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On behalf of the National Federation of Independent Business (NFIB), the nation’s leading small business advocacy organization, I am writing in support of H.R. 2575, the Save American Workers Act of 2013. H.R. 2575 will be considered an NFIB Key Vote for the 113th Congress.
This legislation would replace the new 30-hour per week full-time or full-time equivalent (FTE) employee definition in the Patient Protection and Affordable Care Act (PPACA) with a 40-hour per week definition. PPACA defines full-time employee for the purpose of the employer mandate as an employee who works an average of 30-hours per week (130-hours per month). The employer mandate is a requirement that businesses with 100 or more full-time or FTE employees offer qualified, “affordable” health insurance to 70 percent of full-time employees or pay costly penalties beginning in 2015. In 2016, businesses with 50 or more full-time or FTE employees must offer qualified, “affordable” health insurance to full-time employees and their dependents or pay costly penalties.
Last year, NFIB testified before the House Committee on Small Business that the new definition is “one of the most dangerous parts in the law.” PPACA marks the first time that “full-time” is expressly defined in law. Prior to PPACA’s enactment, the determination was left up to the employer. Similarly, the Fair Labor Standards Act has long dictated that overtime pay starts after 40-hours per week. Thus, employers and employees have long understood “full-time” to be equivalent to 40-hours per week.
The 30-hour full-time definition is already resulting in less opportunities, fewer hours and lower incomes for employees. Small businesses are already being forced to shrink their workforce below and restricting workforce growth above the 50 employee threshold in preparation for the costly mandate.
H.R. 2575 would provide some immediate relief for small-business owners and employees. According to the Congressional Budget Office (CBO), H.R. 2575 would reduce taxes on employers by $63.4 billion over the next ten years. For employees, the bill would prevent decreases in take home pay.
NFIB supports H.R. 2575 and will consider it an NFIB Key Vote for the 113th Congress. We look forward to working with you to protect small business as the 113th Congress moves forward.
President and CEO
Fix the Definition of Full-Time Employee