Human Resource & Labor News
www.agc.orgJanuary 24, 2013 / Issue No. 1-13
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On the Inside
Labor Relations
Federal Court Finds Michigan PLA Law Preempted by NLRA
Free Members-Only AGC Webinar on Multi-Employer Pension Reform January 29, 2013
Collective Bargaining in 2012 Yields Average 1st-Year Increase of 2%
Court Dismisses Carpenters’ RICO Lawsuit Against Building Trades
Federal Labor Agencies Update Regulatory Agendas
Review of 2012 W-2s Necessary After Fiscal Cliff Deal Increases Transit Benefits
Care for Adult Children under FMLA Clarified
U.S. Transportation Department Issues Guidance on State-Approved Recreational and Medical Marijuana Use
Health Care
AGC to Host Webinar on the Affordable Care Act
IRS Proposes Regulations for Affordable Care Act “Pay or Play” Mandate
Group Health Plans Undergo Strenuous Labor Department Audits
Prepare Your Workforce for Flu Epidemic
Special Events
Don’t Miss the Jan. 31 Early-Bird Deadline for AGC’s Annual Convention - March 5-9 in Palm Springs, CA
Combined Construction HR and Training Professionals Conferences Set for Oct. 16-17 in Chicago
IRS Proposes Regulations for Affordable Care Act “Pay or Play” Mandate

On January 2, 2013, the U.S. Internal Revenue Service (IRS) issued a Notice of Proposed Rulemaking (NPRM) regarding the employer mandate provision of the Affordable Care Act (ACA).  This provision goes into effect on January 1, 2014, although there is some transition relief for plans that do not operate on a calendar-year basis.  The IRS also released a series of questions and answers highlighting the key provisions in the NPRM.  The proposed regulations explain how employers should determine if they are subject to the employer mandate of the Act – the so called “pay or play” rules, how to determine which employees are considered “full-time employees,” and how the employer penalty would be calculated and paid.  While this rule is not yet final, it is considered by the IRS to be guidance for employers and can be relied upon through 2014.  The proposed rule can be found in the Federal Register.

One of the most noted clarifications in the proposal is the requirement for large employers to offer coverage not only to full-time employees but to their dependents as well.  While the cost of coverage for the employee must not exceed 9.5% of the annual household income for the purchase of his or her own coverage, this is not a requirement for coverage offered to dependents – a relief for employers who do not wish to pay for dependent coverage.  It is important to note that spouses are not considered dependents under this definition and are not required receive an offer of coverage.

The NPRM also clarifies the definition of “large employer” and explains how multiple employers within a one controlled group should determine if they must comply with the requirements of the law, and if so, how penalties will be assessed for non-compliance.  Additional topics covered include:

  • Changes in employment status from part-time or seasonal to full-time;
  • Treatment of rehired employees and others with service breaks;
  • Counting paid leave for the purposes of determining “full-time” status;
  • Counting hours worked by foreign employees;
  • Penalty assessments for employers when employees fail to pay their portion of the insurance premium;
  • Safe harbors for determining affordability; and
  • Transition relief options for employers.

The IRS is accepting comments on the proposed regulations through March 18, 2013.  As a member of a cross-industry coalition that has been heavily influencing the implementation of the ACA, AGC will continue to address the effects of this law on the construction industry during this regulatory process. 

AGC members with specific concerns or questions are encouraged to contact Tamika C. Carter, AGC’s director of construction HR, at or 703-837-5382.
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