Tip Tuesday! How to calculate employer health care responsibilities

By Ken Tysiac

In compliance with new health care employer responsibility regulations, two halves indeed equal a whole for employers when they determine their number of full-time employees.

To determine whether a business is subject to the employer mandate penalty under the Patient Protection and Affordable Care Act (PPACA), P.L. 111-148, the business must determine the number of its full-time employees, which includes its full-time equivalent employees (FTEs). An employer’s FTEs are based on the hours worked by its part-time workers. The number of an employer’s FTEs for a month is the total part-time employee hours for the month divided by 120.


In 2015, to avoid paying the employer mandate penalty, employers with 100 or more full-time employees are required to offer health care coverage to employees that provides minimum value and is affordable. Employers with 50 to 99 full-time employees can certify to the IRS their employer size and certain other items to delay application of the rule until 2016.

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