Friday, July 19, 2013

Fwd: qotd: Forty Hours Is Full Time Act of 2013

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-------- Original Message --------
Subject: qotd: Forty Hours Is Full Time Act of 2013
Date: Fri, 19 Jul 2013 12:19:17 -0700
From: Don McCanne <>
To: Quote-of-the-Day <>

The Library of Congress
113th Congress, First Session

S.1188 -- Forty Hours Is Full Time Act of 2013

To amend the Internal Revenue Code of 1986 to modify the definition of
full-time employee for purposes of the individual mandate in the Patient
Protection and Affordable Care Act.

June 19, 2013

Ms. COLLINS (for herself and Mr. DONNELLY) introduced the following
bill; which was read twice and referred to the Committee on Finance

To amend the Internal Revenue Code of 1986 to modify the definition of
full-time employee for purposes of the individual mandate in the Patient
Protection and Affordable Care Act.

Be it enacted by the Senate and House of Representatives of the United
States of America in Congress assembled,

This Act may be cited as the `Forty Hours Is Full Time Act of 2013'.

Section 4980H(c) of the Internal Revenue Code of 1986 is amended--
(1) in paragraph (2)(E), by striking `by 120' and inserting `by 174'; and
(2) in paragraph (4)(A) by striking `30 hours' and inserting `40 hours'.


The Wall Street Journal
July 18, 2013
ObamaCare's Definition of a Full-Time Job Needs Revising
By Sen. Joe Donnelly (D-Indiana) and Sen. Susan Collins (R-Maine)

In Lafayette, Ind., a school district cut the hours of 200 support staff
to no more than 29 per week. In Bangor, Maine, the school system is
preparing to track and cap the number of hours worked by substitute
teachers to ensure that they don't work more than 29 hours a week.
Elsewhere, in Portland, Maine, a small business reduced a part-time
employee's hours from 35 to 29.

We are hearing reports like this from across the country. Why is this

It's happening because under the Affordable Care Act a "full-time
employee" is defined as anyone working an average of 30 hours a week,
rather than the traditionally accepted 40-hour work week. Employers with
more than 50 full-time employees or full-time equivalents will be
required to provide their employees with health insurance or potentially
face a financial penalty, essentially a fine.

This rule is causing a growing number of employers to cut the hours of
their workers, and according to one study by the UC Berkeley Labor
Center, at least 2.3 million workers are at risk. This provision of the
health law is not in the best interests of the country, and it needs to

As the economy shows modest signs of recovery, we should be working with
employers to encourage additional job growth. Yet we are hearing from
small businesses, public school systems and nonprofit organizations,
that they are cutting employee hours and forgoing additional hiring in
an effort to ensure that they are in compliance with the law.

To address this problem, we have introduced the "Forty Hours is Full
Time Act of 2013." It defines a full-time employee for the purposes of
complying with the Affordable Care Act as someone who works an average
of 40 hours per week, or 174 hours per month for full-time equivalents.

Comment: Many employers are in the process of reducing employees' hours
to under 30 per week in order to avoid the requirement to either provide
health insurance for their workers or pay a penalty. Not only do these
employees end up with no health insurance, they also have their
paychecks reduced by about 25 percent. Since most already have modest
incomes, this reduction in pay can create severe financial hardship.
What can be done?

Senators Collins and Donnelly seem to define the primary problem as the
reduction in income that these employees face. By changing the
definition of full time work to 40 hours per week for purposes of the
Affordable Care Act (ACA), employers will be able to preserve most of
their workers' incomes by employing them for 39 hours, while being
relieved of the responsibility of providing health insurance. The
employees will still be able to have health insurance since they can
then purchase individual plans in the state insurance exchanges. Little
does it matter that these are low-actuarial value plans with
high-deductibles, and inadequate subsidies to protect family budgets.
Oh. Maybe that won't work so well.

It is not simply the definition of a work week that is wrong. It is the
fundamental ACA financing model that is terribly flawed. Trying to fix
it with patches such as redefining the work week will never get us where
we need to be. We have to change the financing model. (Yes, we need
single payer.)

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