UNIQUE ISSUES IN HIRING AND FIRING SEASONAL EMPLOYEES

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1 Minnesota Association of Townships Document Number: E4000 Information Library Date: April 2005 UNIQUE ISSUES IN HIRING AND FIRING SEASONAL EMPLOYEES By: Scott J. Riggs, Attorney & Robert A. Alsop, Attorney Kennedy & Graven, Chartered 470 U.S. Bank Plaza 200 South Sixth Street Minneapolis, MN UNIQUE ISSUES IN HIRING AND FIRING SEASONAL EMPLOYEES This memorandum sets out how seasonal employment is currently handled in the fictional Anytown, USA, and provides recommendations regarding the questions and issues that could arise from such a scenario. Recommendations regarding advertising of seasonal positions, terminating the seasonal employment relationship, re-hiring seasonal employees, and a number of other issues that arise under various statutes, including, the Public Employment Labor Relations Act ( PELRA, Minnesota Statutes Chapter 179A), the Public Employee Retirement Association ( PERA, Minnesota Statutes Chapter 353), the Minnesota Unemployment Insurance Law (Minnesota Statutes Chapter 268), and the federal (29 C.F.R ) and state (Minnesota Statutes Sections ) fair labor standards statutes are discussed. In addition to the referenced, specific issues concerning seasonal employees, the most difficult aspect of any employer-employee relationship involves situations of discipline, up to and including termination. Such issues significantly impact the seasonal employee relationship. A generic termination/discipline checklist is set-forth at Section 8 of this memorandum that will be referred to during this presentation. Hypothetical Facts: Every year, Anytown hires seasonal employees to work on various town projects. Seasonal positions are not advertised, because, in general, the same individuals return to the same seasonal positions every year. The town s current practice is to keep seasonal employees on the payroll year-round, although they only work on a seasonal basis. Generally, when seasonal employees are hired, no definite date of termination of the seasonal employment is communicated to the employee, although seasonal employees are notified at some point during their employment that the employment will be ending on or about a particular date. Finally, although some town employees may be covered by collective bargaining agreements, seasonal employees generally are not covered by those agreements. 1. Advertising Seasonal Positions Should Anytown advertise seasonal positions? The reason the town has not been in the practice of doing so is that, in general, the same individuals want to return to the same seasonal employment positions every year, and the town wants to rehire those individuals each year. 1

2 There is no legal requirement that a town advertise vacancies in temporary and seasonal positions. Often times personnel policies of municipalities treat the hiring procedures for temporary and seasonal positions differently from the practice of advertising vacancies in regular (i.e., non-temporary and non-seasonal) positions. Although it may seem unnecessary to advertise when the same seasonal employees are returning every year, it is recommended that the town advertise anyway. The reason for advertising seasonal positions is that doing so may help the town avoid discrimination claims from persons who were interested but did not have an opportunity to apply for a seasonal position. For example, if the individuals that return to the seasonal positions are all male, and a female desires to apply for such a position but does not have an opportunity, she may claim to have been discriminated against on the basis of her gender. By advertising the positions, the town demonstrates that it has an open hiring process that does not exclude any interested applicants. 2. Ending The Seasonal Employment Relationship The town should take steps to ensure that there is a definite term of employment for seasonal and other temporary employees. Definite terms of seasonal employment may help the town to avoid liability under other statutes. For example, the Minnesota Veterans Preference Act ( VPA ) does not cover temporary employees; however, a failure to designate a definite term of employment could result in a determination that an employee was not employed on a seasonal or temporary basis and is therefore entitled to certain rights under the VPA. It is essential that the town communicate to all seasonal employees at the time they are hired the term of the employment (subject to provisions in Section 8 below). It is also extremely important that the town remove seasonal employees from the payroll when the seasonal employment ends. Re-hired seasonal employees should be treated as new employees each time they return for another season of employment. With regard to terms of seasonal employment, bear in mind that the Public Employment Labor Relations Act ( PELRA ) excludes seasonal employees from its coverage, but only if strict time restrictions on terms of employment are followed. This is discussed in Section 4 below. 3. Re-Hiring Seasonal Employees In general, new Anytown employees are required to fill out several forms related to their employment. Should re-hired seasonal employees be required to complete those forms when they return for another season of employment? Re-hired seasonal employees should be required to complete all forms that must be completed by new town employees. This will help to emphasize that the seasonal employee s previous seasonal employment ended, the importance of which is explained in Section 2 above. 2

3 4. Public Employment Labor Relations Act ( PELRA ) Under PELRA, public employees are entitled to participate in any applicable collective bargaining units. In defining the term public employee, PELRA specifically excludes any temporary or seasonal employee who either (i) does not work more than 67 days in a calendar year, or (ii) does not work more than 100 days in a calendar year if the employee is under the age of 22 and is a full-time student who intends to continue his or her education after the temporary or seasonal employment ends. Minn. Stat. 179A.03, subd. 14(f). If a town wishes to avoid having seasonal employees become eligible to join collective bargaining units, it must ensure the following: (i) seasonal employees must not work more than 67 days in a calendar year, or, (ii) seasonal employees who are under age 22 and are full-time students who intend to return to school when the seasonal employment ends must not work more than 100 days in a calendar year. 5. Public Employees Retirement Association ( PERA ) Public employees who earn more that $425 per month are entitled to participate in PERA. Seasonal and temporary employees who work less than six months, however, are not entitled to participate in PERA. PERA requires that the public employer determine before or at the time the employment commences that the employment will not exceed six months. If employment in a temporary position extends beyond six consecutive months, the head of the department shall report the employee for membership if salary in any month exceeds the salary threshold. Therefore, if the town wants to avoid having its seasonal and temporary employees participate in PERA, (i) it must not employ any such employee for more than six months, and (ii) it must determine in advance that the employment will not last longer than six months and that determination should be documented and communicated to the employee. 6. Minnesota Unemployment Insurance Law The Minnesota Unemployment Insurance Law regulates unemployment compensation. Temporary and seasonal employees who do not obtain other suitable employment when their temporary or seasonal employment ends are entitled to seek unemployment benefits, even if they accepted the employment with the understanding that it was temporary or seasonal in nature. Therefore, the town should be aware that it could be liable for paying unemployment benefits to its seasonal and temporary employees when such employment ends, if the employees have not found other employment. 7. Fair Labor Standards Act ( FLSA ) Seasonal and temporary employees are entitled to overtime pay and/or compensatory time under the federal and State Fair Labor Standards Acts to the same extent they would be if they were regular employees. In addition, the federal FLSA allows seasonal employees to accumulate up to 240 hours of compensatory time. 29 C.F.R (a). 3

4 8. Termination/Discipline Checklist Employee Problems/Complaints Notice of employer s expectations Personnel policies Job descriptions Oral instruction Documentation of problems Employee evaluations Investigation Tennessen Warning Garrity Warning Employment Relationship At will Contract Property rights (progressive discipline, just cause) Modifications to above Types of discipline Oral reprimand Written reprimand Suspension without pay Termination Past application of discipline Notice requirements Hearing requirements Veteran s preference (Minn. Stat ) Other contract terms Employment contracts Oral promise (modification after appointment) Personnel policy Collective bargaining agreement Employment at will vs. property rights (just cause Loudermill notice) Peace Officer Discipline Procedures Act (Minn. Stat ) Civil service hearings Open meeting concerns 4

5 Data practices concerns General termination issues Whistle Blower (Minn. Stat ) Workers compensation Unemployment compensation Request for true reason for termination (Minn. Stat ) Minnesota Human Rights Act (Minn. Stat. 363A) Equal Employment Opportunity Act Title VII of the Civil Rights Act Age Discrimination and Employment Act 1990 Older Workers Benefit Protection Act Americans with Disabilities Act Drug-free Workplace Act of 1988 Personnel file References 5