Time Keeping to Comply with the ACA
“Change is inevitable. Growth is optional.”
~ John C. Maxwell
Anyone who runs a business is likely painfully aware of the main catalyst for change these days: The Affordable Care Act (ACA). Since the 1st of January, the nation’s attention has been aptly turned toward ACA and how it fares in execution. In the business world, the focus has been more on how ACA will affect the day to day of running a company. If you still have questions, you’re in the right place.
Understanding the ACA Employer Mandate
The ACA Employer Mandate requires all businesses with over 50 full-time equivalent employees to provide insurance for those employees. Those who don’t comply will be expected to pay a fine dubbed the “Employer Shared Responsibility Payment” for each full-time equivalent employee after 30 in the amount of $2,000 to $3,000. So if a company has 60 employees and does not provide insurance, their end of year penalty will be between $60,000 and $90,000.
When Does Enforcement Begin?
ACA went into effect on January 1st of 2014, but President Obama has since delayed enforcement and reporting requirements on the Employer Mandate in order to allow businesses the opportunity to create and institute new protocols for remaining in compliance. All small business with 50-99 full-time equivalent employees will be expected to start insuring workers by 2016. Larger business, with over 100 full-time equivalent employees, will need to begin working towards compliance in 2015.
What Constitutes a Full-Time Equivalent Employee?
For the purposes of the ACA mandate, a full time equivalent employee is one that works at least 130 hours during the month. Now, the IRS does recognize that employee status may change from month to month on this basis, so they are allowing companies to establish a 3- to 12-month “look back” period in order to determine average monthly hours worked. Those that don’t meet the 130-hour monthly average can be removed from benefits. But monitoring and reporting those hours is going to require careful tracking – something most companies aren’t currently set up for.
How Can Allevity Help?
Allevity is already working to ensure the healthcare plans provided to our business partners are in compliance with the new ACA regulations. But that’s not where our benefits to your organization end. We offer time tracking software that can ensure accurate information is being provided about employee hours as well as employee status. Gone are the days when you can rely on employee reporting for time tracking. Why not use a software that tracks hours by date and has the ability to total hours across certain date ranges? With the new ACA requirements, you need a system on your side that can provide comprehensive auditing and deliver timely reporting.
Remaining in compliance means adjusting with the changes and altering the way you do business. Allevity can help. But it all comes back to remembering that change is inevitable, growth is optional.
Is your company ready to grow amidst the changes?