Obamacare: Reducing jobs to part time

[_beastie]

If businesses switch to part-timers, they'll lose in terms of efficiency, dedication, and productivity. So sounds like a bad idea for the business.

You'd think wouldn't you. But in so many fields, business decisions are made by accountants alone. Companies can be very short sighted in their decision making. It seems to me that companies have been choosing higher turnover if it means lower immediate costs for some time now. Keeping people at part time or hiring through temp agencies are what companies have been doing to avoid paying benefits for some time. It will be interesting to see what effects we get when the healthcare law is implemented. I can imagine almost anything happening except businesses actually paying for peoples healthcare.

So much for private business being superior to government.

[_ajax18]

So much for private business being superior to government.

I wouldn't go that far.

[_cinepro]

but obviously we can't convert our existing employees to IC's, so I would have to fire a bunch of people and replace them.

Why wouldn't an owner just fire people then replace them with Independent Contractors? Is it just the threat of paying unemployment benefits?

No, there are serious issues with the IRS and IC's. If an employer needs someone to work for 40 hours a week for months on end, then that person has to be an employee. IC's only work for sporadic workflows, and by definition they can't be tied down to a schedule or other commitments to the company. There are also issues with training; if I have to train someone, they can't be an IC, so I have to find people that are already trained.

So IC's help out when I have a sudden spike of work and I need someone to help for a day or two, but it would take a massive pool of pre-trained IC's to enable me to replace my part-time workers. I actually have a competitor who uses IC's to a much greater degree than I do, but they have a slightly different workflow (and client base). I also suspect if the IRS looked closely, they would classify many of their IC's as employees.

Will you have to raise prices more than your competitor working through independent contractors? How long can you stay in business under those circumstances?

That's what I have to figure out.

[_cinepro]

The cost of insurance, or the cost of the assesment? Just curious.

That's the question. Another problem is that my work (and my workforce) can be extremely seasonal in nature. I do most my work between June-September, so I hire and train people in May and June, and then cut their hours in October. Many come back when the work picks back up, but many don't. It's just the nature of the job. Most are aspiring actors, writers or directors, and really like the flexibility of the position.

So do I buy plans for everyone that I hire in May? What's the penalty for having 30 full time workers in May, then 60 in August, then back to 30 in November? Obviously I can buy insurance for the 30 year-round full timers, but how do the seasonal full-timers impact me?

For a perspective on what my industry is going through, here's a snapshot of how my largest competitor is doing. They're based in Europe, and a public company, so I have a little more insight into the state of their business. Here's their stock from the last year:



They're down to .05 Euro! And they were at 1.28 Euro before the crash of 2008.

So who knows what impact this might have on my competitors, and whether or not the herd may be thinned? And maybe my industry will look back at the Affordable Healthcare Act as a good thing, and a positive change.

But I strongly suspect my competitors that are similar in size are asking the same question I am: how do I get fewer than 50 employees while doing the same amount of (or more) work?

[_beastie]

So much for private business being superior to government.

I wouldn't go that far.

Why? They can't even figure out that hiring part-timers reduces efficiency.

[_ajax18]

Why? They can't even figure out that hiring part-timers reduces efficiency.

No they can't. Capitalism has it's problems. But if the choice is between government run/owned and private, capitalism is still the lesser of two evils.

[_beastie]

Why? They can't even figure out that hiring part-timers reduces efficiency.

No they can't. Capitalism has it's problems. But if the choice is between government run/owned and private, capitalism is still the lesser of two evils.

Why? Studies show that medicare is more cost-efficient than private health care.

I'm not saying EVERYTHING should be under government control by any means. But some things seem to work fine under government control, and private industry isn't always more efficient.

[_Jaybear]

But I strongly suspect my competitors that are similar in size are asking the same question I am: how do I get fewer than 50 employees while doing the same amount of (or more) work?

Your point is valid only if both of the following facts are true:

1. Your similarly sized competitors don't already offer health coverage to their full time employees. In which case, they benefit from the Act, because company like the one you run will not be able to retain a competitive advantage by exploiting their workforce by paying subsistence wages.

2. Economies of scale will cease to exist at or above 50 employees because of the Act.

[_Analytics]

That's the question. Another problem is that my work (and my workforce) can be extremely seasonal in nature. I do most my work between June-September, so I hire and train people in May and June, and then cut their hours in October. Many come back when the work picks back up, but many don't. It's just the nature of the job. Most are aspiring actors, writers or directors, and really like the flexibility of the position.

So do I buy plans for everyone that I hire in May? What's the penalty for having 30 full time workers in May, then 60 in August, then back to 30 in November? Obviously I can buy insurance for the 30 year-round full timers, but how do the seasonal full-timers impact me?how do I get fewer than 50 employees while doing the same amount of (or more) work?

Do the 30 permanent full-time employees already receive health insurance benefits? If not, could you swing providing that subset with benefits?

They are still finalizing this, but what you are going to find out is that the seasonal workers don’t qualify as full-time, and thus you won’t have to give them benefits. You will get a 90-day waiting period before you have to offer them benefits. At the end of the 90 days, you have to make the judgment of whether the employee is expected to work an average of 30-hours per week or more over the course of a full year. If you don’t expect them to work 1,500 hours over the course of a full year, they are part time and you don’t have to offer benefits.

[_subgenius]

conveniently, you omit other "basics"
like
that employers with a certain amount of employees will have to offer coverage..or pay a penalty...and if any employee opts out of that coverage due to its costs then there is a penalty.

First of all, what you are talking about here isn't part of the basic conceptual elements of the law. The basic conceptual element of the law is what I described and nothing more. Second, of course I did go on to describe some of these non-basic things.

Third, if you want to talk details rather than argue about whether any given provision is "basic", let's talk details. The way you describe the penalties is inaccurate. It’s important to understand that the penalties only kick in if one of the employees who doesn’t get minimum coverage from work buys his own coverage in the individual market and gets tax credits to help pay for it. So for example, if Jaybear’s law firm were to drop its health insurance coverage, the firm probably wouldn’t have to pay a penalty, because everybody who works there makes too much money to qualify for the government subsidy.

simply pointing out how your "basics" failed to mention any points relating to employers.
and for example - anecdotal evidence (Jaybear's law firm?) is hardly a good foundation for Federal Policy.

An employer will also have to provide vouchers for specific employee income levels.

That is false. The employer may choose to give vouchers so that the employee can purchase insurance on the exchange, but they don’t have to. Providing the voucher is the same cost as providing the insurance—no extra cost for the employer. It’s just a way that can help a poorly paid employee better-afford their contribution.

not false, you are wrong - the voucher is mandatory should the employee opt for it....if an employee, as i described before, qualifies then they are "entitled" to the voucher...the employer has no "choice". (hint: compare entitled to choice)

AND...should an employer offer what is determined to be a "low value" coverage....yes....a penalty....

False. Large employers need to pay an assessment if they don’t offer their employees an affordable level minimum coverage. It is simply false to divide that single requirement into multiple pieces and imply the single assessment represents multiple penalties.

You are seriously trying to pass "pay an assessment" for "not a penalty".....delusional. You may need to see a doctor to have Ed Schulz removed from your backside.

…provide what is deemed a 'high value" plan and a tax is imposed...

Are you talking about the excise tax on Cadillac plans? Cry me a river.

so, you agree...thank you. Oh, and by the way - how come "equal treatment under the law" only applies when convenient for you? A tax is a tax is it not?

.health plan "value" will be required to be reported on every employees W-2 form.

Reported, but not taxed. Allowing employees to see the full cost of their health insurance is a bad thing how?

wow...how naïve...exactly what purpose could the W-2 have in conveying that information? Should the costs of your workstation? tools? paper? also be reported on your w-2? Yet somehow your reasoning s not supported by the IRS when an employer files less than 250 forms.....so an employee, according to you, is only entitled to see their "full cost of their health insurance" when their employer files more than 250 forms to the IRS.....hmmm....interesting logic....got any other responses you can pull out of thin air?

Larger employers have to automatically enroll employees, while currently no guidelines exist for that...just the requirement and penalty.

False. The guidelines exist and can be found here:

http://www.dol.gov/ebsa/newsroom/tr12-01.html

There is no penalty. The details of the requirement haven’t been fully worked out yet. Until they are, there is no requirement.

actually, the requirement is there
"..on section 18A of the FLSA, which noted that the statute provides that employer compliance with the automatic enrollment provisions of section 18A shall be carried out “[i]n accordance with regulations promulgated by the Secretary [of Labor].”
...the enforcement is just pending the actual regulations being released. So, to say there is no requirement is misleading and blatantly false. You sound like a guy who promises that the toll road is just temporary.

Flex spending, Medical spending, and Health spending accounts will be capped....this government does not trust you to control that money.

This is nothing more than lowering the limit on tax deductions and tax-advantaged plans. You are free to do whatever you want with your money.

thanks for defining "capped"...and ironically i am not free to do whatever i want with my money...the key to that is where you wrote "limit" above...limit is actually not "free". In other words, the increased regulation, restriction, penalty, and "limit" on Spending Accounts prevents and/or punishes me from being "free" to control my own health care. But thanks for trying to pretend otherwise. Why should the government discourage a person from taking responsibility for their own costs? why would they be so deliberate in making sure that i would be at a financial disadvantage to be self-reliant with my health care spending?....the naïve nature of your posts on this subject is alarming.

Employers can create wellness programs that qualify for discounts....but as they are determined by the Secy of Health/Human services.

Are you suggesting that the government should provide incentives for employers to create wellness programs, but that the government shouldn’t determine what qualifies???

no

yep, done here...obvious that your posts are just going to be full of msnbc talking points and with little "basic" information about the actual issue.

It’s ironic that you equate factual information taken directly from official government sources as “msnbc talking points.”

As soon as you provide factual information...your link to an FAQ page for one subject is hardly that (and even that contradicts your position)...otherwise you have been pretty consistent, er in goosestep, with every other wannabe-freeloader.
Get a job hippie