Part-time employees play an important role in the workplace for thousands of employers. There is no legal or formal permanent part-time work definition. Most people would agree that part time means something less than 40 hours per week, but determining what is considered part time is left up to the employer. Some federal laws do set hours-worked requirements as an eligibility criterion for specific programs. It is important for employers to know how these laws work so they can make an informed decision about what full-time and part-time work should mean for their organizations. The lack of a precise part-time work definition should not cause an employer to ignore this issue.
Permanent Part-Time Work Definition
The phrase "permanent part time" combines two distinct concepts for classifying employees in the workplace. "Permanent" means that there is no explicit or implied time limit to an individual's length of employment. For instance, the employee is not working under a contract with an expiration date. A contractual employee may either have his contract rescinded or have to leave if his contract was not renewed.
There is no federal statute that provides a full-time employment definition or that defines part-time work. The provisions of the Fair Labor Standards Act apply to protected employees and leave the matter up to employers. Some organizations set policies that establish a part-time work definition or negotiate the meaning of part time with worker representatives. According to the FLSA, all employees must be paid at least the federal minimum wage, regardless of the number of hours worked. Overtime rules also apply. Suppose a worker usually works 20 hours per week and is considered part time. One week, this employee works 48 hours. She must be paid at least1.5 times her regular hourly rate for hours worked more than 40 even if she returns to her usual 20-hour schedule the following week.
Sometimes employers allow or encourage job sharing. In a job-sharing arrangement, two or more employees "split" a single job. For example, two administrative assistants might each work 20 hours per week to fill a single full-time position. Employers have found that job sharing can improve recruitment and retention of workers, as well as boosting productivity and morale. However, the provisions of the FLSA apply to each worker in a job-sharing arrangement separately, irrespective of their job duties.
Statutory Benefits for Part-Time Work
It is often the case that employers offer certain benefits to full-time employees, but not to those considered part time. However, an employer is legally required to provide some benefits. Matching Social Security contributions and workers compensation are two examples. States set eligibility criteria for unemployment insurance, and in many cases, a part-time worker will work enough hours and earn enough money to qualify. Some states require additional benefits such as short-term disability insurance.
Part-Time Employment and the FMLA
The possibility that a worker may need time off for medical reasons should be considered when an employer must classify an individual as part or full time. The Family and Medical Leave Act of 1993 protects the job of an employee who must take time off because he is ill or must care for a sick family member. FMLA may also be used to provide an adjustment period after a birth or adoption. Employees may be eligible if they have been on the job for a year and have worked at least 1,250 hours in the previous 12 months. This works out to about 24 hours per week, which is often considered part time. FMLA leave is unpaid and can total up to 12 weeks per year. Job-related health care coverage must continue during FMLA leave. Businesses who have at least 50 employees who work within 75 miles of the employer's location must offer FMLA leave. In addition, public employees and teachers employed by public or private schools are covered by the FMLA. Employers may require that a health professional certify that an employee needs time off before granting a leave request.
Part Time Under the ACA
The Affordable Care Act of 2010, also known as Obamacare, guarantees access to affordable health insurance coverage for Americans. It is important for employers to know their obligations under the ACA because the Internal Revenue Service will impose penalties for noncompliance. The ACA divides employers into two categories. Small employers, meaning those with fewer than 50 full-time employees, are not required to offer a health care plan under the ACA. Applicable Large Employers, or ALEs, must offer a health care plan that provides essential coverage that is affordable for full-time employees. The ACA defines a full-time worker as one who works an average of 30 hours per week or more or who works an average of 130 hours or more each month. Part-time employees, meaning those who average less than 30 hours per week, may be eligible for health insurance coverage. Whether this is the case or not depends on state laws and insurance provider policies. For example, an insurer might agree to include part-time workers who work 20 hours or more each week, even though the ACA does not require it. Employers should check with their insurance provider to find out what options are available.
Retirement Plans for Part-Time Employees
The Employee Retirement Income Security Act of 1974 is another federal law that uses the number of hours worked to define eligibility. ERISA is designed to establish standards for retirement plans offered by businesses. For example, if a business offers a 401(k) retirement savings plan, participation criteria must comply with ERISA guidelines. In general, ERISA and IRS rules allow employers to exclude employees who work fewer than 1,000 hours per year or about 19 hours a week on average. These part-time workers can be included if they meet other plan-eligibility criteria, but the business and plan provider is not obligated to do so.
Part Time and Other Benefits
Employers often offer several other benefits to full-time and part-time workers. Paid sick leave and paid vacation time are two examples. Some employers also pay shift differentials for night work or offer premium pay for working on weekends and holidays. The FLSA does not require any of these benefits, so it is up to the employer to decide whether or not to provide them. However, some or all of these benefits may be required by an employment contract or collective bargaining agreement which may set a minimum number of hours worked as a criterion for receiving them. Also, some state and local governments require some or all of these benefits for full-and/or-part-time employees, so employers should check the rules that apply where they are located.
Advantages and Disadvantages of Part-Time Workers
The judicious use of part-time labor can be a godsend for a business, particularly a small one. The workload for many firms is not constant. For example, a restaurant or retail store has periodic "rushes" alternating with times when customer traffic is light. Managers can organize work schedules based on expected busy periods. By bringing in part-time workers to provide extra help when needed ensures the overall operation runs smoothly. There will be enough people on hand to provide quality customer service, which in turn is likely to result in more satisfied customers and increased business.
Permanent part-time workers are well-suited to fill in gaps in a business's work schedule. Even the most reliable employees may be absent occasionally due to illness, a summons to jury duty or some other reason. At the same time, some part-time employees will be willing to work extra hours on short notice. In many situations, this is a better solution than calling a temp worker from an agency who is unfamiliar with the business operation. Sometimes a company will need a particular skill, but not often enough to justify hiring a full-time specialist. In this situation, recruiting a permanent part-timer with the requisite skills may be a cost-effective option.
Incorporating permanent part-time employees in a workforce can be a good strategy for controlling labor costs. This is especially true when it comes to benefits. For example, the ACA requires that Applicable Large Employers make health insurance available to employees who work more than 30 hours per week on average. However, this benefit is not required for part-time workers. It is frequently possible to recruit part-time employees without having to offer as many benefits as would be necessary to attract qualified full-time employees. Finally, the ability to schedule part-time people only when needed avoids situations where workers are "on the clock" at times when their services are not required to have them available when they are needed.
On the other hand, hiring part-time employees can create difficulties for an employer. Like any other new hire, a part-time employee requires orientation and training to fit in well in the workplace. Also, part-time workers are frequently absent for several days at a time. Managers need to establish clear procedures to ensure that a worker returning after an absence is informed about the status of current projects and of any changes that have taken place.
A part-time employee may also be subject to role conflict. She may be a student or have a full-time job. These other roles may be of more importance to the part-timer and lead to divided loyalties, a lack of commitment or simple fatigue and lack of energy.
Why People Choose Part-Time Work
To recruit and retain qualified permanent part-time employees, managers must understand the reasons some people prefer a limited work schedule. Understanding what motivates these individuals will help in making choices about hiring, training and compensating them. One common reason for someone to seek a part-time position is to have more time for other activities. For example, high school and college students usually prefer part-time jobs because their priority is completing their educations. A person who is nearing retirement age may choose an early exit from his career position, but wish to remain actively working on a limited basis. Some people are engaged in a special project that precludes full-time work. One instance of this scenario is the athlete who chooses part-time work so he can devote time to training.
Of course, one motive for taking part-time work is to earn extra money. People take this path for a variety of reasons. Some just want extra spending money. Others want to save for a long-term project such as purchasing a home, funding a child's education or putting money into a retirement fund.
One source of motivated part-time employees are people who are seeking career growth. For example, a college student may look for a part-time job or paid internship in her chosen field. Recruiting these individuals can be a good move because they are likely to make a strong effort to learn and perform well to get a head start on their careers.