The Affordable Care Act (“ACA”) shared responsibility provisions for employers do not go into effect January 1, 2014. However, employers cannot wait until 2014 to determine their ACA obligations. 

The term “shared responsibility” refers to the requirement that employers with 50 or more full-time employees (including full-time equivalents) pay for their employees’ health insurance or pay a penalty. 

For an employer close to the 50 full-time employee threshold, the number of employees employed during 2013 will determine the employer’s obligations under the ACA for 2014. However, for 2014 only, an employer is permitted to determine its large employer status using a period of at least six consecutive calendar months in the 2013 calendar year (rather than the entire 2013 calendar year). Therefore, there is still time in 2013 for employers to look at their employment levels and make plans that could affect their obligations under the ACA for 2014.

If an employer is an applicable large employer in 2014, it will be required to pay an “employer shared responsibility payment” if it does not offer minimum value and affordable healthcare coverage to at least 95% of its full-time employees and their dependents. For employers with employees who work variable hours and cannot easily determine whether an employee will work an average of 30 hours per week, a “look back” measurement period can be used. 

Because this is a look-back period, hours worked by employees in 2013 will determine whether they are full-time in 2014 and eligible for coverage. However, an employer intending to adopt a 12-month measurement period may adopt a transition measurement period that is at least six months long, begins no later than July 1, 2013, and ends no earlier than 90 days before the first day of the plan year beginning on or after January 1, 2014.