TAKING THE PAIN OUT OF HEALTH INSURANCE
Under the Affordable Care Act (ACA), employers with more than 50 full-time employees are subject to employer-shared responsibility provisions and employer information reporting provisions regarding health insurance and employee benefits. Calculating whether you are an Applicable Large Employer (ALE) is complex, but the IRS does offer an estimator than can help you calculate your employees and responsibility. Having a basic understanding of how employees are counted can help you plan and adjust for the future.
Full-Time Employees
The first step in determining ALE status is to calculate full-time employees. In general, these are the key factors:
Typically, you count full-time employees for each month worked.
Exceptions to Full-Time Employees
Seasonal workers and employees who have coverage through a VA health program aren’t counted when determining an employer’s ALE status. Seasonal workers are defined by Department of Labor, but typically include retail workers who are only employed during the holiday season or employees who are hired for the summer.
You should note that in determining ALE status, all employees are counted with the exception of those above, regardless of whether the employees can get other coverage, including but not limited to these sources:
Federally recognized Indian tribe
Determine Your Workforce Size
The size of your workforce in the previous calendar year determines whether you are an ALE in the current calendar year. The number of full-time employees you have in 2018 is counted towards your 2019 determination. To determine your workforce size, count the number of full-time (and equivalents) employees you had each month. Add those numbers up. Divide the total by 12 to get your average workforce size. If it’s more than 50, then your business is responsible for the two provisions.
Ask for Professional HR Assistance
Health insurance can be a complex minefield, but it doesn’t have to be difficult. Even if your organization doesn’t have a dedicated HR person, you can find help with Sackett Insurance. For more information about ACA compliance, contact us online,like us on Facebook, find us on LinkedIn and subscribe to our blog.
Taking The Pain Out Of Health Insurance
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