Your Responsibility: How Does the Healthcare Law Affect You?
The healthcare reform law poses a lot of challenges for the hospitality industry. ORLA's Healthcare Resource Center
will help you navigate the intricacies of the law.
You can read the Affordable Care Act in its entirety at HealthCare.gov
or review the frequently asked questions and answers prepared by our
own healthcare expert, Garth Rouse of ORLA-endorsed Garth Rouse &
Associates. Before implementing any benefit changes please consult a
professional specializing in this field as this law is continuously
changing and evolving.
The ACA treats large employers (with less than 50 employees) much differently
than small employers (those with over 50 employees), so understanding the effects of this
legislation is predicated on knowing how many employees you have and how
the government counts these employees.
How to Determine Your Size: Calculate Your FTEs
You must count part time employees toward the total number (seasonal
employees can be taken out of the total as long as they work 120 days or
less during the year). These employees are referred to as Full Time
Equivalent (FTE) employees.
The time period used when answering the questions below is called the
“Measurement Period.” The measurement period is chosen by the employer
and can be from 3 to 12 months. The example below assumes a 12-month
___ A. Number of full time employees (30 hours or more per week)
___ B. Total hours worked annually by part time employees (under 30 hours per week)
___ C. Divide total in Line B by 12 (months in a year)
___ D. Divide amount in Line C by 120 (hours in a month @ 30 per week)
___ E. Add number from Line A to number in Line D. This is your total number of FTEs..
If column E is at or above 50, then you are considered a “large
employer” and are subject to the large employer “play or pay penalties.”
Remember, if you have controlling interest in more than one business you
will need to count the employees of each company as if they were all
covered under one.
You are generally considered a small employer if you’ve got less than 50 FTEs, with which the law’s impact on your business will likely be minimal. You are not required to offer healthcare coverage to your employees. If you do, you may qualify for the Small Business Healthcare Tax Credit to help you pay for it.
about the law's impact on small employers, review the Small Employer FAQs
, and see if you may qualify for a tax credit.
You are generally considered a large employer if you have 50 or more employees, whereby you must offer minimum coverage to all of your full-time workers or pay penalties. Even though part-time and most seasonal workers are included in the FTE calculation, you are only required to offer coverage to full-time salaried and hourly workers.
Read more about large employers' responsibilities, review the Large Employer FAQs, and learn more about penalties and reporting.