How the Affordable Care Act Affects Temp Work

The Affordable Care Act has changed the way companies do business in so far as how they classify and schedule their employees. This is especially true for those companies that are near the 50 employee threshold where the company must provide health coverage to all its full-time workers. Temp agencies have become more popular during this transition period, and the implementation of the Affordable Care Act affects temporary employees in multiple ways.

The implementation of the Affordable Care Act has been notoriously difficult, resulting in new deadlines and exemptions right from the start. Larger companies are better equipped to stay on top of all the changes and new rules thanks to legal teams and HR specialists who are paid specifically to make sure the company stays in compliance. However, small and mid-size companies don't have the resources to dedicate to research proper implementation of the Affordable Care Act, so many are turning to temp agencies for assistance. One advantage the ACA offers temp workers is a likely increase in temporary work. Small companies can avoid hitting the 50 employee threshold by filling some positions with a rotating supply of temp workers to keep the number of full-time workers low.

However, this does not get the temp agencies off the hook. If you work more than 30 hours per week for the temp agency, even if it is at different companies doing dissimilar jobs, it becomes the responsibility of the temp agency to provide you health insurance through the ACA. This can work against you because the temp agency itself may start restricting hours to avoid crossing the full-time threshold.

Another disadvantage to temporary employees concerns the likelihood of gaining full-time employment through the company they are temping for. Whereas some companies used temp agencies as a means of locating new hires in the past, they now rely on temp agencies to avoid hiring new workers. This also buys those companies more time to figure out how best to move forward under the ACA. Temp agencies sometimes function as consultants for smaller companies figuring out how to staff properly to stay within Affordable Care Act compliance.

This has been healthy for the temp agencies, who saw large stock increases as the Affordable Care Act went into effect. The anticipated supply increase resulted in multiple temp agencies receiving extra capital, giving them the opportunity to hire more temp workers. While full-time positions in other companies are harder to get after the ACA implementation, depending on the market, temp agencies are hiring more people to meet higher demand.

The ACA offers advantages and disadvantages to the average worker. While the intent is to bring health coverage to more people across the country, a side effect has been companies trying to sidestep the requirements by keeping their full-time employees and number of hours per employee under the legal limit. The Affordable Care Act has therefore offered more opportunity to temp workers as they fill the void.

(Photo courtesy of Vichaya Kiatying-Angsulee / freedigitalphotos.net)