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Business groups laud delay of ACA penalties

July 03 2013

The U.S. Chamber of Commerce, the National Federation of Independent Business and others lauded a move by the federal government to delay employer penalties under the Affordable Care Act for one year to 2015 from the original start year of 2014.

“Since the beginning of the health reform debate the U.S. Chamber has consistently stated the employer mandate and other burdensome provisions of Obamacare would be harmful to job creation and economic growth,” U.S. Chamber of Commerce President and CEO Thomas Donohue said in a statement. “The administration’s decision to recognize this fact yesterday and delay the implementation of the employer mandate is welcomed by the business community and will help avoid some serious near-term economic consequences of this law.”

“This is simply the latest evidence that implementation of this terrible law is going to be difficult if not impossible, and the burden is going to fall on the people who create American jobs,” Amanda Austin, director of federal public policy at the National Federation of Independent Business, said in a statement. “Temporary relief is small consolation. We need a permanent fix to this provision to provide long term relief for small employers.”

Staffing firms and other employers had been working to prepare for the upcoming penalties, which some refer to as taxes. Under the penalties, employers with 50 or more full-time equivalent employees that don’t offer healthcare insurance would face a penalty of $2,000 per year multiplied by all their full-time employees if at least one full-time employee gets a tax credit to buy insurance. Even employers that do offer insurance can face a penalty of $3,000 per year for each employee who receives a tax credit to buy insurance if the insurance is not affordable for the employee or does not provide minimum value.

A blog post on the White House website said the delay came as the federal government works to simply the reporting process for business that will be required under the new law. For the blog, click here.

For more on the delay, including comments by George Reardon, special counsel at employment law firm Littler Mendelson, click here.

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