The Internal Revenue Service recently issued proposed regulations that provide employers with guidance with respect to the shared responsibility regarding employee health coverage. It is these provisions that will determine if an employer must provide insurance coverage or pay a penalty. The proposed regulations affect only employers that meet the definition of a large employer (50 or more FTEs). The regulations cover, among other areas, how to determine large employer status, application of aggregation rules, successor employers, seasonal workers, and full-time equivalent employees. Also addressed is how to treat teachers, commissioned employees, adjunct faculty, and transportation employees. There is significant guidance on the “look back measurement method,” which is used to determine whether ongoing, new, variable-hour, and seasonal employees qualify as full-time employees. Employers may rely on these proposed regulations for guidance pending the issuance of final regulations or other applicable guidance.

These regulations are important to all employers, but of particular import to large employers with variable-hour and seasonal work forces. It certainly appears these regulations will require a great deal of study to implement. Employers may want to consult with their advisors to determine how these rules may affect them.  

The proposed rule may be found at the following link:

https://federalregister.gov/a/2012-31269

Employers with large seasonal and variable-hour work forces should look closely at these regulations and submit comments if there is a particular area that will substantially affect their business.

Comments are due on or before March 18, 2013.

(1) Electronically. You may submit electronic comments via the Federal eRulemaking Portal at https://www.regulations.gov (IRS REG-138006-12).

(2) By regular mail. You may mail written comments CC:PA:LPD:PR (REG-138006-12), Internal Revenue Service, Room 5203, POB 7604, Ben Franklin Station, Washington, DC 20044.

(3) Hand Delivery. Submissions may be hand-delivered Monday through Friday between the hours of 8 a.m. and 4 p.m. to CC:PA:LPD:PR (REG-138006-12), Courier's Desk, Internal Revenue Service, 1111 Constitution Avenue NW, Washington, DC.

A public hearing will be held on April 28, 2013, 10:00 a.m. in the Auditorium, Internal Revenue Building, 1111 Constitution Avenue NW, Washington, DC.

For more information about the Affordable Healthcare Act, contact Gesina (Ena) Seiler at 608.283.6787 or gseiler@axley.com.

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