An employer that is an Applicable Large Employer (ALE) must comply with the Affordable Care Act (ACA). An employer is an ALE if it had an average of at least 50 full-time employees (including full-time equivalent employees) during the prior year. A full-time employee is an employee who has on average at least 30 hours of service per week during a calendar month. ALEs must provide minimum essential, affordable coverage or be subject to a tax penalty. ALEs must also comply with health care reform reporting requirements.
To determine the number of full-time equivalent employees, the employer combines the number of hours of service of all non-full-time employees for the month (limited to 120 hours of service per employee) and then divides the total hours by 120.
Employers with common ownership are treated as one employer for determining ALE status.
BAS has an easy-to-use calculator that employers may use to determine FTE status. For more information, contact solutions@BASusa.com.