Health Insurance Exchange Notices – Who is enforcing their distribution?

By October 1^st, 2013 health exchange notices are required by law to have been distributed to all employees.  These notices to employees either explain the health insurance the employer provides or, if the employer does not offer coverage, refers employees to their state’s health insurance exchange to purchase insurance.  Examples of employee notices are available via the first link at the bottom.  (If you are a Cardinal client we will be assisting with this requirement.)

Getting a notice out to a large number of employees can be daunting, especially if you want to prove that you have fully complied by reaching every employee.  The Department of Labor (DOL) advises sending the notice via first class mail.  I have even heard it suggested that employees sign for the notice.   Working backwards, I prefer to look at the worst case scenario.  From what I have been able to ascertain the Affordable Care Act (ACA) amended the Fair Labor Standards Act (FSLA) requiring the notice but did not include a penalty.  Below  in the first link is a recent DOL guidance on the notices to employees as well as an excerpt from the second link where the DOL notes that “…it is the view of the Department of Labor that, until such regulations are issued and become applicable, employers are not required to comply….”  I have looked but have been unable to find a penalty associated with a failure to comply with the law.  That does not mean there is not one out there nor that between now and October 1^st that the Federal government cannot implement penalties.  Additionally, I would not advise ignoring a law.  What I do advise is reviewing the DOL’s recommendations in the first link and then documenting your procedures as to how you have tried to issue these notices to all employees.  Taking extra steps like getting signatures or sending the notices by certified mail is overkill but there is no reason you cannot do so if you are overly concerned. 

Looking at another worst case scenario, I thought a disclaimer is prudent by stating this article is not legal advice nor am I advising anyone to break the law regardless of the possible lack of the consequences.

The DOL's website regarding employee notices on FLSA 18B.

http://www.dol.gov/ebsa/newsroom/tr13-02.html

The DOL's website regarding enforcement on FLSA 18B.

http://www.dol.gov/ebsa/faqs/faq-aca11.html

Q1: When do employers have to comply with the new notice requirements in section 18B of the FLSA?

Section 18B of the FLSA provides that employer compliance with the notice requirements of that section must be carried out "[i]n accordance with regulations promulgated by the Secretary [of Labor]." Accordingly, it is the view of the Department of Labor that, until such regulations are issued and become applicable, employers are not required to comply with FLSA section 18B.