The employer mandate in the Affordable Care Act has businesses scratching their heads.
As the IRS attempts to interpret the employer mandate, more questions are being raised, including how the requirement will impact small businesses, The New York Times reports. The Obama administration says it will push back enforcement for a year, in part to give the agency more time to decipher the regulations.
One of the biggest issues is how a business would figure out if workers with fluctuating hours need to be offered health insurance. While the Act says any employee working 30 hours a week must be offered insurance, some businesses have scheduling that gives an employee 25 hours one week but 35 the next. The IRS is approaching this scenario with a “look-back measurement method,” in which the company would pick between three months to a year and average the worker’s weekly hours.
“I think they understood clearly that in the retail and chain restaurant industries, employees will often not fall into neat full- and part-time categories,” said Neil Trautwein, employee benefits policy counsel at the National Retail Federation, which worked with the agency on developing the method. “Once you get away from manufacturing, it’s not an uncommon problem in the business world.”
The rules are murkier still as to what happens when a worker moves from full time to part time. “Do you get to keep your coverage?” said J.D. Piro, senior vice president at Aon Hewitt. “Or do you follow the Cobra rules? … “That’s what employers need guidance on — which rules take precedence.” NACS Online