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Compliance Corner: Understanding Seasonal Employment-- Top 7 Considerations Before Hiring

Friday March 29th, 2024

Estimated time to read: 4 minutes, 15 seconds

Compliance Corner

When you run a seasonal business, recruiting, hiring and managing temporary staff comes with a unique set of legal challenges. What should you know before you bring in workers to ensure you stay compliant with pertinent laws and regulations? Here are seven things to take into consideration when it comes to seasonal employment.

1. Hiring Interns

If you're thinking about using interns to help with seasonal work, it’s important to understand the Department of Labor (DOL) rules that determine whether an intern must get paid. The current test to decide if interns of for-profit companies count as employees under the Fair Labor Standards Act (FLSA) has seven factors (see below) , none of which is determinative.

  • The extent to which the intern and the employer clearly understand that there is no expectation of compensation. Any promise of compensation, expressed or implied, suggests that the intern is an employee—and vice versa.
  • The extent to which the internship provides training that would be similar to that which would be given in an educational environment, including clinical and other hands-on training provided by educational institutions.
  • The extent to which the internship is tied to the intern’s formal education program by integrated coursework or the receipt of academic credit.
  • The extent to which the internship accommodates the intern’s academic commitments by corresponding to the academic calendar.
  • The extent to which the internship’s duration is limited to the period in which the internship provides the intern with beneficial learning.
  • The extent to which the intern’s work complements, rather than displaces, the work of paid employees while providing significant educational benefits to the intern.
  • The extent to which the intern and the employer understand that the internship is conducted without entitlement to a paid job at the conclusion of the internship.


If the analysis reveals that an intern is actually an employee, they’re entitled to minimum wage and overtime pay.

2. Correctly Classifying Seasonal Employees

Just like regular employees, you’ll want to ensure you classify seasonal workers correctly. Most of these staff members will be non-exempt versus exempt workers. This means they’re eligible for federal minimum wage and overtime pay protections under the FLSA and may be protected by state wage and hour laws as well. It’s important to note that some seasonal staff are exempt from minimum wage and overtime rules.

While it can be challenging to determine the right classification, the two factors to consider are:

  • Salary: Employees classified as exempt must be paid on a salary basis at generally not less than $684 a week.
  • Duties: Employees who perform certain duties are exempt, including: executive, administrative, professional, computer and outside sales.


If you’re using gig workers to fill seasonal roles, it’s also important to make sure you analyze your relationship with these workers to determine if they’re either independent contractors or employees under the latest rule from the DOL effective March 11, 2024.

3. Offering Employment to Youth Workers

Many students look for summer jobs, and you’re allowed to hire children as young as age 14 under federal law. But you’ll want to make sure you’re following the Department of Labor rules to keep these workers safe.

Specifically:

  • 14 and 15-year-olds: If you’re hiring 14 or 15-year-olds, they can only work for limited periods of time in non-manufacturing and non-hazardous jobs. There is a list of permitted occupations for these workers.
  • 16 and 17-year-olds: These teens may be employed for unlimited hours in any job other than those declared hazardous. The restricted occupations can be found here.


It’s important to pay attention to these employment provisions or you risk a civil monetary penalty of up to $11,000 for each minor employed in violation.

In addition to federal requirements, be sure to also review your state’s child labor laws and comply with the more stringent standards.

4. Health Benefits

Most employers don’t offer group insurance benefits to seasonal employees. However, if you have 50 or more full-time employees, you need to be aware of the Affordable Care Act’s employer mandate.

If you use the monthly measurement to determine full-time employees, you have to offer coverage to all workers who work at least 30 hours per week, including those who only work for you on a seasonal basis. However, if you use the look-back method, you may not need to treat seasonal staff as full-time during the initial measurement period and may exclude them from health insurance.

While the law offers flexibility for businesses that rely on a seasonal workforce for part of the year, be sure you understand the rules to determine whether to extend health benefits to these workers. 

5. Hiring Seasonal Employees with Temporary Work Visas

One way many businesses combat the shortage of seasonal employees is by relying on foreign workers who hold either a J-1 foreign student visa or an H-2B visa. 

  • The J-1 Summer Work Travel program is offered through the Department of State. It is specifically for students with at least a semester of post-secondary academic study at an institution outside of the US who are coming here to teach, study, conduct research, demonstrate special skills or receive training in an approved program. If you’re looking to hire college students or recent grads for roles such as camp counselors, research assistants or trainees, this program can be a good option. 
  • The H-2B nonimmigrant program is a little more general and allows you to temporarily hire nonimmigrants to perform nonagricultural labor or services in the US regardless of their student status. These workers often fill seasonal employment gaps in positions like landscaping, grounds maintenance, restaurant/hospitality and construction. If you’re interested in this program, you’ll need to file an Application for Temporary Employment Certification with the DOL and be granted registration before you can start recruiting. In addition, you’ll need to comply with the program’s many requirements.

6. Minimum Wage and Overtime Pay

Since most seasonal workers are nonexempt, they’ll be entitled to minimum wage and overtime protections. That means, when you decide to offer seasonal employment, you’ll need to pay your temporary workers the federal minimum wage – or a higher rate if your state requires it. Additionally, any hours worked over 40 in one week must be paid at one and a half times their regular wage rate. 

However, there are some seasonal businesses whose workers are considered exempt from these rules. To qualify, yours must be an amusement or recreational establishment that either:

  • Operates fewer than seven months a year.
  • Has average receipts for any six months of the preceding calendar year of not more than 33-1/3% of your average receipts for the other six months of the year. 

7. Time-off Requests and Coverage

You’ll likely get requests for time off over the summer from seasonal workers. While it’s understandable employees will want to take vacation days or need sick time, it’s important that you remain adequately staffed so advance notice is critical.

Be sure your employee handbook clearly communicates the procedure for asking for time off. And don’t forget to consider protected leave like state-mandated sick leave, which applies to seasonal and part-time workers as well as full-time employees.

While seasonal employees may only work for your business for a short time, that doesn’t mean it is any easier to recruit, hire and manage these workers. For more assistance navigating everything that comes with offering seasonal employment, isolved’s HR Services is ready to help! 

About Susan Reardon:

Susan Reardon, HR Content Advisor with isolved, is a licensed attorney and communications professional with 20-plus years of experience in HR, insurance and employee benefits.

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