In the past, conventional thinking held that benefits should only be available to full time employees, and not to part time employees. And the obvious reason for this was to save money. After all, why spend tens or hundreds of thousands of dollars providing benefits to part time employees when it wasn’t necessary?
Well, here we are in 2015, and in most industries and marketplaces, this conventional thinking is starkly out-of-date. The ongoing “war for talent” certainly includes part time employees; the best of whom are recruited by top performing businesses.
What’s more, whereas in the past it was generally viewed that part time employees were, to put it bluntly, forced into a part time situation because they couldn’t find a full time job, things are very different today. Often, part time employees choose that status because it fits their lifestyle (i.e. they may be going to school part time, spending time with their kids, and so on). This is just another reason why the pool of part time employees today is full of high achievers and top performers – i.e. the exact people that businesses like yours need to succeed and grow.
In terms of benefits, 39% of part-time employees had access to retirement benefits in 2015. Paid holidays were provided to 90 percent of full-time and 37 percent of part-time workers in private industry. In state and local government, 74 percent of full-time workers and 30 percent of part-time workers were given paid holidays. So what can you be offering to compete with big businesses who are offering benefits like these?
Other Factors to Consider
Aside from the major reason to offer benefits to part time employees – which, again, is attracting and retaining top part time talent rather than losing them to the competition – there are other factors to consider, including:
- Avoid Health Care Assessments
Various legislation -- including the Patient Protection and Affordable Care Act -- requires that organizations offer appropriate health benefits to all employees when their staffing contingent equals 50 full time employees; even if some of those employees are part time employees.
For example, if you have 40 full time employees and 20 part time employees, and your part time employees carry out the work of 10 full time employees, then your organization meets the 50 full time employee threshold. As such, you definitely want to provide adequate benefits to your part time employees, rather than be forced to do so after a health care assessment.
- Tax Advantages
The benefits you offer part time employees (just as with your full time employees) entitle your organization to a tax deduction, which can lower or offset your monthly, quarterly or annual tax bill. Obviously you should speak to your accountant about this, but he or she will likely confirm – and quite happily – that every $1 you offer your part time employees in benefits won’t actually cost your organization a full $1 out-of-pocket.
A Final Piece of Advice
If you’re planning on offering benefits to your part time employees so that you can win the war for talent, avoid health care assessments, and enjoy some tax relief, then we have some final advice: ensure that your HR and benefits software supports part time employees! Otherwise, your gains will be offset -- or perhaps even eclipsed -- by the added administration costs.
At Connected Benefits, we can take care benefits for BOTH your full and part time employees, as well as group plans and individual coverage. Regardless of the size or composition of your workforce – or how it may change in the future – we put all of the information you need in one centralized location, so that it’s easy and efficient to manage.
Learn more about our acclaimed HR and benefits software by scheduling your free 30-minute demo. Click here to get started.