One question that comes up with some regularity is, “How many hours does an employee have to work to be a full-time employee?” Unfortunately, the answer to the question is, “It depends.”
Full-time employment is a term with many different definitions, each depending on both the factual and legal context in which it is used.
Below, we discuss various situations in which the term “full-time employee” may be used and what it may mean in each situation.
Employer-Defined Full-Time Employees
In a large number of instances, when the questions about full-time employment are asked, the person asking wants to know if an employer is legally obligated to provide some kind of fringe benefit. This includes health insurance, vacation leave, sick leave, retirement benefit, and more.
Frequently, employers only offer such benefits to full-time employees. Employees who do not qualify for the fringe benefits want to make sure their employers are not unfairly denying them those benefits.
In most situations where the employer voluntarily provides fringe benefits, the definition of a full-time employee is determined at the sole discretion of the employer. Employees who do not meet the employer’s definition of full-time employees will not have a legal claim to receive the benefits.
Therefore, if an employer says that an employee must work at least 32 hours per week to qualify as a full-time employee and receive fringe benefits, a full-time employee for that employer is an employee who works at least 32 hours per week.
For purposes of voluntary fringe benefits, the employer determines when an employee is full-time and when they are not.
Employers are given this leeway in determining how many hours constitute full-time employment for purposes of voluntary fringe benefits because employers are not obligated to provide them to any employee, whether one is a full-time or part-time employee.
Employers are generally not required to provide employees retirement benefits, paid vacation, sick, holiday, or personal leave, or other similar benefits (See US DOL: Wage and Hour FAQs).
Thus, when employers choose to provide such fringe benefits, they also get to decide how many hours an employee must work in a week, or other designated period, before they become eligible for those benefits.
Moreover, employers may set different hour thresholds for different levels of benefits, granting partial benefits to those with part-time employment while granting greater benefits to full-time employees.
Full-Time Employees, Laws, and Minimum Hours Worked Requirements
Some laws require employers to provide benefits to employees.
Typically, these laws require employees to work a minimum number of hours before they become eligible for the legally-required benefit.
However, the term “full-time worker” is not always used to describe those employees who qualify for the benefits.
Moreover, laws may have different minimum work hour requirements before an employee is eligible for coverage.
Three examples of these types of laws are the Fair Labor Standards Act, the Family and Medical Leave Act, and the Affordable Care Act.
Fair Labor Standards Act (FLSA), and similar state laws, are largely responsible for creating the notion that an employee who works 40 hours per week is a full-time employee.
This notion stems from the fact that employees, unless otherwise exempt, must be paid overtime for all hours they work in excess of 40 hours in a workweek.
The fact of the matter is that, although the FLSA sets the minimum threshold for overtime, employers may offer more generous overtime benefits, such as overtime after 32 hours.
Thus, employers voluntarily shift the concept of a full-time employee to a lower threshold than 40 hours per week for the purposes of overtime and their FLSA compliance.
Family and Medical Leave Act (FMLA) is a federal law that requires employers with 50 or more employees to provide employees with up to 12 weeks of unpaid leave due to their own or a close family member’s serious health condition.
To qualify for FMLA leave, an employee must have worked for the employer for at least 1,250 hours during the 12 months immediately before the date the FMLA leave begins.
This 1,250-hour annual requirement breaks down to be approximately 24 hours per week.
Thus, it could be said that full-time employment for purposes of the FMLA is at least 24 hours per week.
However, the term “eligible employee,” not full-time employee, is used to describe employees who meet FMLA’s minimum hours threshold.
Full-Time Employee Definition FAQs
Below are other FAQs we prepared to help shed more light on this topic.
1. Based on federal definition, who is the “employee”?
American federal law defines an employee as someone who works for another with the expectation of gaining financial compensation or other forms of payment.
However, what differentiates independent contractors from employees is the amount of pay received through services rendered.
2. Regardless of employee definition, what are the particular rights of employees when it comes to getting retirement plans from employers?
Any employee who is an active retirement plan participant must be aware of their rights. These rights are part of the Employee Retirement Income Security Act (ERISA).
Part of these rights is the employer’s responsibility to disclose all crucial information of the plan, including a fair and timely process of claims when the need arises.
Equally crucial is the knowledge of employees on how to make these benefits work for them and their families.
3. Despite how full-time and part-time employment definition changes according to context, what must employers guarantee?
Even if the Fair Labor Standards Act (FLSA) does not provide clear definitions and employers may identify their own, employers should still exercise great care in avoiding misclassification.
This is in line with the Affordable Care Act (ACA), aligned with the IRS, which determines that full-time employees render an average of at least 130 hours per month.
If an employer misclassifies its workers, penalties may be imposed upon the employer.
4. In the US labor context, who are small employers (SE) and who are applicable large employers (ALE)?
Those with at least fifty (50) full-time employees or full-time employee equivalents are considered an ALE, while those with smaller numbers are classified as SE.
Note that this classification helps set varying employer obligations.
For one, ALEs are required to give minimum essential coverage for their employees.
Specific informational returns, including Form 1095-C, are also part of what they must file with the IRS.
As can be seen, there is not a universally recognized number of hours that differentiates full- and part-time employment, even when the government mandates individual employers to provide sets of benefits to their employees.
In most instances, employers determine work hours per employee in a week or other designated time frame such as on a monthly basis. This is to determine which are the qualified employees for full-time benefits like healthcare benefits, insurance benefits, and the like.
Moreover, even when employer responsibility calls employers to be legally obligated in crafting some form of competitive benefits program and other compensation benefits, the number of hours employees must work to qualify for those benefits differs from one major employment law to another.
Thus, the answer to, “How many hours must an employee work to be full-time?” is, for good or bad, “It depends.”