For many small businesses, hiring temps is the perfect solution during seasonal upswings (the holidays are right around the corner!) or when extra help is needed because someone is out on maternity or disability leave. Or perhaps you’re looking to fill a recently vacated position but want to “test the waters” first: A temporary worker can be offered a full-time position if you’re happy with his or her performance after a certain period of time.
While there are many advantages to hiring temps, there are precautions to consider, as well. Keep the following in mind when hiring temporary workers:
Temporary employment involves a set period of time, such as days, weeks, months, the duration of a special project or the length of time a permanent employee is out. Generally speaking, an employee is either full-time or part-time, regardless of temporary status. This matters because certain federal and state employment laws apply to employers based on the number of employees – and may or may not count temps in the total.
When you work with a staffing agency, the agency is responsible for recruiting, screening, testing and hiring workers; handling timekeeping, payroll and related taxes; and providing unemployment and workers’ compensation insurance. If you decide to use an outside agency, you’ll typically pay a fee that includes the candidate’s hourly rate and the agency’s markup to cover the above services.
Even if the agency oversees the above services, you are considered the temp’s co-employer. As such, you need to be mindful of workplace issues like safety, preventing discrimination and harassment, and wage and hour compliance under the Fair Labor Standards Act (FLSA).
If you hire the temp directly, you will need the individual to fill out an I-9 form and provide the appropriate documentation verifying his or her eligibility to work in the United States. The temp also must fill out a W4 so you can process the correct withholdings for payroll.
At the very beginning of the temp relationship, specify the pay rate, pay period, pay day, eligibility for benefits (if any) and length of employment. Remember that if a temporary, non-exempt employee works more than 40 hours in a workweek, he or she is entitled to overtime pay for those hours.
You are not required to provide paid time off (vacation, sick or personal days) to temporary employees. You don’t have to extend health insurance either. Many employers consider this a significant cost savings - and benefit - to hiring temps.
Whether you’re working with an agency or hiring a temp on your own, it’s important to explain the job, the skills needed and your basic expectations. Take the time upfront to work through these details to ensure a good fit and avoid problems down the road.
This should go without question, but always treat your temp workers with the same respect and care you do your permanent staff. Tammy is not “just a temp,” but an important part of your workforce, if even for a short amount of time.