Legal Considerations
Businesses that are seasonal may have different laws than year-round businesses. Most of the law differences surround employment laws. For instance, is a seasonal worker entitled to unemployment compensation in the off-season? Sometimes the answer is an easy one and sometimes it requires some math.
📖 Locate and read 43 P.S. Labor § 802.5 Eligibility of Seasonal Workers in Fruit and Vegetable Food Processing. 💡If you represent a Pennsylvania orchard that sells canned peaches, what questions would you ask it and what advice would you give based on this statute?
It is important to know whether your client is operating as a seasonal business. In some states, the company will not need to contribute to the unemployment compensation fund via tax dollars. As a matter of fact, in some states, if your client has paid into the UC coffers, that is a strong indication that the worker should be able to claim unemployment in the off-season.
What if your client wants to hire individuals from another country? They will need to be up to date on the H-2B visa rules which can change quite often. 💡Read the DoL Wage and Hour Division Field Assistance Bulletin. And if they are in the agricultural industry, H-2A visas. Now review this summary of the Migrant and Seasonal Agricultural Worker Protection Act. Consider all that is involved. Now consider that the DoL Wage and Hour Division is on top of this. This agency recently identified violations in 81% of the 71 cotton gin investigations it completed between Nov. 2019 and Mar. 2021 in the Southeast. The most common violations included FLSA violations, but also more to this section’s focus, failures to ensure housing safety and health, as well as provide terms and conditions of occupancy as required by the MSPA and H-2A visa program. DoL publicly provided a list of the violators and the amounts of money each had to pay in wages and penalties. Something else to keep in mind that was brought up in a conversation with Attorney Devon Kennefick is that employers need to treat their U.S. workers the same as corresponding workers who are covered under the visa rules (i.e., wages and treatment should be equal), whether the employer files for H-2A or H-2B workers. If an employer fails to do so, it could lead to additional visa violations from the Wage and Hour Division with potential fines and other consequences imposed on the employer.
Regarding health benefits, the Affordable Care Act (ACA) had some rules about large full-time employers (greater than 50 employees) and providing health insurance. Seasonal employers were exempt. Because ACA is up in the air, we’ll forgo further coverage of it but keep in mind that being a seasonal business mattered for purposes of ACA.
Additionally, seasonal employers in certain industries, such as amusement or recreational establishments, have to abide by their own sets of rules. The Fair Labor Standards Act (FLSA) does not apply to such businesses so long as the company does not operate for more than 7 months in a calendar year or during the previous year, the company’s average receipts for any six months were not more than 33% of its average receipts for the other six months. (MATH!)
The above examples should highlight to you the importance of differentiating between seasonal and year-round workers.
Of note, a majority of laws apply to all businesses regardless of time of operation. For example, overtime and minimum wage laws still apply. Workers’ compensation still applies.
