One of the unintended consequences of the Affordable Care Act (ACA) is that employers have an incentive to drop health coverage for their part-time workers.
The ACA includes a fine for failing to cover full-time workers but includes no such penalty for part-timers (defined as working less than 30 hours a week).
As a result, some employers are either moving to reduce workers’ hours below 30 and/or discontinuing part-time health coverage altogether.
The UFCW strongly supports the Part-Time Worker Bill of Rights which would penalize employers for failing to provide health care to part-timers and thereby end the incentive for dropping workers from their coverage.
Under the ACA, large employers (defined as 50 employees or more) who do not provide health care coverage to full-timers must pay a penalty of $2,000 per fulltime employee per year.
Under the Part-Time Worker Bill of Rights, large employers who do not provide health care coverage to part-time employees must pay a penalty that is pro-rated based on the average hours of service the employee works each month based on 30 hours per week.
If an employee works 15 hours per week, or half of the 30 hours, the employer’s penalty will be half of the $2000 paid for full time employees or $1000.
The bill also extends the following benefits to part-timer workers:
Family and Medical Leave Act—Hours of service requirement dropped so part time workers will be covered.
Employee Retirement Income Security Act —Part-time workers can participate and vest in pension plans.