For the most part, you as the employer can set the definition for what constitutes a full-time or part-time employee at your company, along with what benefits full-time or part-time employees can participate in.
Simple time tracking that syncs with payroll.
The only time you can’t fully set your own definition is if you offer health insurance to full-time employees. If you offer health insurance to your employees, then you need to use the Affordable Care Act’s definition of full- and part-time employees.
According to the ACA:
- A full-time employee works an average of at least 30 hours per week or 130 hours per month for more than 120 days in a row.
- A part-time employee works an average of less than 30 hours per week or less than 130 hours per month for more than 120 days in a row.
The only other official federal definition of part-time and full-time employees comes from the Bureau of State Labor Statistics. Their definition is not a hard-and fast rule, but more a general guideline for reporting out labor statistics. According to that agency:
- A full-time employee works 35 hours or more per week.
- A part-time employee works 1-34 hours per week.
Below are even more on the difference between a full-time and part-time employees, broken down by different contexts, like health insurance and taxes. To help stay compliant, you can use a time tracking software to keep records of hours worked by each employee.
|Context||Full-Time Employee||Part-Time Employee||Why It’s Important|
|Employee Benefits||Receives full range of benefits||Can receive none, some, or all benefits, but it’s entirely up to the employer*||Benefits cost money but attract higher-quality employees. Employers need to walk the line between the two|
|Affordable Care ACT||Works an average of at least 30 hours per week for more than 120 days in a year||Work an average of less than 30 hours per week||Employers with 50 or more full-time and full-time equivalent (FTE) workers (when added together) are required to provide health insurance coverage to employees|
|Employee Handbook||Determined by employer||Determined by employer||By defining the difference between a part-time and full-time employee in your employee handbook, you can protect yourself from potential lawsuits|
|IRS Taxes||N/A||N/A||Whether an employee is full or part time, employers still need to withhold income and FICA taxes|
|Federal Fair Labor Standards Act (FLSA)||N/A||N/A||Leaves the definition of full and part time up to employers, but states that the FLSA still applies|
|Bureau of Labor Statistics||Works 35 hours or more per week||Works 1 to 34 hours per week||Only used for reporting purposes by the US government|
*This is not the case however if there’s a state law that requires an employer to provide certain benefits. For example, in Hawaii, if an employee works at least 20 hours a week an employer needs to provide certain benefits under the Hawaii Prepaid Health Care Law. For this reason, be sure to check your state’s Department of Labor website.
Can I make one employee full-time and another part-time if they do the same work?
Yes, you can make one employee full-time and another part-time even if they do the same work. However, doing so is risky as it can open your business up to potential discrimination lawsuits. Unless you have a solid reason, such as a request from the employee that’s documented with their signature, it might be best to avoid this practice.