The laws regarding employee benefits for part-time employees can vary widely from state to state, and there are some differences from federal law as well. Many benefits that are mandatory for full- or part-time workers in other states are not required in Michigan.
It's important for companies to have a knowledgeable HR solution to make sure they stay in compliance with all benefit regulations. Here are some things you should know when it comes to your rights and responsibilities when it comes to part-time employees.
Part-Time Employees vs. Full-Time
Many states, including Michigan, do not make a distinction between part-time and full-time employees in terms of the number of hours worked. If any employee works more than 40 hours a week, Michigan requires that they be paid time and a half for those excess hours. If state or federal law requires a benefit be provided to "full-time employees," then that benefit must be provided to all employees in Michigan, including part-timers.
Optional Benefits in Michigan
There are many benefits that are optional for employers to provide in Michigan. For example, a Michigan employer is not legally obligated to provide any of the following to full-time or part-time workers:
- Paid or unpaid vacation leave
- Paid or unpaid sick leave
- Paid or unpaid holiday leave
- Paid or unpaid jury duty leave
- Paid or unpaid voting leave
Even though these benefits are not required, many Michigan employers choose to provide them to workers. Paid or unpaid leave can be important to employees for their work-life balance. It can also keep you competitive in the marketplace and help with employee retention if you provide paid or unpaid leave.
Required Employee Benefits
Workers' Compensation: All employees, whether they're full- or part-time, are entitled to workers' comp. If they are injured at work, this entitles them to medical expenses, rehab and possibly a portion of their lost wages. These benefits are paid through your workers' comp insurance policy.
Retirement Benefits: If an employee works for 1,000 hours per year for you, it becomes mandatory to offer them to participate in your retirement savings plan. If an employee works 500 hours per year for three years in a row, the same applies. Matching employer contributions are not required for part-timers, however.
Overtime Pay: As mentioned above, any employee who happens to work more than 40 hours per week is entitled to time and a half wages for the excess hours worked.
Health Insurance: The Affordable Care Act does not require you to provide health insurance to part-timers. However, part-time employees can factor into your full-time employee calculations. For example, if you have 40 full-time employees and 20 part-timers who each work 20 hours a week, the part-timers count as an additional 10 workers. This would put you at the threshold of 50 full-time employees, which then requires you to provide health insurance to your 40 full-timers.
Family and Medical Leave: Any employee who has worked for you for at least one year and 1,250 hours is entitled to 12 weeks of unpaid, job-protected time off work under the Family Medical Leave Act. It's uncommon for part-time employees to meet that threshold of hours, but it does happen occasionally.
Advantages of Benefits for Part-Time Workers
In most cases, the benefits provided to part-workers are at the discretion of the company they work for. However, there are some good advantages to providing part-time benefits. While the cost may seem high, providing benefits to part-timers will often pay for itself. You should consider the following advantages to offering benefits to your part-time workers:
- Makes employment more attractive with you than with competitors
- Allows you to recruit more talented employees
- Reduced turnover and helps dramatically with retention
- Improves employee productivity
Fringe Benefits for Part-Time Employees
Aside from traditional benefits, you may want to consider certain fringe benefits for part-time workers. These are certainly not required benefits, but they can be a nice perk that helps you attract and retain talent. Some outside-the-box examples of fringe benefits might be accrued personal or sick days, a gym membership, a tuition reimbursement plan, or tickets to sporting events.
It's important to stay in compliance with HR laws and benefit regulations, no matter how large or small your company is. Workforce PayHub offers comprehensive HR solutions that can be tailor-made to fit your needs in this area. Contact us to request a demo and learn how we can help you manage employee benefits for part-time employees.
