Employee Type

If you are a business owner, one of the most important decisions that you will make will be about hiring. Getting people on board is a crucial step as you scale. But hold on, it’s not as simple as hiring somebody and paying them for their work. In a labor market that is complex and competitive, there are many employee types to select for your business needs. 

Here are examples of employee types: 

Full-time Employees

• Full-time employees can be paid hourly or on salary. 
• On average, full-time employees work 30- 40 hours a week or 130 hours of service per month according to Internal Revenue Service (IRS) standards. Because the hours may vary per employer, be sure to understand your state laws on full-time employment. 
• The Fair Labor Standards Act (FLSA) does not have a specific definition of full-time or part-time employees. Therefore, the minimum number of work hours is established by the employer. 
• According to federal and state laws, employers with more than 50 full-time employees are required to offer health care coverage to all full-time employees and their dependents. 
• Other benefits that are usually given are Paid Time Off (PTO), retirement plans such as 401(k), and other benefits that can vary per company. 

Part-time Employees

• Part-time employees are those who work less than 30 hours per week. 
• They are usually paid by the hour instead of a fixed salary. 
• In some cases, part-time employees can choose the hours that they will. However, this will still depend on the company. 
• In general, part-time employees are not entitled to receive employee benefits. While employers are not required to give them benefits, some organizations are beginning to offer benefits to part-time employees as a way of attracting and retaining talent. 

Temporary Employees

• Temporary employees are hired temporarily for a set length of time, for a particular project or business task. 
• Employers are not required to give temporary employees benefits. 
• Oftentimes, companies hire temporary employees through a staffing agency. 
• Temporary employees are eligible for Social Security and unemployment benefits. 

Seasonal Employees

• Seasonal employees are commonly hired during peak seasonal needs of a business such as during the holidays or summer. 

Tenured Employees

• The term “tenured employee” usually refers to employees who are employed in an academic setting like a tenured professor or teacher. 
• In the academic field, tenure is implemented to create a sense of job security. 
• Tenured employees cannot be terminated without just cause. 

Leased Employees

• Leased employees are those who are hired by companies via staffing agencies or employee leasing agencies for a specific job. 
• Leased employees are not listed in the employer’s payroll. Instead, the reporting, depositing, and withholding responsibilities will remain with the staffing agency. 
• Benefits will also be through the staffing agency instead of the organization that they are working for. 

Job-share Employees

• Job-share employees are those who share the same job. A job-share arrangement is one where a full-time position is divided between two or more employees. 
• Employees in this arrangement can receive benefits from the employer, prorated according to the job-share situation. 

Apprentice Employee

• Apprentice employees are those who learn a specific trade or skills from a more experienced employee commonly known as a journeyman. Common examples are apprentice plumbers and apprentice electricians. 
• There is a predetermined end to employment under apprenticeship. 

Journeyman

• Journeymen are individuals who teach and train apprentices about a specific trade or skill. Examples are journeyman plumbers and journeyman electricians. 
• They typically work in industries that require license certifications and specialized training. 
• Apprentices can become journeymen once they have completed their apprenticeship and have completed all the necessary certifications for their field. 

Contingent Workers

Strictly speaking, contingent workers are not considered employees of a company. They provide services on a short-term arrangement such as a per-project basis and are not entitled to employee benefits.

Independent Contractors

• Independent contractors are sourced by companies for work and services for a single project or as needed. 
• They are self-employed. While they are expected to work according to the needs of the employer, independent contractors do not need supervision in performing their work.
• They are responsible for paying their taxes.
• Independent contractors are not entitled to employee benefits. 

Freelancers

• A type of independent contractor, the term “freelancer” is often used by writers, photographers, artists, and other creatives. 

Consultants

• Consultants are types of contingent workers who offer professional advice to companies. They are usually considered experts in their field who have attained a high level of experience. 
• Common examples of consultants are those who specialize in law or education. 
• They provide their services as needed depending on the organization’s needs. 

Interns

• Interns are individuals who have an educational background in a particular field. 
• When you speak of an internship, it focuses on on-the-job training. Many college students opt to become interns to gain real-world experience and lessons that they can use once they finish school. 
• Interns receive guidance and supervision from employers. Oftentimes, they can apply to be an employee of the company once they have finished the internship. 
• They can be paid or unpaid. This would depend on the employer. However, employers need to follow federal regulations and requirements. 

Each organization is unique. The hiring structure and type of employees may differ from one business to another. When looking to hire employees or contingent workers, employers must consider the impact it will make not just on the business budget but also on the overall company culture and work environment.