On August 31, 2012, the Internal Revenue Service issued guidance regarding the employer shared responsibility payment and the 90-day waiting period limitation provisions of the Patient Protection and Affordable Care Act (the “ACA”) in the form of IRS Notices 2012-58 and 2012-59.

Employer Shared Responsibility Payment – Determining Full-Time Employee Status.

The ACA added Section 4980H to the Internal Revenue Code (“Code”). Generally, Code Section 4980H provides that an employer with at least 50 full-time employees may be subject to a “shared responsibility payment” if the employer does not provide full-time employees with minimum essential coverage, or if minimum essential coverage is provided to full-time employees, but the coverage does not satisfy certain minimum affordability requirements. Code Section 4980H(c)(4) defines a full-time employee as one who is employed, on average, for at least 30 hours of service per week; however, applying this standard is not always easy, especially for seasonal employees and employees who work a variable schedule.

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