Large Business Employers

A business is defined as “large” if it has at least 50 full time equivalent employees, not counting seasonal workers. Full-time employees are those who work 30 hours or more per week; part-time employees work less than 30 hours per week, figured on a monthly basis.

The Affordable Care Act will require large employers (over 50 full time equivalent employees) to provide health insurance for their employees or pay a per-month penalty on their federal tax return.  The Employer Mandate (Employer Penalty) will not go in to effect until 2016 for those business with 50-99 employees. For those with 100 or more employees, it will become effective in 2015.

The Employer Penalty has a gradual phase-in, so beginning in 2015, employers with 100 or more employees must offer coverage to at least 70 percent of full-time employees as one of the conditions for avoiding the Penalty.  In 2016, coverage must be offered to at least 95 percent of full- time employees.

If you have more than 50 full-time equivalent (FTE) employees, you generally won’t be able to use the SHOP Marketplace to purchase health insurance.  Starting in 2016, all SHOPs will be open to employers with up to 100 FTEs.