Under health care reform, a full-time employee is an employee who works 130 or more hours per month. Many teachers and other employees of educational institutions do not work over the summer months. If structured properly, employees of educational organizations are not penalized for full-time status if they don’t have working hours during the summer.
An educational organization may take advantage of special break in service rules under health care reform. An “educational organization” is an entity whose primary function is the presentation of formal instruction and that normally maintains a regular faculty and curriculum and has a regularly enrolled body of pupils or students in attendance at the place where educational activities are regularly carried on.
Since educational organizations have extended break periods when classes are not in session and employees do not perform services, the ACA rules take this into account when determining full-time or not-full-time status.
Educational Organizations have special rules for determining when an employee on a break returns to work and can be considered a new employee-
- An employee that has a break of service of 26 or more consecutive weeks may be treated as a new employee. The rule for non-educational organizations is 13 weeks.
- An employee can be treated as a new employee if the period in weeks during which no services are preformed is at least 4 weeks long and not longer than 26 weeks and exceeds the number of weeks of employment immediately preceding the break.
Educational Organizations also have special rules for counting hours during employment break periods-
- The employer can determine average hours of service by excluding any employment break period occurring during a measurement period and applying the average for the entire measurement period.
- The employer can impute hours of service for the employment break period at a rate equal to the average weekly hours of service for weeks not part of the employment break period.
Educational Organizations should pay close attention to the break rules when determining if an employee should be considered full-time or not full-time for purposes of health care reform.
