Having a live-in nanny was probably one of the best decisions we made after we moved here. Both of us travel quite a bit and after my wife got a high fever while I was in the US, we decided to get some outside help. Nannies are called "canguros" here in case you get confused.
Many more upscale places in Spain come with a handy "service area" where your kangaroo can live. In many cases, you spend a bit more on rent, but you save quite a bit by providing free housing as part of the deal. It's nice to be able to go for a drink with worrying about getting a babysitter.
Our first nanny decided to abscond back to south america with no notice after convincing my wife to sign some papers that would allow her to come back to Spain legally. What was supposed to take a week ended up taking two month, after which time we had already hired someone else. We were still on the hook to pay social security for 6 months. Lesson learned.
Unlike everyone else we know, we actually treat our nanny pretty well, providing a christmas/summer bonus, vacation, and pay her about 800 euros/month (which apparently is outrageously high). People here in Catalonia pride themselves in paying as little as possible to their nannies, which is kind of silly when you think about how much impact they have on your kids lives.
We know one family that has a giant mansion nearby (it takes up the whole city block with tennis courts, etc. Argentineans in the "import" business.. uh huh ), who was saying that she pays her nanny 600 euros a month for working for 8am-10pm every day, and was especially proud of the fact that she forbids her from eating anything while on duty.
The conclusion is that our family wouldn't do very well in the sweatshop-owning business.