Seasonal employment refers to temporary job roles created to support businesses during periods of heightened activity, such as holidays, tourist seasons, or specific times of year when demand spikes.
Understanding Seasonal Work
Seasonal roles are particularly useful for companies that operate during limited months or need extra staff only at specific times. These positions are usually filled by temporary workers who are not expected to remain employed throughout the year.
For example, a retailer might bring on additional staff in December to manage the holiday rush. Other common seasonal roles include delivery drivers, hospitality staff, event crew, tax preparers, agricultural laborers, and customer service reps.
IRS Criteria for Seasonal Employees
The IRS classifies seasonal workers as individuals who are employed for 12 months or less. If a worker exceeds this period, they are no longer considered seasonal. Regardless of employment type, all employees must complete a Form W-4 to ensure accurate income reporting and proper tax withholding.
Are Seasonal Workers Taxed?
Yes. The IRS treats seasonal workers like any other employees, meaning employers must withhold:
- Federal income tax
- Social Security and Medicare (FICA) taxes
- State and local income taxes, where applicable
Wages paid to seasonal workers, including tips and bonuses, must also be reported.
How Are Seasonal Employees Paid?
Employers have flexibility in deciding how to pay seasonal staff, but must comply with minimum wage and overtime laws, both federal and state. For nonexempt seasonal workers, overtime is typically calculated at 1.5 times their regular rate for hours worked beyond 40 in a week.
Many businesses prefer to pay seasonal workers on a weekly or biweekly basis, offering more financial consistency and potentially boosting morale. Employers might also provide early wage access, depending on business priorities and cash flow.
Industries That Rely on Seasonal Workers
Several sectors rely heavily on seasonal employment, including:
- Retail: Temporary staff are often hired for peak shopping seasons like the winter holidays.
- Construction: Some regions ramp up projects in spring or fall, avoiding extreme weather conditions.
- Agriculture: Farms typically hire extra hands during planting or harvest seasons.
- Tourism: Locations with peak summer or winter demand often hire temporary hospitality and service workers.
Seasonal vs. Part-Time Employment
While both seasonal and part-time employees may work fewer hours than full-time staff, the main difference lies in duration:
- Part-time workers may work year-round with a consistent schedule.
- Seasonal employees are hired only during specific busy periods and may work intensively for short stretches.
Both types of workers can be transitioned into permanent roles, depending on the employer’s needs.
Advantages of Hiring Seasonal Staff
- Lower labor costs: You only pay workers when they’re needed.
- Trial-to-hire opportunities: Temporary work can serve as a test run for future permanent roles.
- Faster recruitment: Hiring is often quicker and less formal compared to full-time roles.
Challenges of Seasonal Hiring
- Motivation may be lower: Temporary roles can result in reduced engagement unless expectations are clearly communicated.
- Limited training time: Seasonal workers often receive minimal training, which can impact performance if not managed carefully.
- Employee turnover: Workers may leave unexpectedly for more stable or better-paying roles.
- Labor shortages: It can be challenging to find qualified seasonal candidates, especially in competitive industries.
Do Seasonal Workers Get Benefits?
Typically, seasonal employees aren’t offered traditional full-time benefits such as health insurance or retirement plans. However, companies may still provide fringe benefits to attract quality talent:
- Flexible schedules
- Wellness stipends (for gym memberships, fitness classes, or mental health services)
- Commuter assistance (parking, public transportation, fuel reimbursements)
- Incentive programs (performance bonuses, commissions)
- Skill development (training, courses, or industry events)
Can Seasonal Employees Receive Unemployment Benefits?
Eligibility for unemployment benefits depends on several factors, including:
- State-specific laws
- Duration of employment
- Total earnings
- Reason for job separation
Some states allow laid-off seasonal workers to claim unemployment during the off-season, while others do not. Employers should review local regulations to understand what applies in their region.