ABC joined 42 other national and state organizations in signing onto a letter
to Treasury Secretary Steve Mnuchin asking the department to address the confusing and conflicting definitions of “seasonal worker” and “seasonal employee” that are included in the Affordable Care Act (ACA) and its implementing regulations.
The letter points out that due to the varying definition of “seasonal,” small businesses continue to struggle with determining their employer size and employer shared responsibility requirements. When complying with the ACA, it is possible for the same worker to be a “seasonal worker” for the purpose of determining employer size, but not be considered a “seasonal employee” under an employer’s shared responsibility obligations.
The letter explains that the various definitions of “seasonal” include:
- A “seasonal worker” is defined as “a worker who performs labor on a seasonal basis as defined by the secretary of labor” in determining whether an employer is treated as a small business or a large business, known as an applicable large employer (ALE).
- The ACA’s “seasonal worker exception” is used for determining ALE size. The regulation allows employers to examine if seasonal workers put the employer over the 50-employee threshold for 120 days or less. This determination is made on an annual calendar-year basis.
- If determined to be an ALE for the calendar year, the employer must determine to whom coverage must be offered; otherwise they face a potential penalty. Options include using either a monthly measurement method or an optional look-back measurement method. Under the optional look-back measurement method, “seasonal employee” is defined as an “employee who is hired into a position for which the customary annual employment is six months or less.”
In the letter, ABC and the other organizations requested an open dialogue with Secretary Mnuchin to discuss possible approaches to simplifying the various definitions to the extent allowed by regulation.