the 5 w’s, that individual is a bonafide EMPLOYEE and since the company is alleging they are NOT the employer, who do you think just inadvertently, unknowingly, and uncooperatively just became the only liable party for that individual in your home watching your children?
And, chances are, you never screened them. So basically, you have let Jane Doe into your home, you don’t know who she is, she claims she is a bonafide professional nanny and then you find out she is 16 years old.
Two words, two phrases. #me too and #No thanks!
Third, income earned under a 1099 and if filed is severely taxed. Most college students receive college aid and most of those funds, whether through scholarships or some other funding source, is also taxed. By the time a college student files their return, they are facing tax liability that would put them out of business in an independent contractor position. These students are better off acquiring a full time job with benefits than to risk working in this position. Who is giving them a 1099, anyway?
From an internal perspective these owners are ‘gagging’ their works under the auspice of non-disclosure agreement. So, their referrals are not able to discuss the applications, recruiting, hiring or employment status with any family they are referred to and the families accepting their referral in ‘good faith’ that a background check has been done or these individuals have been properly vetted by the referral agency soon learn that the agency cannot disclose this information to them under and circumstances because they are allegedly “legally bound” by the terms of their inside non-disclosure agreements.
Additionally, the recruited sitters are required to sign a non-compete and proffered ‘employment’ by the referral agencies for an a specified length of time. That could be anywhere from 1 to 2 years, or longer. Thus, any sitter bound under these agreements cannot be hired outside of the agency.
That means if you place a request for a sitter and one shows up, but it doesn’t work out, you will eventually not be able to find help on those social platforms.
It is therefore in my opinion, that you do not turn to these agencies to “bridge the gap” to help you find and fill your childcare needs.
