Calculating Full-Time Employees Under Health Care Reform

Employers need to examine their workforces now to determine whether they will be considered large employers under the Patient Protection and Affordable Care Act. Employers with 50 full-time / full-time equivalent employees (FTEs)will be required to offer affordable health coverage in 2014 or pay penalties.

The regulations are based on the number of full-time employees and FTEs during the preceding calendar year. A special six-month transition rule, applicable for 2014 only, allows employers to use any six-month period in 2013 when calculating employees. This gives them time to make decisions and plan for 2014.

In calculating full-time employees and FTEs, employers must follow a complex set of rules that cover:

  • Standard measurement periods for calculations
  • Number of employee hours of service
  • Salaried employees
  • Employees covered by collective bargaining
  • Transportation employees
  • Sole proprietors, partners, S-Corp shareholders, leased employees, and employee-directors
  • Controlled group, affiliated service group, or qualified separate lines of businesses
  • Overseas vs. U.S. income
  • Vacations, holidays, illness, incapacity, layoff, jury duty, military duty, and leaves
  • Rehired employees and those returning from leaves of absence
  • Seasonal and variable employees
  • People employed in different states.

Please contact me to help your readers understand this issue. CliftonLarsonAllen’s employee benefits professionals serve more than 2,300 employers nationwide and nearly 100 employers have been using its customized Health Insurance and Penalty calculator ( to discover their own 2014 health coverage costs and make decisions accordingly.

Ann Dee Allen

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