The Benefits and Drawbacks of Hiring Temporary or Seasonal Workers

Last week we talked about freelance workers and how to get them, but sometimes you need someone for more than specific project. If you simply need extra help for a portion of time, what you are looking for is a temporary worker. Many businesses employ temporary during workers during the holidays so many times temporary workers are called seasonal workers.

Temp workers can be an amazingly useful resource to your business. Keep in mind that a temporary worker is someone who is hired to fill a short-term position. These workers are always employed for less than a year. Sometimes, a business might find a seasonal or temporary worker indispensable and will hire them for a permanent part-time or full-time position, or even utilize them on a freelance basis.

When you choose to hire a temporary employee, we want you to be prepared. Here are a few things to keep in mind when you are gearing up to hire temporary employees:

Labor Laws – Labor laws still apply to your temporary workers. Your workers are protected by the Fair Labor Standards Act as well as other laws to protect them from an unsafe workplace.
Taxes – Your temporary workers are still subject to the same tax laws that a permanent employee is subject to.
Social Security/Medicare – Just as with income taxes, you must withhold wages for Social Security and Medicare and match the amount.
Workers' Compensation – If an employee is injured on the job, even if they are only a temporary worker, you still need to provide this benefit.
Unemployment – Some states do not require unemployment benefits for seasonal workers working 10 weeks or less, but beyond that you are not exempt from paying this. You can check with the Department of Labor for more data for your state.

But is it worth getting a temporary employee instead of a permanent one? Let's look at the pros of having a temporary employee:

Easier to fluctuate paid time as work needs it: If you have a couple of temps, each working 20 hours a week and one calls out sick one day, the other may be able to fill in. This flexibility also makes it easier to lower hours if you do not need them working as much.
Can add a specialization to your business – A temp worker might be just the thing you need you hire someone with a special skill set to fit your specific needs during a specific time of year.
They can help you evaluate workforce needs – Are you getting close to the point where you need to hire someone full-time? On the individual level, having someone as a temporary or seasonal worker allows you to see how they handle the job first with less risk. On a business level, this temporary arrangement can help you figure out if you would benefit from having an extra employee in general.
Time and money savings – If you are hiring someone as a temporary or seasonal employee, you do not need to worry about paid time off and other extras.

And of course temporary workers come with their own set of disadvantages:

Is there a better job out there? - This is the most obvious one, if someone is a temporary/seasonal worker they will not have the same level of loyalty as a permanent employee. What's to keep them from going to another job with better pay, or that wants them full-time and permanent?
Training – Not all temps are going to come ready to handle what you need, so you may need to train them to do the job. This is an investment that you won’t benefit from long term unless you hire them as a permanent worker.

So you have you decided to get some temporary or seasonal employees? Should you hire them yourself or go through an agency?

Here are the pros and cons of using an agency for your temporary employees:

Pros

It removes your need to recruit people personally. That means you’ll have more time to spend on your business.
Using an agency removes the need to worry about tax issues. An agency is responsible for paying the temporary employee and covering the taxes and any benefits.
If a temp from an agency is not working out for you, you can get them replaced within a business day or two.

Cons

You have no personal interaction with the employee before they show up for work.
Even though you do not have to worry about taxes and benefits, you may end up paying more as you are covering their pay plus the pay for time of the employee at the temp agency running payroll.
If you decide you like a temp, you may not be able to hire them outright as you may need to sign a contract for a set time period. Not all contracts allow you to “buyout” the rest of the time on the contract.

So there you have it, temporary/seasonal workers in a nutshell. If you have a project and do not want a freelancer, or need someone from a particular time of year, a temporary or seasonal worker might be the thing you are looking for.

Note: We are based in the United States, so some of the rules and regulations we mention may be different for businesses in other countries; you should research laws in your own country.

Good Luck and Good Sales!