Emotions, discord and confusion over the Affordable Care Act have run high since its passage in 2010.
Restaurant owners and operators want to offer health insurance to their employees, and in fact, a majority of them did before the ACA became law. Today, most know that offering insurance is a critical recruiting and retention tool, but its cost and time constraints are difficult to navigate. That’s why we’re working hard to help Congress reform the law.
As we work with members on both sides of the aisle, here are five concerns associated with the current health care law:
1. Most employees aren’t enrolled in employment-based plans
The “employer mandate” has resulted in fewer restaurant employees choosing their employer-sponsored health insurance. In 2015, only 59 percent of restaurant employees with health insurance were covered through an employment-based plan, down sharply from 67 percent in 2010.
2. Managing employee benefits is extremely time consuming
Operators now spend hundreds of additional administrative hours managing, tracking and delivering health care benefits to their employees. But the added time, money and resources haven’t improved the quality of health insurance offered to employees.
3. The 30-hour workweek isn’t full time
Ask anyone how many hours make a full-time workweek, and they will tell you 40, but the law inexplicably defines it as 30 hours. This results in mountains of paperwork and IRS reporting requirements that are confusing for employers, especially restaurants, where flexible scheduling is an industry hallmark.
4. Defining seasonal workers as full-time employees
The ACA contradicts itself in its definition of a seasonal worker. For restaurant operators whose workforces expand and shrink throughout the year, it’s especially confusing to determine whether they qualify as having more than 50 full-time employees. That would require them to comply with the employer mandate and reporting requirements.
5. Penalties are high
Most people are aware that the employer mandate requires employers with more than 50 employees to offer health insurance to their full-time employees or pay a fine. But most people don’t realize an employer could receive a total of four fines for not offering the right type of health insurance – and for not telling the IRS who they offer health insurance coverage to.
If a restaurant with more than 50 employees accidentally misclassifies a worker, misinforms their employees and inaccurately reports to the IRS, they could face massive tax penalties – up to $6 million dollars in some cases.
The National Restaurant Association is advocating for commonsense changes to reduce the unnecessary burdens related to the Affordable Care Act. We believe that easy legislative and administrative actions could be taken to make the ACA work for all Americans.
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