To assist our clients who will be implementing the counting hour rules, the Compliance team of Arthur J. Gallagher & Co. has developed this article outlining key considerations for employers. 

For applicable large employers, tracking and understanding each employee’s hours of service is required in order to make an informed decision on who should be offered coverage pursuant to the Employer Mandate – “pay or play” decision. In addition,knowing an employee’s hours of service will assist employers with their IRS reporting obligations under Sections 6055 and 6056 of the Patient Protection and Affordable Care Act (“PPACA”).

While employers must follow specific rules when counting hours of service, they do have some leeway in the application of the rules. As such, to assist employers who are trying to set appropriate parameters for counting hours of service, we have created the following questions to help them through the process of establishing measurement, administrative, and stability periods under the look-back method and facilitating use of the monthly measurement method.

Updated January 2018.

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