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Hiring former exempt employee at hourly rate
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Hiring former exempt employee at hourly rate
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We are in Washington state and have an exempt employee that will soon be leaving the company. If we rehire him after his termination date to train his replacement, can we pay him hourly without jeopar
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Forums  »  Topic Forums  »  Benefits & Compensation  »  Hiring former exempt employee at hourly rate

Hiring former exempt employee at hourly rate

posted at 7/28/2010 11:22 AM EDT
Posts: 1
First: 7/28/2010
Last: 7/28/2010
We are in Washington state and have an exempt employee that will soon be leaving the company. If we rehire him after his termination date to train his replacement, can we pay him hourly without jeopardizing the exempt status of that position? The wages may exceed $455 per week.
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Hiring former exempt employee at hourly rate

posted at 7/28/2010 12:27 PM EDT
Posts: 562
First: 11/12/2009
Last: 9/14/2011
Hire him back as a contractor instead of an employee if you're concerned about jeopardizing the exemption.
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Hiring former exempt employee at hourly rate

posted at 7/30/2010 5:46 AM EDT
Posts: 2442
First: 2/12/2000
Last: 9/14/2011
If you hire him back as a contractor you will still likely be paying hourly so not sure that helps. If the person is not going to work more than 40 hours a week when you bring him back then exempt status is probably not a real issue.

What can be a real issue is bringing back a former employee as a contractor and avoiding their participation in benefit plans, SS match, worker's comp etc. IRS does not like this solution.
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Hiring former exempt employee at hourly rate

posted at 7/30/2010 8:05 AM EDT
Posts: 562
First: 11/12/2009
Last: 9/14/2011
The IRS would certainly not look favorably upon it if the part time employment lasted for any significant period of time. A month or so probably won't matter much.

However, good point about the benefits.
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