Paying an individual to help with housecleaning differs substantially from hiring a company. He or she will be your employee, not a contractor. You must negotiate pay and benefits.

As with a housecleaning company, you’ll want to hire an individual you can work with comfortably on a regular basis. He or she must understand, and fulfill, your particular expectations as to what jobs they should do and how they should do them.

The personal nature of your relationship with an individual housecleaner can be problematic. You may feel ill at ease giving orders or voicing complaints. Your employee may feel awkward about requesting a raise, extra pay for special jobs, or time off.

To help you screen prospective household employees and define a satisfactory relationship, we share results of a survey of Checkbook and Consumer Reports subscribers who have employed housecleaning help, guidelines for household employment, and a summary of employers’ legal responsibilities.

Survey of Employers

We surveyed more than 300 consumers who employ individual housecleaners. Most have help weekly or biweekly, but some have fewer than one visit a month and a handful have daily visits. Here are answers to some of the questions we asked—

  • How did you find the housecleaner? Nearly 75 percent were steered to their employees by friends, relatives, neighbors, or coworkers. The next most frequent source was advertisements.
  • How did you check out the housecleaner’s competence and honesty? Of respondents who found their employees through sources other than referrals from friends, relatives, neighbors, or coworkers, only about one-third checked their employees’ references at the time of hiring.
  • How much do you pay? We asked about pay per visit, number of rooms in the respondent’s home, and number of hours for a typical visit, and found big variations in pay rates. For example, some employers pay a rate that calculates out to less than $15 per hour, while others pay more than $50 per hour. On average, surveyed employers pay their housecleaners $107 per visit, which when factoring in hours worked equals about $32 per hour.
  • What other types of payments or benefits do you provide? Few respondents reported they reimburse for transportation costs (two percent), provide meals (three percent), offer paid vacation time (one percent), or offer paid holidays (eight percent), but many reported they pay bonuses around the holidays and offer used clothing and household items.
  • Paying employer taxes. Very few respondents reported they pay the employer’s share of Social Security taxes and unemployment taxes (eight percent) or withhold income tax (four percent).
  • How do you rate your housecleaner? We asked respondents to rate their employees on doing work properly, neatness, promptness/arriving on time, and overall quality. Compared to the average scores from consumers who rated housecleaning companies, the ratings of individuals were, on average, substantially higher than those for housecleaning service companies.
  • What problems have you had with household workers? About half of our surveyed consumers who employ individual housecleaners reported having problems with their current housecleaners or with past pros. Common issues included broken items, language-barrier problems, and declining quality of work over time. Some mentioned theft, tardiness, not showing up, and not being thorough.
  • Do you have an explicit agreement with your housecleaner regarding pay, duties, schedule, benefits, and other aspects of employment? Seventy-five percent had no agreement, and only a handful of respondents had written agreements.

Screening Workers

When recruiting a new worker, always contact past employers, who can fill you in on the prospect’s strengths and weaknesses. Describe your expectations, and ask about any problems they may have experienced.

Before interviewing candidates, write out a job description detailing the tasks you require and how often you want them done. Assess your own expectations honestly. If you are picky about certain things, tell the candidate about them during the interview. If some tasks are out of the ordinary, discuss them.

Work out all terms of employment and put them in writing. Discuss and reach an agreement on pay, sick leave, vacations, holidays, hours, and rules regarding meals and rest periods. Also, establish a probationary period: It gives you and the employee the opportunity to back out gracefully if problems arise.

During the probationary period, get acquainted with each other. Be at home during the first visit or two, and explain any peculiarities of your home. As work is completed, discuss any areas of dissatisfaction. Do not let complaints pile up and then bring them up after a month. Be straightforward and honest with criticism and directions.

Legal Requirements

A major disadvantage of employing an individual rather than using a housecleaning service is the added legal responsibilities associated with being an employer. Many families who employ household workers either are unaware of their legal obligations or choose to ignore them. Indeed, few of our surveyed consumers who employ individuals for household work said they pay Social Security or unemployment taxes. The following summarizes the legal requirements of employers of household workers.

Verification of Citizenship and Work Eligibility

When you hire an employee, federal law requires you to complete with him or her Form I-9, Employment Eligibility Verification for the U.S. Citizen and Immigration Services (USCIS). To complete this form, you must check the employee’s identification or other documents that prove either that he or she is a U.S. citizen or has the necessary documentation to work in the U.S. The verification form is not filed with USCIS, but you must keep the completed form on file for three years after the date of hire or for one year after employment ends, whichever is later. You can download the form at www.uscis.gov.

Federal Taxes

Federal law requires that Social Security and Medicare taxes be paid for all adults (18 years of age and older) who are paid more than $2,000 per year for household work. In 2017, the employer’s share of Social Security is 6.2 percent and 1.45 percent for Medicare. The employee’s share of these taxes is currently also 6.2 percent for Social Security and 1.45 percent for Medicare. If you employ someone, you are responsible for payment of both your employee’s share of these taxes and your own share. You can either withhold your employee’s share from his or her wages or pay it yourself.

If you pay a household employee $1,000 or more during a calendar quarter, you must also pay federal unemployment taxes. The tax rate is six percent of the first $7,000 in wages, but the federal government offers a credit to offset state unemployment taxes (see below) of up to 5.4 percent, regardless of the actual state tax rate (you get it by filing Form 940 with your income tax return). This means that if you properly pay state unemployment taxes, the effective federal unemployment tax rate is 0.6 percent.

Payments are made annually by completing a Schedule H on your Form 1040 income tax return. Failure to pay these taxes can result in penalties as well as the obligation to pay both the employer’s and the employee’s share of the taxes.

Although you are not legally required to withhold federal income tax, you are required to file forms W-2 and W-3 with the Social Security Administration each year. The Social Security Administration records earnings and sends the information to the IRS.

For more information, see IRS “Publication 926: Household Employer’s Tax Guide.”

State Taxes

California does not require employers to withhold state income taxes for household workers. State income taxes are the employee’s responsibility.

If you pay a household worker $750 or more in a calendar quarter, you must register as an employer with the state’s Employment Development Department (EDD). Do this online at https://eddservices.edd.ca.gov, or call 888-745-3886.

If you pay a household worker $750 or more in a calendar quarter, you must withhold state disability insurance tax for that worker and remit the amount to the EDD. The disability insurance tax rate for 2017 is 0.9 percent.

If you pay a household worker $1,000 or more in a calendar quarter, you are also required to pay unemployment insurance and employment training taxes to the EDD. For 2017, the unemployment insurance tax rate for new employers is 3.4 percent of the first $7,000 of wages paid; the employment training tax rate is 0.1 percent, with a maximum tax of $7 per employee.

For more information, contact your local EDD office or visit www.edd.ca.gov.

Workers’ Compensation Insurance

Workers’ compensation insurance covers costs such as medical care and lost wages for workers who are injured or killed on the job. California law requires all employers to purchase workers’ compensation insurance coverage for household workers. You can buy a workers’ compensation policy from your homeowners insurance carrier or from an insurance agent. If you fail to maintain workers’ compensation coverage for an employee, and he or she sustains injuries while working for you, you will be liable for any medical or legal expenses and could face state-imposed criminal and civil legal penalties.

Paid Sick Leave

California requires employers of household workers to provide at least one hour of paid sick leave for every 30 hours of work. Employers can cap accrued sick leave at 24 hours per year (in Oakland and San Francisco, the caps are 40 hours per year).

State Rules on Payroll Records

California requires employers of household workers to provide written notification of pay rates at the time of hire and whenever pay rates change. Each notification must include the following:

  • Amount of regular and overtime hourly pay rate and any special pay rates
  • Schedule of paydays
  • Employer’s name, address, and phone number
  • Name, address, and phone number of employer’s workers’ compensation insurance carrier

Employers must also issue paystubs with every payment documenting number of hours worked, total gross wages, deductions, net pay, employer and employee names, employers’ addresses, and the last four digits of employees’ Social Security or tax identification numbers.