Hiring Summer Help? Keep ACA Compliance in Mind

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As summer brings an influx of temporary and seasonal employees, HR teams play an important role in balancing workforce needs with Affordable Care Act (ACA) compliance. Whether your organization hires interns, part-time staff, or other short-term workers to cover increased demand, understanding how these hires affect your ACA obligations is essential to avoid penalties and maintain smooth operations.

With summer well underway, it’s important to review ACA requirements for seasonal employees before the season comes to a close.

Are You an Applicable Large Employer (ALE)?

If your organization has 50 or more full-time employees or full-time equivalents (FTEs), you are considered an Applicable Large Employer under the ACA. As an ALE, you must offer affordable, minimum essential coverage to full-time employees, those averaging 30 or more hours per week or 130 hours per month, or face potential penalties.

Even though seasonal employees are temporary, their hours can impact your ALE status, and their work schedules may trigger ACA coverage obligations.

Seasonal Employee Considerations

Many summer employees fall under the category of seasonal workers, but classification matters. The ACA provides an exception for seasonal employees working fewer than 120 days in a calendar year, meaning coverage may not be required. However, employers must:

• Track hours for all summer workers
• Classify employees appropriately
• Prepare for situations where temporary roles extend beyond the summer

If a seasonal employee transitions to an ongoing role or works enough hours to meet full-time thresholds, an offer of health coverage may be required to comply with ACA guidelines.

Measurement and Stability Periods

Many ALEs use the ACA’s look-back measurement method to determine full-time status for variable-hour and seasonal employees. Properly applying measurement and stability periods is crucial:

• During the measurement period, track hours worked by seasonal employees.
• If an employee averages 30+ hours per week, they may qualify as full-time for the upcoming stability period, even if hired initially for summer-only work.
• Employers must ensure offers of coverage are made at the appropriate time if eligibility is triggered.

Accurate documentation of these periods helps prevent errors and protects your organization during audits or inquiries.

Affordability and Minimum Value Requirements

If coverage is offered to seasonal employees or required under ACA rules, that coverage must:

• Meet the ACA’s minimum essential coverage standards
• Be considered affordable based on IRS guidelines

While many seasonal employees will not require offers of coverage, unexpected extensions of employment or changes in work hours can shift eligibility, making it critical to monitor evolving circumstances.

The Importance of Documentation and Reporting

Proper record-keeping is important for demonstrating ACA compliance:

• Maintain detailed records of summer employees’ hours
• Document eligibility determinations and offers of coverage
• Track communications regarding benefits and enrollment

Review these records before the summer season ends to address any gaps, particularly for employees whose roles may extend beyond summer.

Communication Is Key

Seasonal employees should receive clear, timely information about:

• Whether benefits are offered
• How eligibility is determined
• Enrollment deadlines and procedures

Transparent communication fosters trust and helps employees make informed decisions, reducing confusion and administrative challenges.

Final Takeaway

Welcoming summer help can be a valuable solution for your organization, but ACA compliance must remain a priority. By:

• Tracking hours accurately
• Applying measurement and stability periods properly
• Monitoring coverage requirements
• Maintaining clear documentation
• Communicating effectively

HR teams can support operational needs while ensuring compliance with ACA regulations.

Don’t wait until summer is over. Review your ACA processes now to avoid penalties and keep your workforce compliant, efficient, and well-informed.