Overtime Scale.jpgThe Affordable Care Act (ACA) is the most impactful federal legislation to affect healthcare insurance in many years, challenging large companies with new reporting requirements focusing on employee time and attendance. As a business owner or HR manager, it’s essential to understand the effects of the law and get staff up to speed on the new compliance measures. HR departments must assess their processes and systems in order to embrace what’s known as “Pay or Play.”

Pay or Play 101

This ACA provision requires companies with at least 50 full-time employees to offer the opportunity to enroll in certain healthcare plans – or face penalties for failure to do so. The minimum coverage that’s acceptable under the ACA is defined in the statute but, as it relates to time and attendance systems, certain terminology is of particular interest.

How Pay or Play Impacts Large Employers

Companies must make a standard health benefits package available to employees who meet predetermined benefit levels, known as “minimum essential coverage”. Failing to do so subjects businesses to certain penalties, which are best described by:

Clearly, the calculation of FTE’s an organization maintains is critical for avoiding these penalties, especially for those that hover around 50 employees for the measured time period. Large companies may face penalties amounting to hundreds of thousands of dollars if they lack adequate means of managing ACA requirements.

Human Resource Information Systems

HRIS technology has emerged as one of the most effective means of managing full time employees and calculating FTE for purposes of meeting strict ACA compliance measures. Aside from offering HR benefits collecting and managing data on payroll and employee benefits, the time and attendance functions help large employers avoid the significant penalties for ACA non-compliance.

While the ACA is still in its early stages in some areas and not yet fully implemented in others, it’s clear that companies and HR departments must adapt their processes for collecting time and attendance records. Paypro offers an array of HR solutions and tools that streamline the reporting process, thereby helping companies meet the requirements of ACA provisions. To learn more on how we can help with ACA reporting and other requirements of the Affordable Care Act contact us to request a consultation with one of our workforce management experts.