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Do Part-Time Employees Get Benefits?

If you hire part-time employees to supplement your full-time staffers, you may be wondering whether you need to offer them health insurance. While the Affordable Care Act includes part-time workers into their calculation for whether companies are required to offer health insurance to their employees, it doesn’t mandate that these employees be offered such insurance.

Answering whether part-time employees get benefits or not isn’t as straightforward as you might think. Below, we’ll dive deeper into some of the factors that go into it, as well as how your company can stand out among the competition when it comes to attracting part-time employees.

What is a Part-Time Employee?

According to the Fair Labor Standards Act, an employee is considered to be part-time if they work less than a full-time worker. That’s incredibly simple and vague, of course, but does show that employers usually are allowed to determine on their own what constitutes a full-time and part-time worker.

The U.S. Bureau of Labor Statistics says that part-time employees work up to 34 hours each week. Through the Affordable Care Act, the IRS states that any person who works at least 30 hours each week or 130 hours each month is considered to be full-time.

How Does the ACA Handle Part-Time Employees?

As mentioned before, the ACA doesn’t mandate whether part-time employees are offered health insurance. It does, however, factor part-time employees into the full-time equivalent (FTE) calculations to determine whether an employer is required by law to offer health insurance to their employees.

All employers who have at least 50 FTE employees are considered to be an applicable large employer (ALE) and must, as a result, offer affordable health coverage to their employees, per the ACA’s guidelines. Therefore, if your company has enough part-time workers, it could tilt the scales and require you to offer health insurance to your full-time employees.

What Benefits Do You Have to Offer Part-Time Workers?

While you are not required to offer part-time workers health insurance, even if you are deemed to be an ALE, there are some benefits that you must offer all workers.

This includes unemployment and workers’ compensation. The former provides payments to workers who are laid off, and their payment depends on how much they worked, their wages and what state they’re in. The latter provides protection should an employee be hurt on the job and require time away from work and/or medical expenses and rehabilitation as a result.

Any employee who works at least 1,000 hours in a year at the same company must be offered the chance to participate in a retirement plan, should the company offer one. This is mandated through the Employee Retirement Income Security Act.

Any part-time employee who works 500 hours each year for three years in a row also must be offered the chance to participate in the company’s 401(k) plan, per the Setting Every Community Up for Retirement Enhancement Act. Employers are not required to match any contributions part-time employees make to the plans, though, even if they do so for their full-time workers.

All employees who work more than 40 hours in a week and are considered non-exempt must be offered overtime pay at 1.5 times their normal pay rate. In some states, these overtime wages and rules might be more stringent.

Should You Offer Part-Time Workers Benefits?

While part-time workers obviously don’t work as much as full-time workers, they still fill vital roles in your company. In fact, they are key pieces to the puzzle and help your company succeed every day.

As such, it’s important that if you need part-time workers, you are hiring the best and brightest that you can. One way to attract these workers to your company is by offering them certain benefits. This can be a key differentiating factor between your company and the competition, as many part-time employees will never receive benefits.

The most common one is health insurance. Medical benefits are a great recruitment tool to attract part-time workers, as it shows them you care about their health and that of their families. You can also offer participation in retirement plans to show you care about them long-term.

You could also offer other fringe benefits such as paid time off, a flexible schedule and assistance with tuition. The great part about all these benefits is you aren’t hamstrung when it comes to what you have to offer. You can pick and choose what works for you and what you feel will attract the best part-time workers to your company.

Know the Ins and Outs of Part-Time Workers with Beckham Insurance Group

If you have part-time workers on your staff, you might be wondering what benefits you’re required to offer, and which ones would be the best at helping you stand out from your competition.

In the Georgia and South Carolina region, the best way to figure this out is to work with Beckham Insurance Group. Our experienced professionals have years of experience working with companies just like yours, and can help advise you on what you’re required to do and what you could do to attract great part-time workers.

To find out more, contact us today.