Generally, U.S. federal law classifies private-sector workers based first on their economic dependence on the employer, such as the amount of control over their work schedules. Federal law further classifies employees based on whether they are subject to overtime pay.
State and local laws also affect the classification of workers for access to particular state benefits. Michigan, for example, requires employers to distinguish employees between full-time and part-time to determine eligibility for sick time benefits under the Paid Medical Leave Act.
Beyond that, employers can adopt a classification strategy that addresses the level of compliance risk they want over their workers, benefits, and company productivity. However, once they outline their classification strategy, companies must enforce it consistently throughout their organization.