As we start this new year, many businesses are considering making changes to drive growth. While you might consider hiring new talent to keep up with these changes, be aware that when your headcount hits a certain number, there will likely be new legislation to consider. The Affordable Care Act (ACA), for example, triggers compliance with the 50th hire or full time equivalent (FTE). Be sure you have the technology in place to support legislative compliance as business grows.
Growth is great; however, it isn’t without risk. As discussed in “Compliance issues as you near the 50-person mark, other growth stages,” posted by Jayne Gest on SBNOnline.com, an increase in headcount also results in an increase in regulatory compliance obligations. Here are three examples when headcount triggers compliance changes and what you should do to be prepared:
- ACA Compliance: At 50 employees, or FTEs, businesses must comply with the ACA. You must capture data showing employees are offered affordable health insurance, and prepare detailed reports to employees and the IRS by established deadlines. Penalties are steep for noncompliance.
- Family Medical Leave Act (FMLA): With the 50th hire, employers must offer employees up to 12 weeks of unpaid, job-protected leave each year.
- Benefit plan reporting: Form 5500 comes into play when the headcount reaches 50 for benefit plans subject to the Employee Retirement Income Security Act of 1974. There is a short form for businesses with 50-100 employees and a longer form for over 100 employees.
With as few as 10 employees, businesses are subject to the Occupational Safety and Health Act. The Americans with Disabilities Act (ADA) is triggered at 15 employees and COBRA kicks in at 20 employees. At each stage of growth, businesses should seek guidance from their payroll provider, attorney, or human resources and/or benefits professionals.
Be Prepared for Regulatory Compliance by Deploying the Right Technology
Knowing which regulations are triggered is just the first step. Businesses must put the right technology in place to support compliance efforts. Paper-based processes are too time-consuming and risky for managing ACA compliance or benefit programs. Modern management solutions like the ACA Compliance solution and Comprehensive Leave Manager can streamline data-entry and reporting. Automating tasks strengthens compliance efforts without distracting your team from other core business operations. Contact Integrity Data for help putting the technology in place that will support regulatory compliance measures you must take as your business grows.
By Integrity Data, ACA Compliance Solution Provider out of Illinois