What We Know
⦁ Staffing agencies generally have two classes of employees (In-House & Temporary Employees)
⦁ Historically, staffing agencies have offered lower-tier or no health benefits to temporary employees as opposed to their In-House staff
⦁ Many staffing agencies have adopted a blanket policy and understanding where temporary employee goes hand in hand with a Variable Hour declaration at hire
⦁ Quite a bit of confusion between the intent of the hire and the work expected of the employee wherever positioned
⦁ The spirit of the law was to serve as a one-size-fits-all shoe, even though the letter of the law does not always agree with all employers
⦁ The Affordable Care Act was written to help employees, by means of avoiding potential abuse
Set the Record Straight
⦁ PPACA: The Staffing Agency Edition does not exist, there is only one law, one rulebook for all employers concerning this regulation
⦁ It is abundantly clear that the IRS may scrutinize and critically look at employers for blanketing a variable hour label to a worker solely because they were hired into a temporary employee class
⦁ ALL employers are forbidden to declare a new hire as a variable hour employee solely on the fact that they may not be employed for a full measurement period
⦁ What are the responsibilities of a staffing agency (once determined to be an ALE)?
⦁ Ensure that they know if they are an employee’s Common Law Employer
⦁ In most cases, the temp agency is the employer
⦁ Do they have the right to control employee’s schedule?
⦁ Do they have the right to control how the work is done?
⦁ Can they terminate the employee at will?
⦁ Have an internal HR policy established for New Hires, refuse to deviate from it
⦁ Document EVERYTHING
⦁ It is the sole discretion of an employer to choose and declare an employee as Part-time, Variable Hour, Seasonal or Full-time
⦁ All this means is that the employer has the freedom to make the decision, not that it is the wrong one or overrules the regulations
⦁ Part of documentation should be some reasoning for the declaration chosen
⦁ This can be used to defend why a decision was made
⦁ Per regulations, if the decision was made where the employer, in good-faith, believed the temporary employee to be variable hour, this is a proper defense
Conclusion:
⦁ If an employer is convinced, on the employee’s start date, that the employee will not average 30 hours a week in their position, regardless of length of placement, variable hour may be a correct declaration