Human Resources Relief: Obamacare Delayed For One Year

The Treasury Department announced on July 2 that it would be delaying enforcement of a key provision in the Affordable Care Act (“Obamacare”), while simultaneously throwing HR departments across the country a life line. The White House said it will not require employers with 50 or more full-time workers to provide health insurance until 2015. The provision, also known as the “employer mandate,” was set to take effect on January 1 this coming year. Employers who failed to provide insurance to eligible workers would have faced fines upwards of $3,000 per employee. All other provisions, including penalties for doctors who failed to espouse electronic medical records, remain intact.

The mandate would have had minimal effect even if it were rolled out in 2014. Ninety-six percent of businesses with more than 50 employees already provide insurance, according to the New York Times. But that still leaves about 10,000 businesses with more than 100,000 employees in limbo.

Hiring Not Affected

June unemployment was 7.8 percent, according to the Bureau Of Labor Statistics. This is down significantly from the 8.4 percent rate in June 2012, but experts say the delay in implementing the employer mandate is unlikely to spark hiring. David Lewis of OperationsInc, a human resources consulting firm, told Reuters that the delay is simply prolonging the inevitable. Bob Mayer, the vice president of HR at Weis Builders, said his company is hiring, but it has nothing to do with the mandate delay and everything to do with his company’s needs. Larger companies like Lifelock.com and Facebook are also hiring due to operational needs.

Several large chain restaurants have been hiring throughout the year, but only part-time employees who are not eligible for coverage under the new law. Wal-Mart, the nation’s largest private employer, says it is still evaluating what, if any, actions it will have to take as a result of the delay.

Employee Reprieve

The one-year delay may buy hundreds of thousands of workers at least one more year of full-time hours. The Shelbyville Central School District in Indiana will be cutting 100 employees’ hours to avoid having to offer them insurance under “Obamacare,” according to the Indianapolis Star. Dearborne, Mich. instituted a similar policy on April 1 that limits seasonal and part-time employee hours to 28 per week so they do not average more than 30 hours for the fiscal year. Both of these policies, however, were enacted before the White House announced the delay in enforcement of the mandate. Several other municipalities and businesses have enacted similar measures, but it is unclear if they will vacate the policies in light of the news of delay.

Next Move For Human Resources

A Gallup poll in June found that 43 percent of uninsured Americans were completely unaware of the individual mandate under Obamacare. This means there may be several workers within your company who do not keep abreast on the daily happenings as they pertain to health care. Let your employees know of any changes your company may be experiencing as a result of the delay. There are many HR personnel who are also learning as the days go by, so be certain you’re knowledgeable about the law yourself before sending out mass emails or letters.