As a small business owner, you may be considering part-time benefits for your employees. Offering benefits to employees who work fewer hours than a typical full-time workweek can help your staff feel more invested in their job, which can lead to more satisfaction and productivity.
Since part-time benefit requirements vary by state, you have some flexibility in which options to offer. In this article, we define part-time benefits and discuss how they can help your employees and your business. We also explain some standard part-time benefits and answer common questions.
What is part-time?
Part-time is a work schedule where employees work fewer than 30-40 hours per week, depending on the employer. Different governmental organizations have varying classifications for part-time vs. full-time work. For instance, the Bureau of Labor Statistics considers part-time at or below 35 hours per week, but the IRS classifies part-time at or below 30 hours.
Part-time hours are typically more flexible than full-time hours, which often leads individuals to have more than one part-time job. Many industries hire employees for part-time work, particularly in foodservice and retail.
What are part-time benefits?
Part-time benefits are often the same as those offered to full-time employees that they earn by working fewer hours. Companies typically reserve common benefits like health and dental insurance and retirement funding for full-time employees. However, you may still choose to offer some or all of these to part-time employees.
Common part-time benefits
In addition to flexible scheduling, you may choose to offer some of the following benefits to part-time employees:
Health, dental and vision insurance
You may offer one or more of these medical benefits to part-time employees. Health insurance typically covers doctor and hospital visits, prescription drugs, annual physical exams and more. With dental insurance, employees receive exams, common dental work like cleanings and extractions as well as repairs like crowns and bridges. Vision insurance usually covers exams, glasses and contacts, but it may also offer benefits for laser repair surgery.
Health insurance is typically the more expensive of these, with dental and vision coming in descending order of cost.
Many companies are invested in the intellectual growth of their employees and may offer financial help with college tuition. With tuition assistance, organizations pay for part of employees’ education while they’re in school. Many companies may also reimburse for tuition employees have already paid, either with direct payment to the employment or their student loan servicer.
Offering your employees stock options makes them partial owners of your business. By doing so, your staff may feel more committed to their productivity since the business’ success directly contributes to their earnings.
Paid time off
Paid time off can take a variety of forms, including a set number of days that employees can take for personal reasons in addition to designated vacation periods, or a set number of days that employees can use as they wish. When employees have this benefit, they may be likely to maintain a healthy work-life balance, which can help raise job satisfaction and work ethic.
Life insurance is a financial benefit that pays employees’ families upon the employee’s death. Employees will likely appreciate knowing their loved ones will receive a benefit in the unfortunate event of the employee’s passing.
Disability pays some or all of an employee’s lost wages in the event they are injured, ill or otherwise unable to work. This insurance differs from workman’s compensation in that it will pay benefits whether the employee is hurt on the job or not. These plans may cover short- or long-term disability or a combination of both.
Disability payments are classified as “own company,” which means the employee receives payment if they are unable to do their own job, or “any company,” which means the employee is not able to work at all.
Retirement plans, typically 401(k)s, are sources of funding after an employee retires from the workforce. The IRS sets maximum amounts of funds that employees may contribute. Employees under the age of 50 can contribute $19,500 per year, whereas employees older than 50 can contribute $26,500. If you choose to contribute to a retirement plan, you may consider matching some or part of the employee’s contribution. When employees know you’re invested in their post-employment lives, they may show more commitment to your organization.
FAQs about part-time benefits
Here are some common questions about offering benefits to part-time employees:
Do employees have to work at my company for a certain amount of time before receiving part-time benefits?
As with most issues related to part-time benefits, you have a great deal of flexibility with your requirements for earning benefits. Offering benefits to part-time employees immediately after hire can be an effective way to draw a large number of applicants to choose from, which may ensure you hire top talent.
However, requiring employees to stay on board for a certain length of time, say 90 days, could reduce turnover and ensure your employees are committed to your organization before you offer them benefits.
How can offering part-time benefits help my company?
The rationale for offering part-time benefits is much the same as offering them to full timers. It’s a way of rewarding hard work and helping employees maintain satisfaction in their roles and a commitment to being vital contributors to your company’s mission.
There are also practical benefits, since maintaining employees’ health will reduce absenteeism due to illness. Additionally, offering tuition assistance can educate staff members on topics pertaining to your business, which can help them advance in the ranks and provide you with consistent and reliable expertise.
If I offer tuition assistance, do employees have to go to a certain program or school?
This also depends on your personal preferences. If you’re an engineering company, it will be more practical to pay only for engineering certifications or advanced degrees in the field. However, if you want your employees to pursue their passions regardless of how they contribute to your company, consider paying for any educational experiences.
Some employers have special arrangements with certain schools, which may give the employers discounted tuition in exchange for sending their employees to those schools exclusively. Giving your employees their choice of school, however, could ensure they pick a program better suited to their intellectual and career objectives.