If you have seasonal employees, there are employment laws that you must follow. Seasonal employment laws apply if you run a seasonal business or if you hire more employees during peak seasons. So, what are seasonal employment laws, and what do they mean for your business?
Read on to get the scoop on seasonal employment laws.
Seasonal employment laws
Seasonal employment laws are the same as the employment laws you must follow for permanent employees. Below are the seasonal labor laws you must follow.
Onboarding
When you hire a seasonal employee, you should follow your regular process for onboarding new employees. Onboarding will probably include orientation and job training. There are also some forms to fill out when your new employee starts.
Form W-4
All employees should fill out Form W-4 when they start a new job. Offer Form W-4 help to any employee who needs clarification.
You will use each employee’s Form W-4 to calculate and withhold federal income tax from their paycheck.
If your state has income tax withholding, employees might need to fill out a state W-4 form, too.
If you reemploy a seasonal employee each year, you should have them fill out a new Form W-4 every year.
Form I-9
As an employer, you must verify that all your employees are eligible to work in the U.S. You will use Form I-9 to check the identities and work authorizations of each new employee, including seasonal workers.
On the first section of the form, employees will verify that they are authorized to work in the U.S. Employees should fill out this section after they accept a job offer, but no later than the first day of work.
On the second section of the form, you will check employees’ identification documents. You must fill out this section within three days of the employee starting their first day of work.
FLSA seasonal employment laws
The Fair Labor Standards Act (FLSA) regulates labor laws for minimum wage, overtime, recordkeeping, and child labor. The FLSA applies labor laws for seasonal employees.
Minimum wage
Your seasonal employees should earn at least minimum wage. The federal minimum wage is $7.25 per hour. If you are in a state that has a higher minimum wage, you must pay your employees at least the state minimum wage.
Overtime
You must give overtime pay to nonexempt employees that work more than 40 hours in a workweek. The overtime pay rate is one and a half times the employee’s regular rate of pay.
Some states and localities have different overtime laws. Some places require double time pay. Some places also require overtime wages after an employee works a specific number of hours in a day. Check with your state to find out if they define overtime laws differently than federal laws.
Recordkeeping
The FLSA sets specific guidelines about how long to keep payroll records and employment documents.
Even though you might only have seasonal employees for a few months, you must keep payroll records for three years.
You should keep records related to seniority (e.g., evaluations, employee files, merit systems) for at least two years after the employee leaves.
Child labor
The FLSA includes child labor laws that protect workers under the age of 18. Child labor laws dictate the types of jobs children can do, the times children can work, how many hours children can work, and how much you should pay children.
Even if a child only works for you seasonally, you must still follow child labor laws.
Equal employment opportunity responsibilities
If you have at least 15 employees, you have federal equal employment opportunity responsibilities. You should treat all employees equally despite their race, color, religion, sex, national origin, age, disability, or genetic information.
Your responsibilities include fair employment decisions, policies, and internal pay equity. You should prevent and stop workplace harassment and discrimination. You should also make accommodations for employees, if reasonable.
Workers’ compensation
If you have employees, you must have workers’ compensation. This applies if you have seasonal employees too.
Workers’ compensation is insurance that pays for work-related injuries. If a seasonal employee is injured, the insurance will help pay for treatment, medical bills, and lost wages.
Misclassification
Make sure you understand the difference between an independent contractor vs. employee. You cannot say seasonal workers are independent contractors simply because they work for a short amount of time.
You can use the economic realities test to determine if a worker is an employee or an independent contractor. If you still are not sure how to classify a worker, you can submit Form SS-8 to the IRS. Form SS-8 requests a worker status determination.
Healthcare
The Affordable Care Act (ACA) requires you to offer your full-time employees health coverage if you have 50 or more full-time equivalent employees. When you calculate full-time equivalent employees, you only include employees who work 120 days or more for you during the year. This length of time will probably rule out many seasonal employees.
However, if you have seasonal employees who work 120 days or more, they might increase your full-time equivalents to 50 or more. If this happens, you must offer health insurance to your full-time employees.
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This article has been updated from its original publication date of May 16, 2016.
This is not intended as legal advice; for more information, please click here.