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Staffing Agencies and ACA Compliance: The Struggle is Real
As an industry with a large turnover rate, an unconventional hour-to-dollar ratio, and a majority of employees working part-time, staffing agencies have a lot to take under consideration to determine whether they’re complying with ACA regulations. It’s not an easy task. Fortunately for staffing agencies, paying attention to a few important details can go a long way toward avoiding unwanted ACA penalties.
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Why Some Staffing Agencies Overlook Their ACA Responsibilities
Tracking hours for employees you pay directly is crucial. Unfortunately, not all staffing agencies stay up to date on tracking their employees’ hours, which leads to unforeseen hiccups.
You might miss that some of the part-time employees you staff out and pay directly have hit the 30-hours-a-week threshold and are now considered full-time under the ACA. Even if you provide insurance to internal full-time employees, you’ll be on the hook for all the formerly part-time employees you missed.
This can leave you scrambling, forcing you to hire someone – or find a program – that can go back and accurately track the hours. But if you start tracking now, you won’t have to deal with that rush, because you’ll already know which employees are on your payroll (vs. those being paid by the company where they were placed), while also having an accurate count of all your employees.
Among staffing agencies that do keep close track of hours, some even limit the number of hours they staff employees they pay directly. This is done to ensure those employees remain at or below 30 hours so the agency isn’t required to offer benefits.
Why Some Staffing Agencies Overlook Their ACA Responsibilities
Tracking hours for employees you pay directly is crucial. Unfortunately, not all staffing agencies stay up to date on tracking their employees’ hours, which leads to unforeseen hiccups.
You might miss that some of the part-time employees you staff out and pay directly have hit the 30-hours-a-week threshold and are now considered full-time under the ACA. Even if you provide insurance to internal full-time employees, you’ll be on the hook for all the formerly part-time employees you missed.
This can leave you scrambling, forcing you to hire someone – or find a program – that can go back and accurately track the hours. But if you start tracking now, you won’t have to deal with that rush, because you’ll already know which employees are on your payroll (vs. those being paid by the company where they were placed), while also having an accurate count of all your employees.
Among staffing agencies that do keep close track of hours, some even limit the number of hours they staff employees they pay directly. This is done to ensure those employees remain at or below 30 hours so the agency isn’t required to offer benefits.
Tracking Hours to Save Time and Resources
No one wants to find themselves scrambling for information right before it’s time to file. This can be especially problematic if you’re a staffing agency.
To avoid potential pitfalls, make sure you track the number of your full-time equivalent employees to see if you’re an ALE and properly record the hours worked by full-time, part-time, and seasonal employees. SyncStream can help your staffing agency stay on top of ACA regulations through their innovative software solution.
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SyncStream's Full-Service Total ACA ™ solution offers the complete toolset needed to properly track, manage, file and defend your Affordable Care Act compliance.
Total ACA includes tracking and reporting of variable hour employee tracking, managing plan information and enrollment data, and populating codes.
Total ACA’s team of Compliance Experts guides you through the year-end process of printing and mailing of 1095 forms and E-Filing of 1094/1095 forms to the IRS.
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