Healthcare Reform - Employee Calculations

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Questions from a recent webinar presentation on Obamacare reform - pay or play provisions - dealing specifically with employee calculations.

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Healthcare Reform - Employee Calculations

  1. 1. Bracing for Impact:What you need to know about health care reform Q & A from Webinar Presentation March 26, 2013 © 2013. All rights reserved. Rea & Associates, Inc .
  2. 2. Questions related toEmployee Calculations -2- © 2013. All rights reserved. Rea & Associates, Inc .
  3. 3. If temporary agency employees work In the case of an individual withonly for the entity and the entity majority ownership in multiplecontrols the schedule and the task, entities, is it most likely that thewill they have to be offered FTEs will be aggregated regardless of entity type and structure?insurance? If the temp agency employs over 50 full- Yes. time employees, and the employees you are referring to are full-time common law employees of the temp agency, absolutely, they will need to be offered coverage. The temp agency can elect to pay one of penalties if they do not “play.” -3- © 2013. All rights reserved. Rea & Associates, Inc .
  4. 4. What about multiemployer collectiveIf you have a part-time employee bargaining agreements? We havewho is scheduled for 25 hours per six different multiemployer plansweek, but picks up extra hours and that provide health care. Do all thesegoes over 30 hours, what happens to employees count for the largethe status of insurance? employer count? If this is a regular occurrence, and they For the large employer count, look at who are full-time after the measurement period the common law employer is. A testing that applies to them, they will be common law employer/employee is a full-time under ACA and will need to be very fact intensive area. offered insurance. Only employers whose businesses are If you have proper measurement periods part of commonly controlled groups have in place, an occasional 40 hour week or to aggregate employees. 130+ month will not be a problem. The key there is you have to have the proper If you know which EIN is the common law policies in place! employer of the workers, and you know how those EINs are related, then you can properly aggregate groups for Large Employer testing. -4- © 2013. All rights reserved. Rea & Associates, Inc .
  5. 5. Can you discuss Amish employees needs briefly? Amish employees (but not employers) have a religious exemption from the requirement to buy health care the same as they have in several other areas of the law. There are existing rules on how this works in other areas which the ACA has adopted. Employers should offer coverage and obtain a waiver from their Amish employees. Amish employers should offer coverage to their employees, assuming they are large employers under ACA. Remember that it takes a full-time worker going to the exchange and buying coverage with a subsidy to trigger the penalties – an Amish employee should not do that (unless they really want health care coverage and are willing to risk the non-tax related consequences I suppose). Note: The religious exemption must be renewed by minors that come of age (18, I believe). Employers should track this and obtain new waivers accordingly. -5- © 2013. All rights reserved. Rea & Associates, Inc .
  6. 6. We are a trucking company and havenever needed to track hours because What happens during elections,we do not fall under the FLSA. How when the Board of Elections hireswill they measure hours for a employees for approximately 1 andtrucker? 1/2 months, 10+ hours day? By actual hours worked. If they are not If that’s all they are employed for, it’s paid on an hourly basis (but by the job), probably not a problem. Remember, there there are the 8 hours/day and 40 is a 90 day administrative waiting period hours/week safe harbors. that you can build into your policies. This might be a great time to talk to an You don’t have to provide, nor can you be external company that has stand-alone penalized, for not providing coverage to options for hour tracking that are proven anyone during their first 90 days. and low cost. If those workers will be employed more The IRS is soliciting comments on how to than 90 days, so long as you have the deal with folks that are obviously full-time proper measurement period established (like pilots), but that have some and they are otherwise not hired to be restrictions on their workday due to other full-time, you will be ok. areas of the law. Truckers, I believe, have similar rest period requirements. -6- © 2013. All rights reserved. Rea & Associates, Inc .
  7. 7. If there are five restaurants under one common holding company withmore than 50 people combined, are they considered a large employer?If yes, what if they were to each be their own separate company, wouldit still apply? In both situations, it sounds like we have common ownership. You would aggregate the employees for purpose of Large Employer testing and it sounds like you would be a large employer. For penalty testing, they would each be considered on a separate company basis. -7- © 2013. All rights reserved. Rea & Associates, Inc .
  8. 8. Are seasonals designed as 120 days We only have to be concerned aboutor can they be defined differently if part-time/full-time if they exceed full-stated as such by our organization? time over the entire measurement period, correct? Seasonal workers are 120 days For purposes of Large Employer maximum, for now, no real flexibility. testing, you look at actual hours by month – measurement periods do not The IRS has solicited comments on other apply/are not applicable. ways of providing a seasonal safe harbor. For penalty testing, to see if someone is full-time or not, you are correct that it is over the whole measurement period. Note: If you hire someone intending them to be full-time, the measurement period rubric doesn’t apply to them – they are simply considered full-time. -8- © 2013. All rights reserved. Rea & Associates, Inc .
  9. 9. Need Clarification? contact: Joe Popp, JD, LLM 614.923.6577 Joseph.Popp@ReaCPA.com © 2013. All rights reserved. Rea & Associates, Inc .

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