Yesterday, in addition to announcing the final regulations to implement the Affordable Care Act, the U.S. Treasury Department announced that it would delay some employer mandate requirements for some employers for one additional year. Treasury had announced last July that it would delay the entire employer mandate until 2015 for all employers. From Treasury’s fact sheet on the announcement:
“To ensure a gradual phase-in and assist the employers to whom the policy does apply, the final rules provide, for 2015, that:
- The employer responsibility provision will generally apply to larger firms with 100 or more full-time employees starting in 2015 and employers with 50 or more full-time employees starting in 2016.
- To avoid a payment for failing to offer health coverage, employers need to offer coverage to 70 percent of their full-time employees in 2015 and 95 percent in 2016 and beyond, helping employers that, for example, may offer coverage to employees with 35 or more hours, but not yet to that fraction of their employees who work 30 to 34 hours.”
In other words, employees with between 50 and 99 full-time equivalent employees will not be required to offer coverage to employees until 2016. Employers with 100 or more full-time equivalent employees will only be required to cover 70 percent of their full-time workforce, down from the original requirement of 95 percent of full-time employees. While this transition relief reflects a desire by the Administration to help businesses better implement the ACA, it does not go far enough to mitigate the enormous impact of the law on franchise businesses. Small businesses with 50 full-time employees or more will still be forced to prepare to comply with the mandate towards the end of 2015.
Although IFA appreciates the partial delay, Congress can take action to effect more significant changes to the employer mandate that will benefit both workers and employers. H.R. 2575, the Save American Workers Act, would restore the traditional definition of full-time employee in the ACA to 40 hours per week, up from the current definition of 30 hours. The legislation recently added four Democratic cosponsors, Reps. Dan Lipinski (D-IL), Jim Matheson (D-UT), Collin Peterson (D-MN) and Kurt Schrader (D-OR) and now has a total of 201 cosponsors. The House Committee on Ways & Means approved the bill on February 4 by a vote of 23-14, and it should receive a vote by the full House of Representatives in the near future. We urge the House of Representatives to vote the Save American Workers Act as soon as possible.
Click here to take action by contacting your Representative to urge support for this crucial legislation.