Global Resources is a full-service business development group and general management consulting firm that can help you access the knowledge necessary to achieve success.
We realize many small and medium – size businesses hire seasonal employees, especially during the holiday seasons. Although seasonal employees can be a great asset to a business, there are specific rules you must follow in order to abide by the laws. Below are five things you need to know if you hire seasonal workers:
1. You only worry about seasonal “workers” when you are determining if you are an Applicable Large Employer (ALE). ALE has over 100 full-time and full-time equivalent employees in 2015 and over 50 in 2016. If most of the time you are too small to be considered an ALE and only become an ALE because you hire extra workers for up to 120 days, then you can use the seasonal worker exception.
2. A seasonal “employee” is a defined term and not just someone you believe is “seasonal.” By definition, a seasonal employee is:
(a) hired into a position which typically lasts for six months or less; and
(b) the position must begin at about the same time each year (e.g. every summer or every winter.)
3. It does not matter how many hours a seasonal employee works during the season. If you are classifying employees as variable, you will have to offer them insurance next year if they work on average more than 30 hours per week this year. Alternatively, if your employees are truly seasonal (i.e. in a position that is six months or less) then no matter how many hours they work per week during the season, you will not be penalized if you do not offer them insurance.
4. In order to benefit from the seasonal employee rules, you must be using the look-back measurement method. When you use the look-back measurement method, you are required to classify your employees as full-time, part-time, variable or seasonal. You must be able to prove that the position you are categorizing as seasonal really is seasonal. For example, if your season has been more than 6 months for the past 5 years, you cannot all of a sudden claim it is less than 6 months this year for purposes of the Affordable Care Act (ACA).
5. If you do not have a reliable and accurate way of measuring and documenting seasonal employees, you must offer coverage to avoid penalties.
To learn more about us and / or to schedule your appointment with the business consultants at Global Resources LLC, call us at 855-338-0266.