As stated in a previous SGR Client Alert, employers are required under the Patient Protection and Affordable Care Act (“PPACA”) to notify their employees about the coverage options available under the Health Insurance Marketplace (the “Marketplace Notice”).  The Marketplace Notice requirement applies only to employers that are subject to the Fair Labor Standards Act (“FLSA”).  Employers are required under PPACA to provide the Marketplace Notice to current employees no later than October 1, 2013.

Today, the Department of Labor (“DOL”) released a Frequently Asked Question which clarifies that no fine or penalty will apply to an employer who fails to provide a timely Marketplace Notice to an employee.  Although there is no express penalty provision for failing to provide the Marketplace Notice in a timely manner, employers should not ignore this requirement under PPACA.  This provision of the Marketplace Notice could be viewed by the DOL as part of an employer’s fiduciary obligation to provide required disclosures to participants under the Employee Retirement Income Security Act of 1974 (“ERISA”).

Therefore, employers should continue to take the necessary steps to provide the Marketplace Notice to their current employees by October 1, 2013 and to all new hires thereafter.