Date: September 2013
As part of the Patient Protection and Affordable Care Act (“Obamacare”), health insurance marketplaces will become available for individuals and small businesses on October 1, 2013. On that date, individuals and small businesses may create an insurance marketplace account and learn the health insurance options available to them.
By October 1, 2013, any employer subject to the Fair Labor Standards Act governing minimum wage and overtime (which most employers with even one employee are) must give written notice to every employee to inform them:
- of the existence of the new health insurance marketplace, the services provided, and the manner in which the employee may contact the marketplace
- that, if the employee purchases a qualified health plan through the marketplace, the employee may lose the employer contribution (if any) to any health benefits plan offered by the employer, and all or a portion of such contribution may be excludable from income for federal income tax purposes.
that, depending on their income and what coverage may be offered by the employer, employees may be able to purchase lower cost private insurance in the marketplace; and
Fortunately, you don’t have to compose the notice; the U.S. Department of Labor offers model notices for employers who (a) currently offer health insurance to some or all employees and (b) currently do not offer health insurance to employees. The notice may be provided by first-class mail, or electronically if the requirements of 29 CFR 2520.104b-1(c) are met (those requirements deal mainly with confidentiality and ensuring receipt). For employees who begin their employment after October 1, 2013, the notice must be provided to them within 14 days of their starting date.
Initially, many employers were concerned that the general $100-per-day fine for non-compliance with Obamacare would apply to the notice requirement. That should not be a concern; on September 12, 2013, the Labor Department announced that failure to comply with the notice requirement will not result in a penalty or fine. Although it is now clear that there is no financial or legal consequence for failure to comply with the notice requirement, employers are encouraged and expected to voluntarily comply.
Social Networking and the Workplace Prepare Now for the Obamacare Employer Mandate Unique Legal Issues Affect Employers on Arizona Indian Reservations OSHA Clash with State Safety Regulators a Concern to Employers Restrictive Covenants in Employment Agreement Found to Be Too Broad Confidentiality in Investigations: A Trap for Unwary Employers? The Affordable Care Act: Things to Know for 2011 U.S. Supreme Court Upholds Arizona’s Employer Sanctions Law Avoiding The Threat of Genetic Discrimination Court Suspends NLRB-Required Notice of Collective Bargaining Rights The Fair Labor Standards Act Accommodating Pregnant Employees IRS Program Offers Employers a Break for Misclassifying Workers Employee Voting Rights: Arizona Employer Obligations Obamacare Update: Employer Mandate Pushed Back to 2015 Supreme Court Decides Cases in Favor of Employers Reducing the Risk of Wrongful Termination Employers, Large or Small: Obamacare Requires Action by October 1 Minimum Wage: Don’t Overlook Arizona’s Higher Requirement FMLA: Communicating with Employees on Leave NLRB Takes Aim at Employee Handbooks