There are no federal laws defining how long an employee can be considered “temporary.” The time frame can vary based on an organization’s budget considerations and business needs.
Best practices for temporary employees include setting clear parameters for the time frame, pay rate, work schedule, and work expectations. Any potential changes in these parameters should also be clearly communicated.
From a payroll perspective, there is really no difference between a ‘temporary’ vs. ‘permanent’ employee apart from some benefits that may require some sort of waiting period (i.e. 401(k), PTO, etc.). All employees need to be onboarded with all necessary paperwork (W-4, I-9, etc.) and paid through the payroll system.
When examining whether or not to put someone on payroll (employee) or paying them as a subcontractor (1099), there are few things to consider:
- Behavioral Control
- Financial Control
- Relationship to the parties
You can read more about independent contractor vs employee here.