How are employers with a partly unionized workforce affected by the employer mandate?

Minneapolis attorney Monica Kelley, specialist in advising employers on employee benefits packages, shares how employers and unions can be impacted by the employer mandate of the Affordable Care Act.

Contact Monica Kelley

Email: [email protected]

Phone: (612) 632-3367

Transcript:

There are a few ways that an employer with a unionized or partly unionized workforce may be affected. The first and probably the most obvious but it bears repeating is that benefits are one of the items that are subject to negotiations. So if you want to make changes to your benefit program you’re probably going to need to talk to the union, plan ahead for that. And then there are two situations in which you might be providing health coverage to your unionized workforce, one might be that you provide a special plan for them as the employer. So I, company X that you have a special plan for my unionized workforce or it could be that you’re contributing to a plan that is for all of the union members in the area. So say for example, you have bricklayers working for you, they have a bricklayers plan for all the bricklayers that are in the state of Minnesota, and you contribute as an employer to that plan that would be a second way.

In both ways a couple of considerations to be taken into account are first that your union employees count as part of your workforce. So when you’re deciding whether you’re subject to the act and have to provide coverage and when you’re trying to calculate what your penalties might be if you fail to provide coverages you have to count those union employees whether they’re being covered under your plan or another plan or not being covered at all, so that’s sort of a basic point.

And then the third point is that there is some relief for employers. If you’re providing coverage by contributing, in my earlier example to the bricklayers plan, as long as that plan is letting people in when it’s supposed to and it provides affordable coverage the fact that you contribute is enough to avoid penalties for you as an employer.