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How to Handle Leaves of Absence under the ACA
The Patient Protection and Affordable Care Act (ACA) requires applicable large employers (ALEs) to offer full-time employees health coverage, or pay one of two employer shared responsibility penalties. An ALE is an employer with 50 or more full-time or full-time equivalent employees (for 2015, this threshold is 100). A full-time employee is an employee who works 30 hours or more a week.

Leaves of absence can make it difficult for an employer to determine if or how an employee counts toward the ALE threshold of 100, as well as determining if an employee is considered full time and must be offered coverage.

Under the ACA, any hour for which an employee is paid or entitled to payment must be counted as an hour of service. This includes:
  • An hour worked
  • Vacation
  • Holiday
  • Sick time
  • Incapacity (including disability)
  • Layoff
  • Military duty
  • Paid leave
Exceptions to the rule exist for:
  • Hours worked by a student as part of the Federal Work-Study Program (or a similar state or local program)
  • Hours which are considered income from sources outside the United States
  • Hours performed as a "bona fide volunteer"
For more detailed information, please click here  for the complete guide..
Please Note:
This information is general and is provided for educational purposes only. It reflects UBA's understanding of the available guidance as of the date shown and is subject to change. It is not intended to provide legal advice. You should not act on this information without consulting legal counsel or other knowledgeable advisors. September 23, 2015.
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