Hiring part-time workers can have downsides
Hiring a part-time worker can be a money saver for a small business, whether the company is growing or shrinking, but experts warn that the choice comes with possible downsides.
An unwary business could wind up facing an expensive legal battle if it runs afoul of federal or state labor laws, which generally apply to part-timers as well as full-time workers.
“I am getting more calls from small-business owners who are getting hauled into court or being audited by some agency because they are being accused of violating laws they didn’t even know applied to them,” said Teresa Tracy, a labor attorney in Marina del Rey.
Too often, she said, part-time workers are not considered regular employees by their employers. Small businesses, especially, often lack the human resource expertise needed to follow the myriad rules and requirements that come with having even a single part-time employee.
Part-timers qualify for overtime, and meal and rest break rules might apply to them. In California, which has a daily overtime rule, even an employee who comes in one day a week could be due overtime if he or she works more than eight hours in one day.
Some benefits, including certain retirement plans or leave laws such as the federal Family Medical Leave Act, can be triggered if a worker exceeds a certain number of hours in a year, regardless of the employee’s part-time status.
Even a single part-time employee must be covered by workers’ compensation insurance, and minimum-wage laws must be followed.
Bringing a part-time worker aboard might bump up a business’ status with regard to employment laws. For example, if adding a part-time worker boosts the workforce from four to five, the business might have to comply with California’s workplace disability rules.
If a small business expects to add part-time workers, it’s important for the owner to learn the rules that apply ahead of time and put the proper procedures in place, said Kimberly Nwamanna, a senior consultant and training specialist at Employers Group, a Los Angeles-based human resources consulting firm.
“Small businesses usually don’t have the infrastructure and internal bureaucracy that keeps you out of trouble,” Nwamanna said. “And a lot of them are trying to grow from a mom-and-pop but still have that mentality that ‘We are all family, and the employees will not harm us, they love us.’ ”
Benefits policies for part-timers should be decided ahead of time and put in writing.
If you’re confused about the rules regarding part-time workers or the true cost of bringing them aboard, consultants in the human resources field can help sort things out.
More and more businesses will probably be faced with this situation as time goes on — using part-time help is on the upswing.
The share of involuntary part-time workers more than doubled to 6.2% of the U.S. workforce in September compared with 3% three years earlier, according to the U.S. Bureau of Labor Statistics.