MCAE — Working Conditions: Worker Rights

Part-Time Work and Benefits in ABE: Questions and Answers
Compiled by the MCAE Working Conditions Committee

1. What does the Massachusetts ESE rate structure say about salaries and benefits, and what does it mean for me as a part-time teacher or counselor?

ESE sets minimum hourly salary requirements for full-time and part-time staff. ESE rates require that teachers and counselors (including part-timers) who do not receive benefits be paid at least $23.17/hour.

2. What are the ESE rates for different positions? How do these rates apply to certain work hours?

For ABE teachers and counselors: a direct service rate of $18.54/classroom hour plus 25% fringe benefits, or $23.17 for those without benefits.

For administrators: $25.50/hour plus 25% fringe benefits, or $31.87 for those without benefits; and

For clerical staff: $13.91 plus 25% fringe benefits, or $17.39 for those without benefits.

3. What about paid prep time for teachers? How is that reflected in the rates?

The rates also support a teaching to prep time ratio of 2:1. This results in a “contact hour rate” of $34.77 for teachers, based on a direct service rate of $18.54/classroom hour plus 25% fringe benefits, plus prep time: $23.17 X 1.5 = $34.77/hour. Paid prep time is not required when the hourly rate meets or exceeds the contact hour rate.

4. What rights do part-timers have in regard to workers’ compensation, Social Security, or other public benefits required by law as part of payroll?

Part-timers on staff have the same rights as full-timers to workers’ comp, unemployment insurance, social security, social security disability (SSI) and other legally required benefits. Contributions from the employer and employee are based on salary, which is of course pro-rated (lower) for part-timers than full-timers.

5. Can I tell from my paycheck what benefits I’m getting?

Health insurance and disability policy benefits aren’t typically listed on paychecks, except deductions for employee contributions, but they must be detailed in a written employee benefits plan and policy available to all employees. Social security (FICA), including social security disability insurance (SSI), unemployment insurance (Federally-funded is called FUTA, state-funded is SUTA) and the unemployment health care surcharge are listed as deductions on paychecks. Workers compensation is an insurance plan covering medical costs and partial pay for work-related injuries or illness, that an employer is required to carry (either self-insured or through an insurance company). You can ask Human Resources or the Director for the policy.

6. What about fringe benefits for part-timers that are offered by employers?

The ESE Rate System supports the same fringe rate for part-time as full-time employees (25%). Employers have to pay for benefits as part of the hourly rate, or the 25% fringe add-on, but not both. They are not required to provide benefits to employees at all (except for those listed in 1 above) by either law or ESE policy but must pay the 25% fringe add-on if they don’t. It’s up to the individual program. By law, employers cannot discriminate in benefits in regard to race, religion, gender or national origin. However, Mass. ESE does allow programs they fund to distinguish part-time from full-time (by paying no benefits, and the higher hourly rate, to part-timers).

7. How do I know what benefits I’m entitled to?

They should be clearly listed in a written employee benefits plan and policy that must be made available to all employees. It is typically given out at time of hire, but you may ask for a copy at any time, and the employer is required to share it.

8. Does MA ESE require that ABE programs hire part-time teachers?

No, that is a decision made by individual ABE programs, often based on convenience, custom (“we’ve always done it this way”), scheduling needs and budget. There is no set percentage of staff required by ESE to be part-time.

9. Do part-timers have to be hired as consultants?

No, and there are no minimum hours per week that require you to be considered a consultant. Regular, permanent staff, whether part-time or full-time, should by law be on the payroll, not considered consultants. See below.

10. What is the difference between a contractor, a consultant and an employee?

Consultants are paid as “1099” employees (after the IRS form 1099 for consultants.) Regular employees submit a W-4 IRS form to the employer when they are hired, and their tax return is on Form W-2.

There is no legal difference between a contractor and a consultant. If you are a contractor or consultant, basically you are self-employed but sell certain services to someone else, as an individual vendor or a business. You set your own hours, provide your own tools and worksite, pay for your own business expenses including work travel and materials, and direct and schedule your own work, and can build these costs into the consultant rate you charge.

If you are an employee, the employer directs and controls your work, provides instructions or training, sets work hours, location, and method of work, reimburses business expenses, provides a written employment contract, and deducts payroll taxes. An employee is an hourly, weekly or salaried employee who works regular hours for a specific employer, whether full- or part-time. In general, someone who works regular hours, works in a regular place of employment, uses tools and materials from the employer, and/or has an employer who sets the conditions, pace, location, and terms of the job, is an employee, not a consultant.

This provision is frequently violated, either to save an employer money or out of ignorance. Many employers erroneously classify their part-time employees as consultants. If this violation is determined by the Internal Revenue Service (IRS), the employer can be liable for back taxes (Social Security, Unemployment, etc.) plus stiff penalties. It might be in your interest to look into this if you are a regular part-time teacher but paid as a consultant.

11. What are the IRS criteria for consultants as opposed to employees?

The above are general criteria; consult IRS publications for details about the 11 IRS criteria. The Internal Revenue Service has a strict definition, with numerous criteria, for who is considered a staff person on payroll, and who is a contractor or consultant. There is a brief brochure describing this called “Independent Contractor or Employee . . .” —IRS Publication #1779 at http://www.irs.gov.*

12. What does Massachusetts state law say about employees vs. consultants?

In 2004, the Commonwealth of Massachusetts tightened up its criteria for contractors and consultants vs. regular employees by amending state law for the Department of Revenue (DOR). This state law is much stricter about who qualifies for independent contractor status than the Federal law or previous Massachusetts common law. Massachusetts law now presumes a worker is an employee unless several very specific criteria are met, including:

The worker is free from control and direction in the performance of services (that means supervision and direction of how you perform your work)
The services are performed outside the usual course of the company’s business; and
The worker is customarily engaged in an independently established business.

All three of these factors must be met for a worker to be considered an independent contractor. The location where the services are performed is no longer relevant. If you have the same responsibilities as other employees at work, you are probably not correctly classified as a consultant or contractor. Employers can choose to provide certain benefits for employees, but not to contractors (consultants), but they have to follow the law as to who is an employee and who is a consultant or contractor. Penalties can include civil and criminal penalties and multiple damages and attorneys’ fee awards in private litigation.**

* You can get more free information from the IRS at: http://www.irs.gov/publications/p15/ar02/htm/#d0e837, pp. 3-8. There are additional details in http://www.irs.gov/pub/irs-pdf-p15a.pdf. The form the employer fills out in response to a complaint about incorrect classification as a contractor or consultant is IRS Form # SS-8, “Determination of Worker Status for Purposes of Federal Employment Taxes and Income Tax Withholding. It is a lengthy questionnaire and provides much guidance about the criteria for contractor vs. employee.

** More information can be found at www.mass.gov/dor/TIR05-11: “Effect of New Employee Classification Requirements” or G.L.c.14 §6(1); G.L.c.62c§3. St. 2004, c.193, 26.

13. Is it legal to hire part-timers as consultants?

Not if they have a regular schedule and meet the other IRS or state criteria.

14. What are the advantages and disadvantages of being hired as a consultant vs. an employee?

It may not be in your interest to be considered a consultant vs. an employee. You might want to compare the relative advantages for your work situation. Sometimes employers pay consultants at a significantly higher hourly rate than employees, and this is legal. Consultants are not paid fringe benefits, but the hourly rate sometimes in effect covers those costs. However, consultants are not eligible for employer-paid payroll taxes that provide public benefits, including social security, social security disability, unemployment insurance, workers compensation, as well as fringe benefits. Not having these benefits deducted from your paycheck can result in a larger paycheck, but you give up the employer contribution to them, as well as the right to access these benefits (like Social Security) later on, when you might need them.

15. If I’ve been incorrectly classified as a consultant, what can I do about it?

The best thing might be for you, or a group of your co-workers, to bring the Director’s attention to the IRS and Massachusetts regulations. Many Directors do not know about these regulations and are simply making an error. A Director might then just change your status to permanent employee. If it’s not corrected, you could bring a complaint to the IRS or Massachusetts DOR, keeping in mind that that could mean stiff penalties for the program. In general, your job is more legally protected if you are acting in “concerted action,” that is, in a group, than if you go ahead alone.

16. Is there any regulation or law that says how many hours/week qualify you for benefits?

No, but there have been unsuccessful recent attempts to change this through state legislation.

17. Who makes decisions about part-timers’ fringe benefits, and what are they based on?

It’s generally a management decision, by the Board, Director and/or HR personnel. Some programs “pro-rate” part-timers’ fringe benefits, based on the proportion of weekly hours to full-time hours worked, and some do this for some benefits and not others. Many have a minimum hours/week worked before employees qualify for benefits. This is perfectly legal.

18. How do wages, benefits and part-time status vary among union and non-union programs?

Unionized programs generally pay at a higher rate and are more likely to include fringe benefits for both full- and part-timers, than are other programs. One reason is that most public institutions are unionized and part of a single salary scale in union contracts, and ABE teachers’ salaries and benefits are more comparable to those of other public employees.


	Working Conditions Working Conditions Making a Living(?) in Adult Education Working Conditions Standards Worker Rights Get Involved Working Conditions Committee	WORKERS’ RIGHTS Part-Time Work and Benefits in ABE: Questions and Answers Compiled by the MCAE Working Conditions Committee 1. What does the Massachusetts ESE rate structure say about salaries and benefits, and what does it mean for me as a part-time teacher or counselor? ESE sets minimum hourly salary requirements for full-time and part-time staff. ESE rates require that teachers and counselors (including part-timers) who do not receive benefits be paid at least $23.17/hour. 2. What are the ESE rates for different positions? How do these rates apply to certain work hours? For ABE teachers and counselors: a direct service rate of $18.54/classroom hour plus 25% fringe benefits, or $23.17 for those without benefits. For administrators: $25.50/hour plus 25% fringe benefits, or $31.87 for those without benefits; and For clerical staff: $13.91 plus 25% fringe benefits, or $17.39 for those without benefits. 3. What about paid prep time for teachers? How is that reflected in the rates? The rates also support a teaching to prep time ratio of 2:1. This results in a “contact hour rate” of $34.77 for teachers, based on a direct service rate of $18.54/classroom hour plus 25% fringe benefits, plus prep time: $23.17 X 1.5 = $34.77/hour. Paid prep time is not required when the hourly rate meets or exceeds the contact hour rate. 4. What rights do part-timers have in regard to workers’ compensation, Social Security, or other public benefits required by law as part of payroll? Part-timers on staff have the same rights as full-timers to workers’ comp, unemployment insurance, social security, social security disability (SSI) and other legally required benefits. Contributions from the employer and employee are based on salary, which is of course pro-rated (lower) for part-timers than full-timers. 5. Can I tell from my paycheck what benefits I’m getting? Health insurance and disability policy benefits aren’t typically listed on paychecks, except deductions for employee contributions, but they must be detailed in a written employee benefits plan and policy available to all employees. Social security (FICA), including social security disability insurance (SSI), unemployment insurance (Federally-funded is called FUTA, state-funded is SUTA) and the unemployment health care surcharge are listed as deductions on paychecks. Workers compensation is an insurance plan covering medical costs and partial pay for work-related injuries or illness, that an employer is required to carry (either self-insured or through an insurance company). You can ask Human Resources or the Director for the policy. 6. What about fringe benefits for part-timers that are offered by employers? The ESE Rate System supports the same fringe rate for part-time as full-time employees (25%). Employers have to pay for benefits as part of the hourly rate, or the 25% fringe add-on, but not both. They are not required to provide benefits to employees at all (except for those listed in 1 above) by either law or ESE policy but must pay the 25% fringe add-on if they don’t. It’s up to the individual program. By law, employers cannot discriminate in benefits in regard to race, religion, gender or national origin. However, Mass. ESE does allow programs they fund to distinguish part-time from full-time (by paying no benefits, and the higher hourly rate, to part-timers). 7. How do I know what benefits I’m entitled to? They should be clearly listed in a written employee benefits plan and policy that must be made available to all employees. It is typically given out at time of hire, but you may ask for a copy at any time, and the employer is required to share it. 8. Does MA ESE require that ABE programs hire part-time teachers? No, that is a decision made by individual ABE programs, often based on convenience, custom (“we’ve always done it this way”), scheduling needs and budget. There is no set percentage of staff required by ESE to be part-time. 9. Do part-timers have to be hired as consultants? No, and there are no minimum hours per week that require you to be considered a consultant. Regular, permanent staff, whether part-time or full-time, should by law be on the payroll, not considered consultants. See below. 10. What is the difference between a contractor, a consultant and an employee? Consultants are paid as “1099” employees (after the IRS form 1099 for consultants.) Regular employees submit a W-4 IRS form to the employer when they are hired, and their tax return is on Form W-2. There is no legal difference between a contractor and a consultant. If you are a contractor or consultant, basically you are self-employed but sell certain services to someone else, as an individual vendor or a business. You set your own hours, provide your own tools and worksite, pay for your own business expenses including work travel and materials, and direct and schedule your own work, and can build these costs into the consultant rate you charge. If you are an employee, the employer directs and controls your work, provides instructions or training, sets work hours, location, and method of work, reimburses business expenses, provides a written employment contract, and deducts payroll taxes. An employee is an hourly, weekly or salaried employee who works regular hours for a specific employer, whether full- or part-time. In general, someone who works regular hours, works in a regular place of employment, uses tools and materials from the employer, and/or has an employer who sets the conditions, pace, location, and terms of the job, is an employee, not a consultant. This provision is frequently violated, either to save an employer money or out of ignorance. Many employers erroneously classify their part-time employees as consultants. If this violation is determined by the Internal Revenue Service (IRS), the employer can be liable for back taxes (Social Security, Unemployment, etc.) plus stiff penalties. It might be in your interest to look into this if you are a regular part-time teacher but paid as a consultant. 11. What are the IRS criteria for consultants as opposed to employees? The above are general criteria; consult IRS publications for details about the 11 IRS criteria. The Internal Revenue Service has a strict definition, with numerous criteria, for who is considered a staff person on payroll, and who is a contractor or consultant. There is a brief brochure describing this called “Independent Contractor or Employee . . .” —IRS Publication #1779 at http://www.irs.gov.* 12. What does Massachusetts state law say about employees vs. consultants? In 2004, the Commonwealth of Massachusetts tightened up its criteria for contractors and consultants vs. regular employees by amending state law for the Department of Revenue (DOR). This state law is much stricter about who qualifies for independent contractor status than the Federal law or previous Massachusetts common law. Massachusetts law now presumes a worker is an employee unless several very specific criteria are met, including: The worker is free from control and direction in the performance of services (that means supervision and direction of how you perform your work) The services are performed outside the usual course of the company’s business; and The worker is customarily engaged in an independently established business. All three of these factors must be met for a worker to be considered an independent contractor. The location where the services are performed is no longer relevant. If you have the same responsibilities as other employees at work, you are probably not correctly classified as a consultant or contractor. Employers can choose to provide certain benefits for employees, but not to contractors (consultants), but they have to follow the law as to who is an employee and who is a consultant or contractor. Penalties can include civil and criminal penalties and multiple damages and attorneys’ fee awards in private litigation.** * You can get more free information from the IRS at: http://www.irs.gov/publications/p15/ar02/htm/#d0e837, pp. 3-8. There are additional details in http://www.irs.gov/pub/irs-pdf-p15a.pdf. The form the employer fills out in response to a complaint about incorrect classification as a contractor or consultant is IRS Form # SS-8, “Determination of Worker Status for Purposes of Federal Employment Taxes and Income Tax Withholding. It is a lengthy questionnaire and provides much guidance about the criteria for contractor vs. employee. More information can be found at www.mass.gov/dor/TIR05-11: “Effect of New Employee Classification Requirements” or G.L.c.14 §6(1); G.L.c.62c§3. St. 2004, c.193, 26. 13. Is it legal to hire part-timers as consultants? Not if they have a regular schedule and meet the other IRS or state criteria. 14. What are the advantages and disadvantages of being hired as a consultant vs. an employee? It may not be in your interest to be considered a consultant vs. an employee. You might want to compare the relative advantages for your work situation. Sometimes employers pay consultants at a significantly higher hourly rate than employees, and this is legal. Consultants are not paid fringe benefits, but the hourly rate sometimes in effect covers those costs. However, consultants are not eligible for employer-paid payroll taxes that provide public benefits, including social security, social security disability, unemployment insurance, workers compensation, as well as fringe benefits. Not having these benefits deducted from your paycheck can result in a larger paycheck, but you give up the employer contribution to them, as well as the right to access these benefits (like Social Security) later on, when you might need them. 15. If I’ve been incorrectly classified as a consultant, what can I do about it? The best thing might be for you, or a group of your co-workers, to bring the Director’s attention to the IRS and Massachusetts regulations. Many Directors do not know about these regulations and are simply making an error. A Director might then just change your status to permanent employee. If it’s not corrected, you could bring a complaint to the IRS or Massachusetts DOR, keeping in mind that that could mean stiff penalties for the program. In general, your job is more legally protected if you are acting in “concerted action,” that is, in a group, than if you go ahead alone. 16. Is there any regulation or law that says how many hours/week qualify you for benefits? No, but there have been unsuccessful recent attempts to change this through state legislation. 17. Who makes decisions about part-timers’ fringe benefits, and what are they based on? It’s generally a management decision, by the Board, Director and/or HR personnel. Some programs “pro-rate” part-timers’ fringe benefits, based on the proportion of weekly hours to full-time hours worked, and some do this for some benefits and not others. Many have a minimum hours/week worked before employees qualify for benefits. This is perfectly legal. 18. How do wages, benefits and part-time status vary among union and non-union programs?** Unionized programs generally pay at a higher rate and are more likely to include fringe benefits for both full- and part-timers, than are other programs. One reason is that most public institutions are unionized and part of a single salary scale in union contracts, and ABE teachers’ salaries and benefits are more comparable to those of other public employees.

WORKERS’ RIGHTS