ObamaCare could give advantages to some businesses that ship jobs abroad

posted at 5:21 pm on April 1, 2013 by Patrick Ishmael

Part of the Affordable Care Act requires that businesses who employ 50 or more full time workers provide a certain level of “affordable” health coverage to their employees. The IRS defines a “full time employee” as “an individual employed on average at least 30 hours per week (so half-time would be 15 hours per week).” Part-time employees are also included in this calculation. Reach 50 full time equivalent employees without complying with the new coverage requirements and you may be in for some ACA-sanctioned penalties.

But when is a “full time employee” not a “full time employee”? According to the IRS, when the job is shipped abroad. That means that if you are a growing business approaching the 50 employee cap and you want to avoid both the health care costs and penalties imposed by this section of the health law, the ACA has given you a perverse way of doing it. (And a hat tip to IPI senior fellow Jonathan Ingram for helping me confirm this lead.):

8. Are companies with employees working outside the United States subject to the Employer Shared Responsibility provisions?

For purposes of determining whether an employer meets the 50 full-time employee (or full-time employees and full-time employee equivalents) threshold, an employer generally will take into account only work performed in the United States. For example, if a foreign employer has a large workforce worldwide, but less than 50 full-time (or equivalent) employees in the United States, the foreign employer generally would not be subject to the Employer Shared Responsibility provisions.

9. Are companies that employ US citizens working abroad subject to the Employer Shared Responsibility provisions?

A company that employs U.S. citizens working abroad generally would be subject to the Employer Shared Responsibility provisions only if the company had at least 50 full-time employees (or the equivalent combination of full-time and part-time employees), determined by taking into account only work performed in the United States. Accordingly, employees working only abroad, whether or not U.S. citizens, generally will not be taken into account for purposes of determining whether an employer meets the 50 full-time employee (or equivalents) threshold. Furthermore, for employees working abroad the time spent working for the employer outside of the U.S. would not be taken into account for purposes of determining whether the employer owes an Employer Shared Responsibility payment or the amount of any such payment.

Caveat emptor, ACA supporters. Just one more reason the law needs to be reopened.


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Designed to fail. All going according to plan.

rrpjr on April 1, 2013 at 5:27 PM

You act like they didn’t know this was the case.

CycloneCDB on April 1, 2013 at 5:27 PM

The unwritten part of the ACA:

Foreign-owned companys, who have no employees within the United States or its possessions, are exempt from this Act.

Now ask yourself this….what can’t be done in China?

BobMbx on April 1, 2013 at 5:29 PM

Lol, corporate tax breaks. /

Own it, trolls.

nobar on April 1, 2013 at 5:30 PM

Just one more reason the law needs to be reopened.

It is the plague. It needs to be burned to the ground.

VorDaj on April 1, 2013 at 5:30 PM

“Bain Capital”, you say?

Del Dolemonte on April 1, 2013 at 5:31 PM

An Ass masquerading as a President once found a Doctor’s white lab coat which had been left out in the sun to dry. He put it on and spoke to his countrymen. All bowed, both men and women, and he was a proud Ass that day. In his delight he lifted up his voice and brayed treatments and prescriptions randomly and incoherently and unleashed mindless and thirsty bureaucrats upon the land and then everyone knew him for what he really was.

Cheshire Cat on April 1, 2013 at 5:34 PM

ObamaCare could give advantages to some businesses that ship jobs abroad

That ship already sailed, I’d say.

Marcola on April 1, 2013 at 5:34 PM

They’re still writing it…

Seven Percent Solution on April 1, 2013 at 5:37 PM

Now ask yourself this….what can’t be done in China?

BobMbx on April 1, 2013 at 5:29 PM

Nothing.

ladyingray on April 1, 2013 at 5:40 PM

Now ask yourself this….what can’t be done in China?

BobMbx on April 1, 2013 at 5:29 PM

Republican Government.

Oil Can on April 1, 2013 at 5:59 PM

Oil Can on April 1, 2013 at 5:59 PM

I should have said…

A Republic, that’s the better description.

Oil Can on April 1, 2013 at 6:01 PM

Barry and company are going to kill the economy in order to save it.

GarandFan on April 1, 2013 at 6:09 PM

This is happening more and more in video games. We used to need a team of artists. Now we just need one artist to implement the art being done by a warehouse full of Chinese artists.

hisfrogness on April 1, 2013 at 6:27 PM

Caveat emptor, ACA supporters. Just one more reason the law needs to be reopened repealed.

Obviously there was a typo in your post. I fixed it for you.

Theophile on April 1, 2013 at 6:34 PM

ObamaCare could give advantages to some businesses that ship jobs abroad

I like how the LibDems have always insisted that Chinese and other foreign workers employed by American companies get the same Federal minimum wage and OSHA standards as over here and have actively encouraged said foreign workers to unionize. Yeah, right.

This “workers of the world” scam only interests them when they and their campaign contributors profit, and when it works to their political advantage/votes.

Dr. ZhivBlago on April 1, 2013 at 6:48 PM

Mission Accomplished!

tom daschle concerned on April 1, 2013 at 6:49 PM

FLASH!

profitsbeard on April 1, 2013 at 7:08 PM

then everyone knew him for what he really was.

Cheshire Cat on April 1, 2013 at 5:34 PM

Obviously this didn’t happen before November of 2012, do you have any kind of time line when this might happen?

Cindy Munford on April 1, 2013 at 8:35 PM

Democrats did always have a fascination with people put in chains and worked to exhaustion for little or nothing. I guess it’s easier when someone else has already done the hardest parts for you.

MelonCollie on April 1, 2013 at 10:15 PM