Transitional employment is a strategy that employers can use to transition employees back into full-time work. It involves starting an employee in a light-duty or part-time role and transitioning them into their full job role over a period of several months. 

Transitional employment is usually offered when an employee is injured on the job and has a worker’s compensation claim.

However, transitional employment can also be offered to employees who are unable to perform their normal duties for other reasons. For example, it may be offered to a new parent who is returning to work after taking parental leave or to a new employee who would benefit from easing into their intended job role over time.

How Does Transitional Employment Work?

Transitional employment works much like temporary employment. Employers offer an employee a time-limited contract for a specific position. However, at the end of the contract, the employee usually returns to their normal job role instead of leaving the company.

Transitional employment positions are usually designed to offer lighter duties than an employee’s normal role. In some cases, transitional employment can also be used to teach employees specific skills.

The goal is to give the employee time to recover or learn before returning them to their original job role. If an employee reaches the end of their transitional employment and is not ready to return to their original role, their contract can be renewed.

Who Qualifies for Transitional Employment?

Transitional employment is not an official job status according to the federal or state governments. Instead, it is a voluntary strategy that employers can use to retain valuable employees, keep up morale, and reduce worker’s compensation costs.

Current employees

Transitional employment is usually offered to current employees who are injured on the job and have a worker’s compensation claim. If these employees accept transitional employment, they should receive compensation for their work and may have their worker’s compensation benefits reduced as a result.

Transitional employment can also be offered to employees who are unable to perform their normal job duties for an extended period for other reasons. For example, a new mother returning to work may be assigned duties that do not involve heavy lifting. An employee who is recovering from a severe illness may be assigned part-time work.

New employees

Employers can also offer transitional employment to individuals who are new to the company. This is a good way to support the local community while also serving as a try-out period for a new employee who could potentially move into full employment later. Individuals who may seek temporary employment with a business include:

  • Formerly incarcerated individuals
  • Formerly or currently homeless individuals
  • Individuals who have been out of the workforce for several years

Employers may also choose to offer transitional employment to individuals who qualify for Temporary Assistance for Needy Families (TANF), a federal anti-poverty program. Typically, this program accepts parents whose income is below the federal poverty line.

Employers can enter into agreements with state-level TANF administrators to offer subsidized employment opportunities to qualifying individuals. The individual gains training and work experience at your company, while some or all of their compensation is paid through the TANF program.

In addition, employers may offer transitional employment to individuals who are currently employed at another company, but want to make a change. This can be because an individual is currently working part-time and wants to transition to full-time employment. It can also be because an individual is not making enough in their current position and wants to earn more in the future.

Examples of Transitional Employment Roles

Employers can decide what transitional job roles they want to offer. Transitional roles can be based on both your business’s needs and the abilities of the employee. Some examples of common transitional employment roles include:

If your business has a specific project that doesn’t fall under any individual employee’s job description, that could also be suitable work for a transitional employee. For example, you could hire a transitional employee to update safety manuals or design new signage for your office.

Why Should Employers Offer Transitional Employment?

Transitional employment has several benefits.

First, it’s good for morale and employee retention. Employees see that when someone is injured or unable to perform their normal duties, your company finds ways to accommodate them and help them get back to work.

Your business also gets to retain the injured or temporarily disabled employee. An employee’s skills or knowledge may still be valuable to your business, even if the employee is working in a different role than they normally perform. 

While in transitional employment, employees can gain new skills. Even if these skills aren’t directly related to their normal job role, they may make that employee more valuable to your company down the line.

In addition, transitional employment can be a mentoring opportunity. Employees who are not normally in supervisory roles can oversee the transitional employee, giving them a chance to gain management experience. Offering management opportunities to more employees can be good for your company culture and your promotion pipeline.

Offering transitional employment for individuals who have been out of the workforce can be a form of community service. Teaching individuals valuable skills that can help them find full-time employment at the end of their contract supports local economic development. If your company mission includes community service or giving back to the community where your business is located, offering transitional employment can be one way to achieve that mission.

You also have the option to hire transitional employees who prove their value. So, transitional employment can become a part of your recruitment strategy.


Transitional employment involves giving an employee light-duty or alternative work until they can take on their full job role. It is often offered to temporarily injured or disabled employees, but can also be offered to help individuals who have been out of work for a long time re-enter the workforce. Transitional employment can be good for employee morale and help employers recruit new talent.