ACA Compliance for Clients

The Affordable Care Act (ACA) has been a tricky piece of legislation to navigate for staffing firms and the clients that work with them. A recent ruling clarifies guidelines for an unusual circumstance in which the client is determined to be the “common law employer” of temporary staff. In the vast majority of cases the staffing firm is the employer clean and simple.[1] This means that the staffing firm is the only one responsible for tracking eligibility and offering health insurance under the ACA.

In the rare cases that a client organization is nervous that they might be determined to be the common law employer, this new ruling states that an additional fee should be added to the client’s invoice as a line item with language explicitly stating that the fee is for providing ACA-compliant coverage to the employee(s). If there is a written contract between the client organization and the staffing firm, then language should also be added to that document laying out the ACA coverage fee structure.

As long as those two requirements are met, then the health coverage provided by the staffing firm will be viewed as being provided by the client. If you are currently using a staffing firm to fill temporary or temp-to-hire positions and are worried that your company might be ruled the common law employer of those employees, then talk to the recruiter that you have been working with about your concerns. She will be able to help you get this new language added to your contract and an ACA line item added to your invoice.

[1] http://www.irs.gov/publications/p15a/ar02.html#en_US_2014_publink1000169467