What Employers with Contingent Workforces Need to Know About the Affordable Care Act

detail_21_staffing_solutions_wisconsinOn January 1, 2015, the EmployER Mandate of the Affordable Care Act (ACA) goes into effect. Companies with more than 50 employees will be in “Pay-or-Play” mode, including staffing firms providing large contingent workforces to businesses.

Employers who utilize temporary employees from staffing firms need to be aware of which mode “Pay” or “Play” their staffing firm(s) is/are choosing in 2015. Compliance within the staffing industry varies because of the many types and sizes of staffing firms and the options each of these firms need to consider when dealing with the ACA rules and regulations. The ACA requires extensive tracking and documentation, and creates unprecedented administrative issues.

Staffing firms choosing to “play,” such as Nissen Staffing Continuum, will be offering “low option cost for employee” health insurance coverage required by the government as a safeguard and for the benefit of all parties involved, including:

  • Retention benefit for temporary employees. Health insurance coverage is another employment benefit for temporary employees, giving businesses relying on a flexible workforce a stable, consistent group of employees.
  • Administrative support and documentation. Staffing firms choosing to “play” are employing new tools for tracking, administration and documentation advantageous for the employee, business and staffing firm. For businesses utilizing a contingent workforce, all necessary paperwork for future audits and proof of compliance is accessible because of the firm’s due diligence.
  • Protection from common law employer clause. One challenging issue for businesses and staffing firms is the common law employer clause of the ACA, a generalized set of rules detailing how to determine who is required to offer health care insurance to the employee. According to Erinn Stromberg, Operations Manager at Nissen Staffing Continuum, “Nissen Staffing Continuum will be taking every step to protect our clients from the common law clause by adding new provisions into our terms of business (client agreement) that will satisfy this regulation.” ACA-compliant firms will have provisions and documentation protecting their clients from liabilities that could arise over the common law employer clause.

As a business, knowing whether your preferred staffing firm will “play or pay” in 2015 is essential for every employer utilizing a contingent workforce to meet their staffing needs. Partnering with a staffing company not in the “play” mode and not taking the necessary precautions to protect you from the Common Law Employer clause can leave your business open to unprecedented consequences and penalties that come with this new legislation—and your business will be the one to pay.

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