Employee Absenteeism and the ACA: Measures to Aid Compliance
The Affordable Care Act (ACA) is a complex piece of legislation that has certainly complicated processes for HR departments across America. In particular, reconciling employee absenteeism and the ACA involves a multifaceted effort from a variety of stakeholders, especially when dealing with a variable workforce. It is incumbent upon the CHRO to implement strategies that ensure compliance from a federal level but don't upend the talent management and retention frameworks already in place.
So what can you do to weather the ACA storm and still maintain the processes and procedures that make your organization a success?
Here are three areas to focus on to help keep you on the path toward compliance:
1. Determine the Accuracy of Data
Under the ACA regulations, a large employer (those with more than 50 full-time and full-time equivalent employees) must determine an employee's full-time status based on hours worked as well as hours for which an employee is entitled to payment: holiday, incapacity, illness, leave of absence, military service or jury duty.
A full-time employee is defined as one who performs an average of 30 or more hours of service per week or 130 hours per month, including paid time-off or leave. The process to determine who is eligible for ACA benefits will invariably impact both payroll and HR, particularly when it pertains to employee absenteeism.
Clearly, the number of hours worked is critical, and the accuracy of the data must be quantifiable. Therefore, it becomes essential to track both scheduled and actual hours worked within an agreed time frame. To help achieve accuracy, consider installing an automated system to provide precise timekeeping, alerts and forecasts, which could serve to help eliminate compliance errors.
2. Educate Your Employees
A study by Aflac found that approximately 75 percent of workers think their employer will educate them about health care coverage. A training session on the nuances of employee absenteeism and the ACA may benefit your entire workforce, regardless of whether they are full time. You should also use these sessions to help employees understand the subtleties between the different types of absenteeism.
3. Draft Policy About Unpaid Leave
Monitoring employee special unpaid leave during the corresponding measurement period is another aspect of critical importance in your compliance efforts. Per the IRS, the employer shared responsibility rules state that "special unpaid leave" may be defined as unpaid leave under the Uniformed Services Employment and Reemployment Rights Act of 1994, the Family and Medical Leave Act of 1993 or jury duty.
Therefore, when determining hours of service for a measurement period, the organization must either exclude any periods of special leave when they determine the average for the period or input the average weekly rate of service to cover the leave period. Either way, it's crucial that these measurements are accurate, especially as any employees who do not average 30 hours of service per week or 130 hours per calendar month are not required to be offered employer benefits under the ACA rules or pay a penalty.
Complications with this element of the process could have larger implications for staff morale and employee engagement. The accuracy in the reports remains important because compliance hinges on knowing which and how many employees should be offered employer benefits. HR must acknowledge this and ensure that they are giving the necessary information to employees as well as receiving the appropriate documentation from employees.
In the end, no matter how complex the process or what that process entails, employees want to know you are keeping accurate track of their hours and any absenteeism to ensure that they are classified correctly.
