Maximum Weekly Hours a Student Can Work = 20

Who is a student?

A student is someone taking 6 or more credit hours in a semester.

Why does the University have the 20 hour per week rule for our student employees?

The University utilizes the federal student FICA exemption. This means that the University does not pay Social Security, Medicare or Unemployment taxes on student employees. The student employee also does not pay these taxes.

This saves the employer (department) money on each student employee hired.

For example: . An employee makes a gross amount of $640 in a month ($8 an hour x 20 hours in a week x 4 weeks)

. Without the student FICA exemption the department would pay approximately $50 in benefits for this employee

. Because of the student FICA exemption the department is not responsible for these benefits

What are the consequences of not following the 20 hour rule?

 If students work over 20 hours on a regular basis they could be determined to actually be working as a permanent employee, in which case the employee and the department would have to pay FICA and perhaps retirement retroactively

 The union could get involved and MSU might be found to be in violation of bargaining agreements

Worst case for MSU as a whole:  If MSU were to be found to be abusing the student FICA exemption the University could lose the privilege of utilizing the student FICA exemption

o This would cost the university millions of dollars

When can students work more than 20 hours a week?  Christmas break  Spring break  Summer break What report can be run to monitor student hours?

The Payroll Summary Report in Time Pro:

 Click on the “Reports” button:

 Choose the week you want to run the report  Click the “OK” button

 Click on the “Payroll Summary” title under the “Total Hours” tab  The dates for the week will default in  Click the “OK” button

 A report will populate  Click on the “Students”

Summary

 As a rule, students should not work over 20 hours in a week o Auxiliaries benefits from this by not paying FICA taxes

 If students are regularly working more than 20 hours in a week o They could be found to actually be classified employees and we would have to pay back benefits including FICA, retirement and possibly begin paying insurance benefits o We could be in violation of union contracts and have grievances filed against our department o The University as a whole could lose the FICA exemption

 Occasional student hours over the 20 hour rule are ok: Example: MSU has a football playoff game. We suddenly need students to work concessions, catering, etc. Some of them go over 20 hours this one week. This is not their usual schedule.

 A report will generated by Auxiliary Service each week and emailed: o Who should receive the email? . The upper manager who will then pass the information on? . The direct supervisor plus copy their supervisor(s)?

Other issues unrelated to FICA to remember:

 The work study program allows a student to work up to 20 hours a week. Working in excess of 20 hours could jeopardize the student’s award.

 International students could be deported if they work more than 20 hours a week as it is a violation of their Visa agreement