What Are Part-Time Employees Under a QSEHRA?

QSEHRA rules allow employers to exclude part-time employees, but only with proper documentation. Learn how to classify them using average weekly hours.

Under QSEHRA rules, “part-time employees” are a class of statutorily excludable employees, meaning employers may choose to exclude them from QSEHRA eligibility without violating the “same terms” requirement, provided the exclusion is applied consistently.

Under 25 hours per week: always part-time
Between 25 and 34 hours per week: part-time only if there are other similarly-situated employees who work substantially more hours; otherwise they’re full-time.
- Under the § 105(h) (cafeteria-plan) definition: Part-time employees whose customary weekly employment is less than 35 hours, if other employees in similar work with the same employer (or, if no employees of the employer are in similar work, in similar work in the same industry and location) have substantially more hours. Notwithstanding the preceding sentence, any employee whose customary weekly employment is less than 25 hours may be considered as a part-time employee.
35 hours per week or more: always full-time

How Do You Determine Typical Weekly Hours

When schedules fluctuate week to week, you average over a stable “representative period” to determine each employee’s customary weekly employment:

Choose a representative period — e.g. the most recent 4–12 weeks of actual hours worked (payroll or time-card data).
Compute the average weekly hours over that representative period

Bottom Line:

For QSEHRA purposes, you must use the § 105(h) definition of part-time and document the representative period, data source, and the similarly situated peer group you used to ensure that your classifications are consistent and defensible.

How Do You Determine Typical Weekly Hours

Bottom Line:

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