Obama administration delays employer mandate until 2016

The Treasury Department and Internal Revenue Service announced this afternoon that it will delay enforcement of Obamacare’s employer mandate until 2016 for businesses with less than 100 employees.

The employer mandate is a provision of Obamacare that requires businesses with 50 or more full-time employees, defined as someone who works at least 30 hours a week, to offer health insurance benefits or face a punitive, $2,000 per worker tax.

The provision was supposed to take effect at the beginning of 2014, as required by statue. Businesses expressed concern about the mandate, and many responded by cutting hours or dropping health benefits. The Treasury Department unilaterally delayed enforcement of the provision last summer, making the announcement in a blog post.

The Treasury Department announced today that it is delaying enforcement of the provision for businesses with 50 to 99 full-time employees until the beginning of 2016.

“While about 96 percent of employers are not subject to the employer responsibility provision, for those employers that are, we will continue to make the compliance process simpler and easier to navigate,” said Mark Mazur, Assistant Secretary for Tax Policy.

“Today’s final regulations phase in the standards to ensure that larger employers either offer quality, affordable coverage or make an employer responsibility payment starting in 2015 to help offset the cost to taxpayers of coverage or subsidies to their employees,” he added.

The final regulations released by the Treasury Department also ensure that volunteer firefighters will not be counted as full-time employees, which had been a concern for communities that depend on volunteers for the essential public service.

The change is likely to draw criticism, for three reasons. One is because the administration has, yet again, ignored statutory requirements in the text of Obamacare. As noted, the employer mandate was supposed to take effect at the beginning of 2014 before it was unceremoniously delayed last year.

Secondly, it’s another example of the administration moving the goal posts on the law. Businesses had warned that the employer mandate was causing disruption, and they pushed to raise the definition of a full-time worker from 30 hours a week to 40 hours.

The administration has stuck by the law, almost religiously, even though mounting delays of various provisions undermines its arguments that the law won’t have a negative impact on the economy.

Lastly, it’s obviously a political move with control of the Senate on the line in the 2014 mid-term election, a narrative upon which the Republican National Committee has already seized.

“The Obama Administration is failing to deal with ObamaCare because it is simply bad law,” said RNC Chairman Reince Priebus. “After refusing to accept bipartisan changes to the law, the administration is unilaterally making it up as they go along.”

“Whether you are an American worker, employer, a union member or healthcare provider, you’ve had enough. What’s the remedy? Elections matter. Democrats may try hiding from President Obama on the campaign trail, but when it comes to his signature accomplishment, ObamaCare, each Democrat Senator up for reelection this year helped make it a reality,” he added.


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