The Affordable Care Act requirement that employers provide health insurance to their workers was supposed to take effect with the start of the new year. But exactly which businesses fall under this employer mandate is far from certain. At issue: Just how many hours qualify for full-time work?
The law puts the cutoff point at 30 hours per week. And that mandate to provide insurance applies only to businesses with 50 or more full-time workers. Although that requirement was initially scheduled to start when the law took effect in 2014, business groups and staffing associations secured a one-year delay so that they would have more time to determine how to comply with the ACA. Now it looks like some of those requirements could change.
Regardless of how a full-time workweek ends up being defined, staffing firms will face challenges understanding and complying with any insurance requirements. For staffing firms, the total number of employees and the hours they work are fluid numbers that are influenced by the staffing demands of clients.
Under the ACA, staffing firms determine a worker’s status by calculating their average number of hours worked. But what happens when the employee is temporary? What if the number of hours they work varies widely from month to month, or year to year? These are the kinds of questions staffing firms should be seeking the answers to in order to make sure they’re fully compliant.
It’s important for staffing firms to understand the ACA, even as legislative debates suggest possible changes to the requirements. As the law stands now, a staffing firm of more than 50 full-time workers – however they’re defined – but no health insurance plan could be subject to a penalty of up to $2,000 per employee – perhaps more per employee than what it might cost to provide insurance.