Content updated May 30, 2018

In its regulations for enforcing the Affordable Care Act, the IRS singles out three situations of unpaid absence from the job that all employers who must be ACA-compliant need to take into account when tracking an employee’s eligibility for health insurance:

  • Absence to serve on a jury

  • Absence under the Family and Medical Leave Act of 1993 (FMLA)

  • Absence under the Uniformed Services Employment and Reemployment Rights Act of 1994 (USERRA)

 

When using the Look-Back measurement method to determine full-time status, the IRS allows employers to use one of these two methods of calculating averages to account for this time:

  • METHOD 1: Look only at the time worked and base the 30-hour threshold on that time.

  • METHOD 2: Credit the employee with hours as if they had worked during this unpaid time.

 

Integrity Data’s ACA Compliance Solution uses Method 2, crediting hours as if the employee had worked that time. We have found that Method 2 creates less confusion by equalizing all employee hours.

The averaging calculation for either not penalizing the employee or crediting them with hours, as if they had worked, is the same for all three absences.

The important factor to note is that the results of either method will always be identical for determining the average hours per week.