Benefit Considerations for Seasonal Employment

Many businesses rely on seasonal employment to help operations run smoothly during the holiday rush, summer peak, and harvest season. As these new employees are hired, a common question is asked: “What kind of benefits do we offer seasonal employees?”  

Balancing compliance rules, tight budgets, and the need to attract great talent for short-term roles can seem like an administrative nightmare. By understanding the common hurdles and adopting smart solutions, businesses can turn benefits for seasonal employees into a powerful tool for recruitment and retention.

Unique challenges of seasonal employment benefits

Hiring temporary staff can bring a specific set of challenges that may leave HR professionals feeling overwhelmed. From complex legal requirements to the constant turnover of employees, it is easy to get lost in what needs to be done.

Navigating compliance and eligibility

Staying in compliance is non-negotiable, and there is a fine line between seasonal and full-time.

• ACA guidelines: The Affordable Care Act (ACA) has specific requirements for businesses offering health coverage, and seasonal employees can impact their status. Tracking hours for employees and hiring patterns can be difficult when schedules change weekly, and many seasonal roles end before the standard waiting period for benefits concludes. However, staying diligent can help employers avoid unexpected penalties during ACA reporting.
• State mandates: On top of staying compliant with federal laws, many states have additional rules to follow. For example, some states mandate paid sick leave for all employees, including temporary and seasonal, while some do not. Keeping up with evolving local requirements can add another layer of complexity.

Managing costs effectively

Seasonal work, by definition, is temporary, and these roles sometime lead to higher costs that can strain employers’ budgets. A standard seasonal employment cycle involves initiating pre-peak recruitment, operating at maximum capacity during the peak season, reducing staff as demand decreases, and entering a transitional period to prepare for the next busy season. Each new hire means more paperwork and time spent on processes that are repeated over and over again.

A revolving door of employees can create a less-than-ideal risk pool for insurance carriers, potentially driving up premiums. Along with frequent enrollments and terminations, it can take a toll on HR systems, leading to potential costly errors for employers.

Recruitment and retention game

Finding reliable seasonal help can be a major challenge in today’s competitive job market. With higher expectations, benefits and perks are a deciding factor when job seekers decide which company to work for. Identifying seasonal employee needs demonstrates that employers value their staff and fosters loyalty that can pay off year after year.

Best practices for seasonal employment

With a proactive approach, employers can build a benefits program that is compliant, cost-effective, and attractive to top talent.

Look-back measurement method

Instead of trying to predict an employee’s hours in real-time, the ACA’s “Look-Back” measurement method can offer a more stable solution. This approach allows employers to determine an employee’s full-time status by looking back at the hours they worked over a defined period (the “measurement period”).

If an employee averages 30 or more hours per week during this period, they are considered full-time for a subsequent “stability period,” regardless of their hours during that time. This method smooths out the peaks and valleys of variable schedules, providing a clear and compliant way to identify who is eligible for health coverage. It simplifies administration and protects businesses from potential penalties.

Employee-paid voluntary benefits

Employers can offer a robust benefits package without adding to their bottom line. Voluntary benefits that are 100% employee–paid give seasonal employees access to valuable coverage at affordable group rates.

Options to consider are:

• Dental and Vision: Highly sought-after benefits that employees understand and value
• Accident and Hospital Indemnity Insurance: These plans provide cash payments to help cover out-of-pocket expenses associated with injuries or hospital stays.

By providing access to certain plans, employees have the power to choose coverages that best fit their needs and budget.

Enticing perks

Non-traditional perks are often easier to administer for a short-term workforce and can be just as effective in boosting morale and retention.

Perks to consider are:

• Telehealth Services: Offering 24/7 access to virtual doctor visits is a convenient and low-cost way to provide healthcare support. It’s especially appealing to those who may not have a primary care physician.
• Employee Assistance Programs (EAPs): Provide confidential access to resources for mental health, financial wellness, and legal advice.
• Retail Discount Programs: Partner with services that offer employee discounts on everything from groceries to movie tickets.

These perks can be easily turned on and off for employees, making them a perfect fit for seasonal employment.

Streamline processes with technology

Modern technology platforms are essential for managing seasonal benefits efficiently and accurately. Solutions like Employee Navigator automate the entire lifecycle of an employee’s benefits.

These platforms allow for:

• Quick and Easy Enrollments: New hires can review their options and sign up for benefits online in minutes, without needing to fill out stacks of paperwork.
• Seamless Terminations: When the season ends, employers can process terminations in the system with just a few clicks, ensuring coverage ends correctly and no ineligible employees are being paid for.
• Improved Compliance: Technology helps maintain accurate records for ACA reporting and ensures all necessary documentation is stored securely in one place.

By leveraging technology, HR teams are free to focus on more strategic initiatives instead of getting bogged down in administrative tasks.

Key takeaways for seasonal employment

Through implementing smart strategies such as the look-back measurement method, offering a mix of voluntary benefits and modern perks, and leveraging technology, employers can create a seasonal employment program that is both compliant and compelling. Businesses can confidently face the busy season, knowing they have a happy, supported, and loyal team ready to help them succeed.

At The Miller Group, we specialize in helping employers design benefit programs that strike the right balance between cost control and company culture. Whether you’re fully insured, self-funded, or somewhere in between, contact one of our advisors to create a plan that fits your needs.