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Definition of Full-Time

Under the ACA, employers with more than 50 full-time employees are required to provide affordable group health insurance coverage to employees and their dependents or face financial penalties. The ACA defines a full-time employee as an individual who works an average of at least 30 hours per week. This definition is inconsistent with standard employment practices in the United States today, which typically define full-time employment as 40 hours a week or more, and other federal laws. As a result, some employers have opted to eliminate health care coverage for part-time employees to cover the costs of providing coverage to full-time employees, while others have re-engineered staffing models to lower employee hours below the 30-hour threshold to avoid coverage requirements.

Outlook: Bipartisan, bicameral legislation to amend the ACA’s definition of “full-time” employee has been introduced.  Representatives Jackie Walorski (R-IN) and Daniel Lipinski (D-IL) introduced H.R. 3798, the Save American Workers Act, and Senators Susan Collins (R-ME) and Joe Donnelly (D-IN) introduced S. 1782, the Forty Hours Is Full-Time Act. These proposals would amend the Internal Revenue Code to modify the definition of a full-time employee from 30 hours to 40 hours of service per week for purposes of the employer mandate. The bill would not require employers to change their definition of full-time. Instead, the bill would provide employers the flexibility to determine what constitutes "full-time" (between 30 to 40 hours) for their business. 

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