Obamacare Has Been Delayed Until 2015. What Does This Mean For Your Small Business?
Small business owners have been concerned about the healthcare mandate of the Affordable Care Act that required businesses to provide health insurance for their employees. While a majority of Americans are in favor of businesses providing health insurance for their employees, politicians have struggled to properly decide how large a company should be before it is subject to the law’s requirements. While there are plenty of businesses that could afford to provide health coverage to their employees and choose not too, the mandate was also criticized because it did little to protect smaller businesses who couldn’t afford the added cost of employee benefits. Though small business owners had been complaining for the better part of a year, there was no response from the administration and, dreading the January 2014 deadline, they began to prepare.
So it came as a great shock last week when the White House announced it would be delaying implementation of the central and controversial mandate, giving small business owners already struggling with cash flow problems until 2015 to provide health insurance for their full-time employees. For some businesses and their employees, the decision came too late. Restaurant chain Fatburger has already begun cutting worker hours to 25/week (5 less than the 30-hour designation the Affordable Care Act defines as “full-time”). An earlier decision would have saved these employees a sizable chunk of money and save the owners a major headache. According to Fatburger CEO Andy Wiederhorn, “All it’s doing is causing confusion, anxiety and the workers are paying the price. Now, the mandate’s a moving target. It’s very, very challenging.”
What Your Small Business Should Do
The administration’s decision is a reprieve, not a pardon. Though small business owners have been given another year to prepare, the mandate is inevitable and you will need to be prepared. Now is the time for you to start planning your finances. Can you afford the extra cost? Start putting money away now, and look for new sources of revenue to cover the difference. Now is also the time to start looking at your overhead and deciding if you have redundancies. Each full-time employee you hire will mean another policy to purchase, so try to merge job duties and make your staff as efficient as possible. Try to do more with less.
If you don’t think you can make do with fewer employees, consider hiring staff part-time. Employees working 30-hour weeks will be considered full-time for the healthcare mandate, so part-time or contract workers (not technically employees) could be useful. What plans do you have for your small business? Leave your comments below!
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