Examples

For an employer who is not an educational employer, has been in existence for the prior calendar year, and whose tax year begins in January, 2016.

The employer is measuring the hours of an employee that is resuming services after an absence. The employee's prior period of employment was for 3 years and the employee was absent for 6 weeks. Because the employer is not an educational employer and the employee was absent for less than 13 weeks, this employee is treated as an ongoing employee.

This employer may choose to measure the employee's hours in one of two ways: by calendar months or by using the weekly rule. This employer uses the weekly rule and specifies that the first day of the calendar month is included in the first week of the weekly periods.

That means the periods the employee's time is measured on begins December 27th, 2015 (the Sunday before January 1st, 2016). The last day of the month is not included in the periods, unless the last day falls on a Saturday (for example: April 30, 2016 and December 31, 2016 are both Saturdays). Additionally, some periods will have 4 weeks while others have 5.

To count hours, for the periods with 4 weeks: if the employee has at least 120 hours of service, the employee is full-time for that month. For periods with 5 weeks: if the employee has at least 150 hours of service, the employee is full-time for that month.

The employer measures on these periods:

• 150 hours for December 27, 2015 - January 30, 2016
• 120 hours for January 31, 2016 - February 27, 2016
• 120 hours for February 28, 2016 - March 26, 2016
• 150 hours for March 27, 2016 - April 30, 2016
• 120 hours for May 1, 2016 - May 28, 2016
• 120 hours for May 29, 2016 - June 25, 2016
• 150 hours for June 26, 2016 - July 30, 2016
• 120 hours for July 31, 2016 - August 27, 2016
• 120 hours for August 28, 2016 - September 24, 2016
• 150 hours for September 25, 2016 - October 29, 2016
• 120 hours for October 30, 2016 - November 26, 2016
• 150 hours for November 27, 2016 - December 31, 2016

If the employee has at least as many hours listed for each period, the employee is a full-time employee for that month and the employer will need to offer the employee coverage.

For an employer who is not an educational employer and has been in existence for the prior calendar year.

This employer uses a standard measurement period of 12 months beginning January 1, 2016. The employer does not use payroll periods for the standard measurement method. The employer uses an optional administrative period of 31 days and the stability period is also 12 months.

For an ongoing employee, the employer would measure the hours of service for each month during the standard measurement period of January 1, 2016 – December 31, 2016. If the employer averages at least 30 hours of service during this period, the employer will need to make an offer of coverage by February 1, 2017 – the beginning of the stability period.

This employer hires a new employee on June 7, 2016, that is a variable hour employee (the employer cannot determine at the time of hiring whether this employee will average 30 or more hours of service per week). For this employee, the employer will use an initial measurement period to measure the employee's hours of service. The initial measurement period can begin on any day from the employee's hire date through July 1, 2016. The employer chooses to measure beginning July 1, 2016, and decides that the initial measurement period and the stability period will be 6 months – the initial measurement period is then July 1, 2016 – December 31, 2016.

If this employee averages at least 30 hours of service per week during that period, the employee will need to make an offer of coverage no later than January 9, 2017 – the beginning of the stability period associated with the initial measurement period. The stability period begins on January 9, 2017 because the days between the employee's hire date and the start of the initial measurement period are included in the employer's administrative period (June 7, 2016 – June 30, 2016).

An optional period you select that is no longer than 90 days that begins immediately after the end of a measurement period and ends immediately before the start of the associated stability period.

The administrative period also includes the period between a new employee's start date and the beginning of the initial measurement period, if the initial measurement period does not begin on the employee's start date.

Generally, coverage is affordable for an employee if the employee's required contribution of the annual premium for self-only coverage does not exceed an applicable percentage of the employee's household income for the year. Depending on the employee's household income, the applicable percentage is between 2 and 9.5 percent.

With respect to a calendar year, an employer that employed an average of at least 50 full-time employees (including full-time equivalent employees) on business days during the preceding calendar year.

An employee that has previously been employed by you, but experienced a break in service (for example, due to termination and rehire or unpaid leave). Depending on the rehire and continuing employee rules, these employees can be treated as a new employee or as an ongoing employee.

Generally, with respect to a calendar month, an employee who is employed an average of at least 30 hours of service per week.

The hours for which an employee is paid, or entitiled to payment, for the performance of duties for the employer; and each hour for which an employee is paid, or entitled to payment by the employer for a period of time during which no duties are performed due to vacation, holiday, illness, incapacity (including disability), layoff, jury duty, military duty or leave of absence.

Certain hours are excluded from hours of service; for more information, see the ESRP Regulations.

As part of counting hours of service for your employees: 130 hours of service in a calendar month is treated as the monthly equivalent of at least 30 hours of service per week, and this 130 hours of service equivalency applies for both the look-back measurement method and the monthly measurement method for determining full-time employee status.

Under the lookback measurement method: A period of at least three but not more than 12 consecutive months that is used to determine the full-time status of your new employees. A new employee that averages at least 30 hours of service per week during the initial measurement period is treated as a full-time employee through the end of the associated stability period that follows.

The limited non-assessment period for certain employees refers to the limited period during which an employer will not be subject to an assessable payment under section 4980H(a) and in certain cases 4980H(b), with respect to an employee as set in the ESRP Regulations:

• The transition rule for an employer's first year as an applicable large employer.
• Under the monthly measurement method, when an employee is first otherwise eligible for an offer of coverage.
• Under the look-back measurement method, a non-variable, not seasonal, and not part-time employee's initial full three calendar months of employment.
• Under the look-back measurement method, new variable hour, seasonal, or part-time employees determined to be employed on average at least 30 hours of service per week.
• Under the look-back measurement method, a change in employment status during the initial measurement period for new variable hour, seasonal, or part-time employees.
• The partial calendar month where an employee's employment begins or terminates as it applies to the payments under 4980H(a) and 4980H(b).

An eligible employer-sponsored plan provides minimum value only if the plan’s share of the total allowed costs of benefits provided to the employee under the plan (as determined under guidance issued by the Secretary of Health and Human Services) is at least 60 percent.

Under the look-back measurement method, a new employee is an employee who has been employed for less than one complete standard measurement period.

Under the monthly measurement method, a new employee means an employee who has not previously been employed.

Under the lookback measurement method, an ongoing employee is an employee who has been employed for at least one complete standard measurement period.

Under the monthly measurement method, an employee who has been continuously employed by you without any breaks in service.

With respect to any calendar month 1/12 of $2,000, adjusted for inflation.

This amount is multiplied by a certain number of your full-time employees for a calendar month to calculate the actual payment.

With respect to any calendar month, 1/12 of $3,000 – adjusted for inflation.

This amount is multiplied by a certain number of your full-time employees for a calendar month to calculate the actual payment

Under the lookback measurement method: A period you select that immediately follows and is associated with a standard measurement period or an initial measurement period (and if elected, the administrative period associated with that standard measurement period or initial measurement period).

Under the lookback measurement method: A period of at least three but not more than 12 consecutive months that is used to determine the full-time status of your employees. Employees that average at least 30 hours of service per week during the standard measurement period are treated as full-time employees through the end of the associated stability period that follows.

Generally, an employee that, based on the facts and circumstances at the employee’s start date, you are unable to determine whether the employee is reasonably expected to be employed on average at least 30 hours of service per week during the initial measurement period because the employee’s hours are variable or otherwise uncertain.

A waiting period is the period that must pass before coverage for an individual who is otherwise eligible to enroll under the terms of a group health plan can become effective. If an individual enrolls as a late enrollee or special enrollee, any period before such late or special enrollment is not a waiting period.