1. The Dust Is Settling, But We Still Have Some Challenges
The American Staffing Association (ASA) has worn out the road to DC. Lobbyists have played a big part in cluing DC into the reality of where the Affordable Care Act (ACA) doesn’t accommodate those with nonconventional work arrangements, such as independent contractors and freelancers. These are the workers our world is increasingly made of—folks who may work full time this week, not at all next, and then full time again the week after.
Though we do still have some challenges to work through, the ASA has been a much-needed voice for the custom staffing industry. They’re getting the rules straightened out and it’s working (somebody please send them some flowers).
2. There is HOPE for Automated Eligibility Tracking
As the dust settles, automation has become more feasible. The frequent changes to the act, in its infancy, made automatic tracking problematic. Now that there’s some stability in the guidelines for contingent workers, we’ll be able to add this capability into our arsenal of HR tools.
3. Effects on Costs Still Unclear
With low participation rates to date, there hasn’t been a lot of money on the line. Yet. Penalties for individuals who don’t comply have been minimal. As these get stiffer, we expect participation will increase. As participation increases, administrative costs will, too. This time next year, they could conceivably double.
4. Still Not Sure How To Pay For It
However the costs increase, they’ll be across the board because we’re all bound by the same law. Some clients are struggling because they don’t fully grasp how the ACA could affect their budgets and add to their overall labor costs. The best way we’ve found to think about it is that it’s very similar to managing the cost of worker’s comp.
With a tepid economic recovery, what amounts to another labor tax has been hard for some clients to swallow. Some have said they will only pay a certain additional amount for ACA, and unless someone blinks, it’ll be standing room only at the OK Corral. Meanwhile, a fortunate few increased their budget for contingent labor and are happy that it’s going to cost them less than they may have anticipated.
At PayReel, we will comply with the new law both in letter and spirit. Therefore, we’ve decided we won’t be party to efforts that attempt to manipulate freelancers’ hours to stay just below ACA eligibility.
We’ll do what businesses do best—figure out how to adjust to new business realities.
Note: We covered our lessons from the first five years in our last post. Next, we covered our predictions for the election year. Finally, we’ll soon post which questions we still need to be answered even as the dust is settling.
About PayReel
PayReel’s clients, who are some of the biggest companies in the world, are constantly immersed in the chaos of producing multimedia content or executing live events. PayReel makes sure they have the right contractors at the right time in the right place, and that everyone gets paid properly. And, most importantly, they handle every last detail perfectly while making sure their clients think nothing of it, so they can get back to doing what they do best.
