Full Time vs. Part Time Benefits: What’s the Difference and Which is Better?

Because the US is considered an at-will country, employers are only required to give employees certain benefits if they’re full-time, including access to health insurance. Larger companies (50 employees or more) are required under the Family and Medical Leave Act to give full-time employees 12 weeks of unpaid time off per year. Employers in the US often give full-time employees extra fringe benefits to remain competitive and reward employees for their hard work. 

Full-time employees typically work a standard number of hours per week and are entitled to a comprehensive package of benefits that may include health insurance, retirement plans, and paid time off. On the other hand, part-time employees work fewer minimum hours and often receive a more limited or scaled-down version of benefits. 

In this article, we’ll explore full-time vs. part-time employee benefits in the US and give a breakdown of typical benefits each classification of worker receives. 

What’s the difference between full-time and part-time? 

Understanding the differences between part-time and full-time employees and their corresponding benefits is vital. Both employers and workers should understand these benefits in the US to ensure a fair and balanced working environment.

Here are some of the key differences between the two:

• Work Hours and Status:

  • Full-time employees typically work between 40-a standard 40 hours per week. However, salaried employees may be considered full-time but end up working more than 40 hours as defined by the employer.

  • Part-time employees work fewer hours per week than full-time employees. The specific number of part-time hours will always be lower than full-time hours, but most businesses have part-time employees working below 35 hours right around 30-35 hours per week. 

• Eligibility for Benefits:

  • Full-time employees are more likely to be eligible for a comprehensive package of benefits. These benefits may include health insurance, retirement plans, paid time off (vacation and sick days), and other perks like tuition reimbursement and employee discounts.

  • Part-time employees may also be eligible for some benefits, but the amount of benefits offered to workers is up to the employers. Employers are usually exempt from legally providing part-time employee benefits. 

Overtime laws in the US for full-time and part-time employees 

Overtime pay is an additional compensation that some employees receive for working more than the standard number of hours in one week. Employees that are classified as exempt or salaried usually do not receive overtime pay. 

Here's a breakdown of how overtime pay splits between the two classifications in the US. 

Full-time employees:

Full-time employees that are non-exempt or aren’t salaried are typically eligible for overtime pay if they work more than the standard number of hours defined by labor laws or the employer's policies. For example, if the standard work week is 40 hours and an employee works 45 hours in a week, the additional 5 hours are considered overtime.

For both full-time and part-time employees, overtime pay is set 1.5 times the regular hourly rate for each hour worked beyond the standard week. 

Part-time employees

Part-time employees are eligible for overtime pay if they work more than the maximum number of hours defined by labor regulations for part-time employment.

It's important to note that not all part-time employees may work enough hours to qualify for overtime pay, as they might not reach the threshold of 40 hours per week that is considered full-time in the US. 

What benefits do full-time and part-time employees receive? 

Because the United States is considered at-will, employers are not required to provide their employees with any benefits at all. The only required benefits in the US by employers are social security, unemployment insurance, medicare, and family and medical leave (if the employer has more than 50 employees). 

Some states, including California and Hawaii, require additional employee benefits to be provided to full-time workers, while others, like Florida and North Carolina, require none. 

However, many employers choose to give workers in the US additional employee benefits as an incentive for attracting top talent and boosting worker morale. 

We’ll explore below some typical benefits that full-time employees receive vs. part-time employees below. 

Health Insurance

Full-time employees are more likely to receive health insurance coverage from their employer. The employer may cover a significant portion of the premium, and the coverage is often comprehensive. 

Part-time employees may also be offered health insurance, but the employer's contribution may be lower, and the coverage may be less extensive.

Retirement Plans

Full-time employees often have access to retirement plans like a 401(k) or pension plan with employer contributions, which can help them save for retirement.

On the other hand, part-time employees usually aren’t offered these perks. 

Paid Time Off

Full-time employees receive some form of paid time off, which may include vacation days, sick leave, maternity and parental leave, as well as paid holidays off. 

While part-time employees may also receive some paid time off, it is typically prorated based on the number of hours they work. In the US, it’s up to the business owner’s discretion whether they want to pay their part-time employees for bank holidays off. 

Job Stability and Protections

One of the best parts about being a full-time employee is job stability. Full-time employees will usually sign an employment contract in the US that states exactly what job protections they’re entitled to, such as notice periods before termination and eligibility for a severance package and unemployment benefits.

However, part-time employees may have more flexibility in their work schedule but usually don’t have as many protections in their jobs. Part-time employees don’t often receive any severance benefits and may not even receive notice upon termination. 

Pay and Compensation

Another advantage of being a full-time employee is receiving a fixed monthly salary or an annual wage, depending on the employer's pay practices. This gives employees the opportunity to plan out their finances each month.

Part-time employees are often paid on an hourly basis or receive a pro-rata portion of a full-time salary, reflecting the number of hours they work.

Opportunities for Advancement

One of the best parts about being a full-time employee is having access to more opportunities for career growth and advancement within the company.. This means they can take on more responsibility and have their achievements recognized more quickly.

On the other hand, part-time employees may have fewer advancement opportunities within the same company due to their reduced work hours and temporary nature of their roles.

How an EOR can help with employee benefit management 

An employer-of-record (EOR) handles various human resources tasks and assists with global hiring, including payroll, taxes, compliance, and employee benefit management. 

Benefit tasks that an EOR takes care of include: 

• Benefit administration 

• Benefit plan selection and customization 

• Enrollment support

• On-the-ground support and help with compliance 

• Communication and employee support

• Cost management and reporting

By outsourcing employee benefit management to an employer of record, small businesses can streamline their HR processes, reduce administrative burdens, ensure compliance, and provide their employees with a more efficient and effective benefits experience. 

Employers can now focus on their core business while leaving the complexities of HR management to the EOR.

How Justworks Can Help 

Justworks’ global EOR is the solution for small businesses looking to easily hire talent in countries where they don’t already have a legal presence. 

Justworks has direct entities in 11 countries, with the ability to hire in 100+ additional countries upon request through our trusted local partners. You can fearlessly handle HR essentials like payroll, benefits, local compliance, and more. 

Learn more about our EOR services, and get started today!

FAQ

What benefits do full-time employees get? 

Depending on where the employee is working, most full-time employees are entitled to: 

• Vacation and sick pay

• Holiday pay

• Retirement 

• Health insurance 

• Maternity and parental leave

• Severance packages 

Does it make a difference if an employee is full-time or part-time? 

Yes, it does make a difference if an employee is full-time or part-time. Full-time employees usually enjoy a lot more perks and benefits. Part-time employees have more flexibility in their job but they aren’t usually entitled to benefits and their positions can be a little more unstable. 

What are the top 3 sought-after employee benefits? 

Three of the most sought-after employee benefits are: 

• Health insurance 

• Vacation pay 

• Retirement packages 

Why should you only work part-time? 

One of the advantages of working part-time is that you can have more flexibility in your schedule. You may even be able to pick and choose when you work depending on what field you’re performing services in.