Announcement

Collapse
No announcement yet.

Part time/Short term employees California

Collapse
This topic is closed.
X
X
  • Filter
  • Time
  • Show
Clear All
new posts

  • Part time/Short term employees California

    We are hiring part time/short term employees and wanted to know begin discussions regarding offering benefits and PTO allowances. In the past part time short term employees (5-6 month employment) were not offered benefits, even if they met the corporate policy of working 30 hours per week and not PTO time. I have concerns that we are treating these otherwise part time employees differently due to the length of their employment. What are your thoughts?

  • #2
    I would be careful with trying to treat all "benefits" the same. This is an oversimplification but legally there are two classes of benefits.
    - Certain types of benefits (retirement plans including 401(k), medical plans) fall under a federal law called ERISA. The feds do not care if benefits are offered but if these classes of benefits are offered, then the employer must have a published benefit plan and the employer MUST follow the exact language of the plan. ERISA has some really horrific penalties associated with violating the rules. So, IF when you are talking about "benefits", you are talking about an ERISA-level benefit, then your answer is to ask to see a copy of the plan, sometimes called a Summary Plan Document. The employer is required by law to make the SPD for ERISA-level benefit available to employees on demand.
    - Then there is everything else. Say vacation. Now vacation could be made into an ERISA-level benefit by funding it through an outside trustee, but this is not only rare, but it is something no sane employer would voluntarily do. So a good rule of thumb is that any benefit which does not have to be ERISA-level probably is not. What is left is state law (if any) and company policy. A company policy may rise to the level of a legally enforceable contract, but this is not normally true. While all contracts are agreements, not all agreements are contracts. My last two employers had in house Legal departments who made very sure that no company policies or offer letters crossed the enforceable contract line. Still, you can always have a local attorney review your employer's policies to see if any of the policies are legally enforceable. Past that, state law can do things. In CA for example, vacation is legally vested. Employers do not have to offer vacation and excluding part time employees could be very legal if done correctly. However once vacation is earned, it cannot be forfeited in CA.
    "Reality is that which, when you stop believing in it, doesn't go away".
    Philip K. **** (1928-1982)

    Comment


    • #3
      Thank you for your thoughtful response. Our employment contracts/offer letters spell out whether new hire is to expect PTO and/or health benefits.

      If I am understading your explanation correctly, we can exclude PTO to part time casual or temporary new hires if we define them as such in their offer letter.

      As for health benefits, if they meet the minimum amount of hours eligibility under company policy, then they must be offered to them.

      Comment


      • #4
        Originally posted by hrhelp View Post
        As for health benefits, if they meet the minimum amount of hours eligibility under company policy, then they must be offered to them.
        It's actually the plan rules.
        I don't respond to Private Messages unless the moderator specifically refers you to me for that purpose. Thank you.

        Comment


        • #5
          And don't forget to check your eligibility under your 401k plan. Many employers think they don't have to cover temps, but check your plan documents/plan administrator to be sure. And even some temps become eligible if they work enough hours (need to also see how the plan calculates hours worked for eligibility purposes).

          There is almost nothing worse that realizing you left out a whole group of eligible employees and having to go back and fund accounts with employers' money for temp employees as if they had all chosen to participate (Both employee deferrals and match).

          Comment


          • #6
            Agreed with the other answers. If you are talking about 401(k) or medical plan, READ THE PLAN RULES!!!! Stop writing offer letters until this is done. There is nothing what-so-ever that an offer letter can do to alter the plan rules.

            At best, an offer letter or a company policy involves crosses the enforceable contract line, and to find out if that is true, you need to have a local attorney read the actual wording of the offer letter or company policy. But even if the offer letter or company policy rises to the level of an enforceable contract, this would in no way alter the employers requirement to compile with the ERISA law.

            Any employer who chooses to offer 401(k), medical plan or other ERISA level benefit must read and follow the SPD rules associated with the plan. And if the employer has staff issuing offer letters that fail to compile with the SPD rules, those staff need to be trained or fired ASAP.

            I worked for a company in the 1980s who got hit with a $250K penalty on their 401(k) for some minor technical violations mostly involving part time or temporary employees. Not surprisingly, basically the entire H/R department was fired shortly after this.
            Last edited by DAW; 08-14-2009, 11:21 AM.
            "Reality is that which, when you stop believing in it, doesn't go away".
            Philip K. **** (1928-1982)

            Comment


            • #7
              Agree wholeheartedly with hr for me. A former employer had to go back and offer 401k participation to agency temps who had been gone for a year or more, because their plan document was badly worded. It was caught in the standard audit. Thankfully most of it happened before I got there and I only dealt with a bit of the backlash, but it was not fun at all.
              The above answer, whatever it is, assumes that no legally binding and enforceable contract or CBA says otherwise. If it does, then the terms of the contract or CBA apply.

              Comment


              • #8
                A lot of good info has been posted here. The ramifications of all of this cost the company money in many ways. Do an honest cost analysis carefully. In my company, for temp employees, we usually opted to go to a temp agency to actually hire them - even in cases where we interviewed and picked the employees. It solves a lot of problems. And, if you work with a minority-owned temp agency, it can help you meet your EEO targets if you are in a business that has them.
                Please post questions on the forum rather than sending me a private message or email. That way others who have similar issues have access to the discussion.

                Comment

                Working...
                X