The Affordable Care Act originally defined “full time” employees as those who work 30 or more hours per week, instead of the customary 40 hours that most Americans put in. This definition is key in determining whether or not large- and mid-sized employers are required to provide these employees with health insurance in 2015 and 2016, respectively.
Concerns have been raised by members of both the Senate and the House of Representatives, and consequently the Save American Workers Act and Forty Hours is Full Time Act have been proposed. These acts are the result of the possibility that as many as 9.8 million American workers might be at risk of losing their jobs or work hours if the current definition held.
The ACA’s math is simple: Three employees working 40 hours a week will produce 120 hours. Five employees working 24 hours per week will also produce 120 hours. Under the ACA, employers must offer the three full-time employees health insurance or pay a penalty. They have no such obligations to the five part-time employees, making part-time employment less costly. In this way, the ACA unintentionally encourages our general managers to reduce their employees’ hours to under 30 a week.”