The restaurant industry creates an average of 500,000 jobs during the summer months, according to the U.S. Census Bureau’s American Community Survey, making it one of the largest seasonal job creators. In fact, nearly one-third of the restaurant industry workforce are part-year employees.
Having a large temporary workforce poses unique operations challenges for business owners, particularly as it relates to workers’ compensation insurance.
Here are three things you need to know regarding workers’ compensation insurance and seasonal restaurant workers.
All workers need to be classified properly for both payroll and tax purposes. Whether intentional or not, incorrectly classifying workers can result in significant penalties. The IRS provides information and assistance to help business owners correctly classify workers. Your employment attorney can provide additional assistance.
Accurately report payroll
As a restaurant owner, you are required to report all employee remuneration to the IRS, including cash payments and tips. State and federal income taxes, as well as Social Security and Medicare taxes, must be properly withheld based on total wages. Maintaining an accurate payroll is also necessary for your workers’ compensation insurance, since the amount you owe is determined, in part, by your annual payroll. Inaccurate payroll reporting, or paying workers “under the table,” can leave you vulnerable to litigation and fines if a worker is injured. It could also lead to workers’ compensation premium fraud, a serious crime that could result in fines and even jail time.
Safety training is important
In a busy restaurant, there are many potential risks that could result in an employee injury or illness. Wet, greasy kitchen floors make slips, trips and falls among the most common workplace injuries. Using sharp knives and slicers can put workers at risk for a cut or laceration. As tempting as it may be to skip safety training for temporary and seasonal workers, it is not worth the risk to your business or employees.
New employees should be properly trained in all safety procedures, with special attention given to less experienced workers. The restaurant industry hires roughly one-third of all working teenagers in the U.S., many of whom have never held a job before. A survey conducted by EMPLOYERS revealed that 27 percent of small business owners do not offer workplace safety training to student workers.Among those who do, only half (52 percent) require it. Less experienced workers, particularly those in first-time jobs, are more likely to sustain an on-the-job injury. In fact, every seven minutes somewhere in the U.S. a teenager is injured on the job severely enough to be hospitalized.
According to the Occupational Safety and Health Administration (OSHA), businesses that promote a culture of safety can reduce on-the-job accidents and improve business operations and productivity. Doing so requires commitment from management and participation from everyone involved in your business.
Although seasonal employees are temporary by definition, they are still eligible to receive many of the same worker protection benefits as permanent employees. For more information on applicable laws regarding summer workers, consult the Employment Law Guide provided by the U.S. Department of Labor or an employment attorney. Your workers’ compensation insurance carrier may also have additional resources available on providing a safe workplace. Make sure your restaurant stays in compliance when you staff up for the busier summer months.