Affordable Care Act Impacts on Employers: Guidelines & Penalties

1. Affordable Care Act Impacts • Requires employers and employees to share responsibility in making sure individuals have health insurance. • Requires employers to report to employees and the IRS on employees’ health insurance.

2. Employer Penalties • Offer health insurance for employees and dependents to 95% of their full time staff. (Penalty A) • 1/12(all FT – 30) x $2,000 • FY 2015 Transition. 70% compliance • Offer affordable, valuable health insurance to full time employees and their dependents. (Penalty B) • 1/12(each skipped FT) x $3,000

3. Full Time Definition • Works on average 30 hours per week or more. • Or Works on average 130 hours per month or more. • Usually determined at time of hire, but may apply to other categories subject to measurement. • Variable Hour Workers – • Regular Status Part Time • Temporary Workers • On Call Workers • Seasonal Workers

4. What Time is Measurable? • Hours worked • Paid Time Off; each hour the employee is paid or entitled to payment for periods of time including • Vacation • Holiday • Illness • Disability • Jury Duty, • Military Duty • Leave of Absence

5. Measurement Period • One year measurement period will be used to define FT status • One month administrative period will be used to enroll those found to be FT • One year stability period would apply.

6. Seasonal Workers • Work for 120 days or less • Are included in Assessment to determine if FT for offering health insurance. • If leave for 13 consecutive weeks or more considered new employee when return. • If leave for more than 4 consecutive weeks but less than 13 apply rule of parity • If period of absence is longer than immediately preceding employment period, may treat as new hire upon return to employment.

7. Snow Plow Operator Example • Hired November 1 • Works 60 hours a week for 3 months. • 720 hours/12 months = 60 avg per month during the year. Not FT • Hired November 1 • Works 60 hours a week for 3 months and then 25 hours a week in maintenance shop. • 720 + 900 = 1620/12 = 135 avg per month = FT.

8. Recreation Example • Hired August 1 • Works 50 hours a week for 6 weeks • No other work in year • 50x6 = 300/12 = 25 hrs monthly avg not FT • Hired August 1 • Works 50 hours a week for 6 weeks • Then works 29 hours a week for 46 weeks • = 300 +1,334 = 1,634/12 = 136 monthly avg = FT

9. Admin Example • Hired February 1 • Works 50 hours a week for Dept. 1 for 6 months. • Then 19 hours a week for Dept. 2 for 6 months. • 1,200 + 456 = 1656/12 = 138 avg monthly hrs = FT • Hired Feb 1 • Works 19 hours a week for Dept. 1 for 6 months • Works 30 hours a week for Dept 2 for 6 months. • 456 + 720 = 1,176/12 = 98 avg monthly hrs not FT

10. Support from HR • We will create monthly report to departments on all ongoing variable/seasonal employees • It is important that departments partner with HR to monitor proactively. • Variable/Seasonal Workers that become defined FT must be offered benefits. • Their hours total among all departments. • There is additional cost to benefits • There is additional cost if employee skipped and penalty assessed.

11. Guidelines for ACA Compliance • Set Policy on Temp/Seasonal Use • Measure whether Temp/Seasonal workers are FT for benefits. • Automatically enroll employees determined FT • Document when health insurance offered • Obtain signed waiver when health insurance declined by an employee.

12. Simple Rules for Temp/Seasonal Workers • Depts can hire temp staff to work 29 hours per week or less for up to 6 months. • Depts can hire temp staff to work 129 hours or less per month for up to 6 months. • Depts may hire double the number of existing temp staff to work up to 20 hours per week. • Depts may use a staffing agency to hire temp workers up to full time. • Depts may hire staff to work temporary on call, but will be monitored and should not exceed 29 hours per week.

13. Temp Agency Issues • Temp agencies subject to ACA penalties too and may raise rates. • Must provide health insurance to employees working 30 hours avg per week or 130 hours avg per month. • Temp agency must provide workers’ compensation insurance. • Temp agency must provide safety training for job workers are placed in.

14. Workers’ Compensation Changes • General Employer Rule under OSHA means • Hiring party also citable for temp agency workers. • This recently expanded. • Hiring party now also responsible to ensure temp workers have safety training for their job. • Hiring party must now also report injury to a temp worker on their OSHA 300 log although temp agency carries the workers’ compensation insurance.

15. Temp Worker’s Compensation Implications • Departments should obtain verification of safety training from temps before allowing them to work. • Alternative; send to NEO safety training, and provide department specific safety training as well. • Document dept. safety training done with temp workers. • Fill in accident report on temp workers and send to HR as well as temp agency. Note that it is for a temp worker.

16. Questions? • Seeking feedback on implications among departments. • Recognize there may be unique scenarios • Looking to build a policy that addresses ACA and your dept. needs.