If you’d like to switch an employee from full time to part time for economic reasons, you’re not alone.
As of October 2021, around 4.4 million people were employed part time for economic reasons, unchanged from 4.4 million in February 2020 — according to the Bureau of Labor Statistics (BLS). These individuals worked part time involuntarily, due to their hours being reduced or not being able to find a full-time job.
Despite the large number of employees working part time involuntarily, many employees voluntarily (or choose to) work part time. Regardless of the reason for the switch, an employer has considerable grounds to cover when moving an employee from full time to part time.
This guide is designed to help you navigate the transition. It includes:
An employee may voluntarily decide to switch from full time to part time because of:
As stated earlier, part-time employment is often involuntary. Even then, there can be upsides for the employee. For example, they may prefer part-time employment over losing their job altogether. Because of the reduced work hours, the employee may qualify for unemployment benefits, which can help to plug the financial gap.
As the United States economy rebounds from the COVID-19 pandemic, employers are struggling to fill positions. For this reason, it’s critical to hold on to qualified employees. In fact, one study found that “Talent retention is the top employer concern in 2021, and 39 percent of companies believe at least one in five in their workforce are currently looking for new jobs at other companies.”
As previously mentioned, one way to retain employees is to offer them part-time work instead of laying them off. Depending on their situation and level of organizational commitment, they might choose to stay.
Keep in mind that conservative estimates put the cost of replacing an employee at around $15,000. You can avoid this cost burden plus minimize operational disruptions by switching an employee from full time to part time.
Note, as well, that flexible work options are becoming crucial to retention. In one survey, 46% of respondents cited part-time scheduling as their flexible work option of choice. By offering or agreeing to move an employee from full time to part time, you exhibit flexibility.
It’s important to determine the number of hours that constitute “part-time employment” at your company.
The BLS defines part-time workers as “those who usually work fewer than 35 hours per week.” Those who work 35 hours or more are full time. However, these definitions are for statistical purposes; they are not legal definitions. Also, the Fair Labor Standards Act (FLSA) — which governs federal wage-and-hour laws — does not cover part-time employment.
Usually, it’s up to the employer to decide what represents full-time and part-time status within the company. This ultimately depends on the requirements for the position. That being said, part-time employment typically requires less than 30-35 hours per week.
Going from full time to part time generally means fewer job responsibilities. How employers should handle hourly wages or salary varies according to nonexempt or exempt status.
Part-time employees are often classified as nonexempt, hourly — meaning they are eligible for overtime. These employees must receive no less than the federal or state minimum hourly wage, whichever is higher.
Can you move a full-time exempt employee to part-time exempt status? The short answer is yes.
The long (FLSA) answer:
If you cannot justify paying an exempt part-time employee $684 or more per week, consider switching them to nonexempt, which enables you to pay a lower rate. Although this qualifies them for overtime, the chances of them working overtime as a part-time employee is likely nonexistent or minimal.
Note that some states have overtime exemption laws, which may differ from the FLSA.
This comes down to your policy on benefits for part-time employees plus applicable legal requirements.
Remember to consult state and local laws for any mandatory benefits requirements. For example, part-time employees are normally eligible for workers’ compensation, and many states require paid sick leave for full-timers and part-timers. There may be provisions, as well, for unused vacation time.
The state may require an employer to notify employees in advance of changes to their employment status, pay rate, or work schedule. So, before you switch an employee from full time to part time, check for any notice requirements.
Even if it’s not a legal requirement, it’s common courtesy to inform employees prior to changing their employment status, pay, benefits, or working conditions.
You must consider numerous factors when moving an employee from full time to part time. You can achieve a successful transition by understanding the legal and non-legal aspects of part-time employment and communicating seamlessly with the employee.