For businesses with 50 or more full-time employees, the Affordable Care Act (ACA) is top of mind. While penalties under the Employer Mandate were delayed until 2015/2016, the implementation process is well underway. The critical first steps include tracking and cataloging every employee. Before getting too far down the pike, let’s revisit the stipulations of ACA, and what organizations need to know to avoid risk and maintain compliance.
The best defense is a good offense. Employers who arm themselves with the knowledge to properly manage the ACA implementation process will ultimately protect themselves against expensive penalties and long-term repercussions. Let's start with the basics.
Shared Responsibility to Employers
One of the most confusing aspects of the ACA is the requirement to classify employees and then track their eligibility. The concept is simple if your workforce is comprised of traditional, full-time employees who are already working, have predictable, stable schedules and make a certain wage. But with all the variations of workers, it can be dizzying to figure out who is in and who is out.
Getting a system in place is key to streamlining this process. Here are some of the considerations that we took directly from the Obamacare site:
- The employer mandate is based on full-time equivalent employees, not just full-time employees.
- Employees who work at least 30 hours per week, or whose service hours equal at least 130 hours a month, for more than 120 days in a year are considered full-time.
- For employers who don’t provide coverage the fee is $2,000 per full-time employee (minus first 30 full-time employees).
- For employers who do provide coverage, but that coverage doesn’t provide minimum value or isn’t affordable, the fee is the lesser of: $3,000 per full-time employee receiving subsidy, or $2,000 per full-time employee (minus the first 30).
As you can see, it's not straight forward, but with the proper tracking mechanisms in place, you can ensure compliance. Its likely that HR teams are leading the charge administering new programs and answering employee questions, but for smaller organizations, this proves to be challenging. It’s all a lot of work and this is just the beginning.
Understanding the ACA: The Webinar
Noted expert on the ACA and employment law, Alden Bianchi of law firm Mintz Levin, provided this exclusive and comprehensive webinar on the ACA and its implications to the future workforce. In addition to defining the varying employee types, Alden walked webinar attendees through what they could expect and how to prepare for the long road ahead.
- Definitions of the individual mandate and essential minimum coverage
- Determining full-time employee status
- Important look-back measurement methods and changes in status
- Responsibilites for temporary employees
- Waiting period regulations
- Plan-level and employer reporting regulations
The most important pieces to keep in mind right now are how your organization is tracking and measuring employees. While no one really knows how the government will handle reporting and enforcement, luck favors the prepared. And with changes in the House and Senate, the question becomes: Will the ACA change and if so, how?
This blog was written by Matt Rivera. Matt serves as Vice President, Marketing and Communications and is responsible for overseeing all aspects of Yoh’s marketing and brand communications. Matt holds a degree in Journalism/Public Relations and has been working in the staffing industry for more than 25 years. Prior to this role, Matt held many different roles from branch recruiting and proposal writing to technology management and online marketing.