Most employees and businesses have often considered ‘full-time’ to mean a traditional 40-hour work week. However, for the purposes of the Affordable Care Act (ACA) reporting, the definition of ‘full-time employee’ has been reclassified to 30 hours of service per week. In addition, employers must also calculate and include the hours of service which may include jury duty, holiday, vacation time, other leaves of absence, and much more. The guidelines for classifying an employee as full-time aren’t so simple anymore.
The ACA is a large, complicated piece of legislation that largely rests on the number of employees a business employs and that meet the ACA definition of ‘full-time employee’ (or FTE). To make this determination, an employer must also understand two new definitions:
- Hours of service: Employers must track the number of ‘hours of service’ which includes the hours an employee is paid on the job or while on vacation, sick or during a holiday. In addition, the employer must track the hours an employee is available to the employer which could be, for example, unpaid on-call hours.
- Full-time: A full-time employee works the equivalent of 30 hours of service per week, or 130 hours of service in a month.
Employers must track every employee’s hours of service on a monthly basis, regardless of whether the employee is salaried or paid hourly. Although employers may not pay employees for jury duty, military deployment or FMLA absence, those hours of service must be credited as if they had worked and these absences can’t be used against the employee when calculating eligibility. On-call employees must also be credited for time if:
- Payment is made for on-call hours
- Employee is required to remain on the job site during on-call hours
- Employee activities while on call are restricted, preventing the employee from using this time for their own purposes
There are other nuances for crediting time to an employee without tracking hours, for example, in the case of commission-only sales professionals, pieceworkers or adjunct faculty. In addition, employees that are shared between controlled corporations or affiliated groups must be treated as employees of a single entity.
Watch our on-demand webinar to learn more about ACA compliance tracking and reporting. You can also download information about Integrity Data’s ACA Compliance Solution, an easy-to-use solution that can provide greater control over compliance activities. Then, contact the experts at Integrity Data for additional guidance and support with your ACA compliance efforts.
By Integrity Data, ACA Solution Provider