Babysitting Guide

Can Babysitters File for Unemployment? (Eligibility Guide)

24 Sep 2021

Written & Illustrated by
Matthew James Taylor

When the economy is in trouble, babysitters can suffer just like everyone else. If you're suddenly laid off, you may want to file for unemployment. But are you eligible?

Regular working babysitters, nannies, and other full-time caregivers can file for unemployment if they are laid off because they are considered employees and so they are usually covered for government assistance. Part-time and casual sitters are typically not eligible.

In this article, I'll explain some situations where babysitters can file for unemployment and other cases where it might not be an option. I'll also go over the unemployment benefits offered in different countries and what requirements you must meet in order to be eligible.

Can Babysitters Claim Unemployment Pay?

Whether or not you're eligible for unemployment or other government assistance can be quite a complicated topic.

Just like taxes, your eligibility will depend on a number of factors. It's hard to give a simple yes or no answer since each babysitter's situation will be unique.

Some important things to consider are where you live, whether you're an employee or a contractor, your age, and your income.

Are You an Employee or a Contractor?

When trying to figure out if you're eligible for unemployment, this is the first question that you should ask yourself.

Independent contractors are usually not able to file for unemployment. That's because they don't pay the same payroll taxes that employees do.

If you're a part-time babysitter who gets paid in cash, you won't be able to file for unemployment in most cases.

Nannies or full-time babysitters who have taxes withheld from their pay by their employer are most likely to be eligible for unemployment. If you see deductions on your pay stub for unemployment or something similar, then you've been paying into a government program and should be eligible for benefits.

There are a few additional things to keep in mind though.

Normally you won't be eligible for unemployment if you were fired because of a serious infraction, such as showing up late several times.

You also won't be eligible if you just stop babysitting because you were tired of working.

Babysitting can be an awesome career! Read my article Babysitting as a Career (8 Reasons Why it’s a Great Choice) to learn more.

Does Your Employer Pay You "Under The Table?"

If your employer is paying you legally and you file for unemployment, there's no need to worry about unintended side-effects from the government getting notified.

However, some employers may pay their babysitter or nanny in cash and neither party declares this to the government. There are several reasons why this happens. A babysitter may not be legally allowed to work in the country, or it may just be beneficial to both parties to avoid paying taxes.

However, this can cause a big problem when it comes to filing for unemployment.

You might be rejected since you have not been paying taxes that make you eligible to claim unemployment in the first place.

It can also create a lot of trouble for your employer if you file for unemployment under these circumstances. They may end up owing thousands of dollars in penalties, fines, and back taxes for failure to file on your behalf.

Being paid illegally can be tempting for babysitters in the short term. But it's important to consider the long-term implications on your ability to collect unemployment, government pensions or retirement programs, and other benefits later on.

Most babysitters will need to pay some kind of taxes, regardless of whether they're employees or contractors. Read my article Do Babysitters Have To Pay Taxes? (Yes, and Here's How) to learn more.

Are You Old Enough?

In some countries, you aren't able to claim any unemployment benefits until you're at least 18 years old.

Even if you're a full-time babysitter and having tax deducted from your pay, you may not be eligible to claim unemployment benefits if you're only 17 years old. In that case, if you're laid off, you may be out of luck.

What Are Your Income and Assets?

Some countries will take your whole financial situation into account.

You may not be able to file for unemployment or some other benefits if you have over a certain amount of money in savings, or even if your partner's income is too high.

If you babysit in your spare time but also have a full-time job, you won't be able to claim unemployment unless you're also laid off from both jobs.

Special COVID-19 Support for Babysitters

In the wake of the COVID-19 pandemic, many countries have extended their unemployment insurance coverage.

Many people may now be eligible for unemployment who previously weren't. This includes even part-time workers or contractors in some cases.

Unemployment Benefits by Country

I've put together a quick breakdown of some basic unemployment rules in different countries.

You'll want to look into your specific country in more detail to make sure that you're eligible and find out how to apply. But this should give you a quick idea of whether you'll be eligible or not.

Canada

Canada has a number of different benefits currently available, and you don't necessarily need to be an employee to qualify.

Employment Insurance (EI)

You do need to be an employee to qualify for Employment Insurance. This is the traditional "unemployment" payroll item in Canada that is deducted from everyone's pay stub. Only nannies and other full-time employed childcare providers who have been laid off will be eligible. If you fit into this category, you can receive at least $500 per week before taxes.

Caregiving Benefit

If you have a child of your own who is 12 or under and needs supervised care, you can take advantage of a caregiving benefit. This entitles you to $500 per week ($450 after taxes are withheld) and enables you to stay home with your own child. This is very useful if your child is currently doing remote learning.

Canada Recovery Sickness Benefit

If you're unable to work due to sickness or you need to self-isolate because of COVID-19, you may be eligible for the short-term Canada Recovery Sickness Benefit. This allows you to claim $500 per week.

Canada Recovery Benefit

If you're self-employed or otherwise aren't eligible for Employment Insurance, you may still be eligible for the Canada Recovery Benefit. It's paid out as $900 after-tax for every two-week period that you're eligible.

To qualify you must have had a 50% reduction in your average weekly income compared to the previous year due to COVID-19. You must have also earned at least $5,000 in 2019, 2020, or in the 12 months before you apply.

Similar to Employment Insurance, you cannot claim this benefit if you've quit or had your hours reduced voluntarily.

People who run a daycare business out of their home or babysit for enough hours as a contractor should be able to claim this benefit. (A babysitter who worked at least 7 hours per week at $15 per hour in the previous year would meet the earnings requirement.)

United States

The CARES (Coronavirus Aid, Relief, and Economic Security) Act recently signed into law gives states the option to extend unemployment compensation to independent contractors and other workers who aren't normally eligible for unemployment benefits. Check with your state's local unemployment office to see what you're eligible for.

United Kingdom

The UK has created a "New Style" Jobseeker's Allowance. If you usually work less than 16 hours per week, you may be able to claim a benefit as long as you've made enough National Insurance contributions over the last 2 or 3 years.

If you're between 18 and 24 years old you can get up to £58.90 per week. Those over 25 can get up to £74.35 per week.

You may also be entitled to Universal Credit if you have less than £16,000 in savings. The monthly standard allowance is £342.72 per month if you're single and under 25. You may get more if you're older or in a couple.

You can claim both Jobseeker's Allowance and Universal Credit at the same time.

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Australia

Australia has several programs that unemployed babysitters may be eligible for.

Youth Allowance

If you're under 21 and looking for work, or 24 or younger and you're a student or an apprentice, you may be able to claim Youth Allowance. There are income and asset tests which means that everyone will get a slightly different amount.

JobSeeker Payment

JobSeeker Payment is available if you're between 22 and the pension age while looking for work. Again, there are income and asset tests that determine how much you will receive.

Special Benefit

Special Benefit is an option that may be available for people who are not eligible for other types of income support. For example if you hold a temporary visa, haven't lived in Australia long enough, or you're an Australian resident under 16.

Pandemic Leave Disaster Payment

Finally, there is also a Pandemic Leave Disaster Payment which you can receive if you're directed to self-isolate or quarantine by a health official.

Residents of New South Wales, Queensland, South Australia, Tasmania, Victoria, or Western Australia may be eligible.

There are different requirements on how much you can get and how to claim, which depends on where you live.

You can't claim this type of payment if during your 14-day isolation period you get any income, salary, or earnings from paid work or any other income support payments.

Conclusion

Full-time babysitters and nannies who are paid legally are in the best position to collect unemployment if they're laid off. They are considered employees and pay into the system like any other worker.

Historically it has been difficult to get any kind of unemployment assistance if you're self-employed or working as a contractor.

However many countries are now offering extended unemployment benefits to self-employed people, including babysitters, as a result of COVID-19. It's unclear how long these benefits will be available, but you will want to take advantage of them if you find yourself in a position where you need them and you're eligible.