Benefits Insights, Winter 2016
In November, President Obama signed H.R. 1314, the Bipartisan Budget Act of 2015, which among other things repealed the auto-enrollment provision that the Affordable Care Act (ACA) added to the Fair Labor Standards Act (FLSA). Though the auto-enrollment had never been put into effect, employers may find the repeal a welcome reprieve from potential compliance issues.
The provision repeals the requirement that large employers offering health benefit plans need to automatically enroll full-time employees. Now it will not be mandatory for employers with more than 200 full-time employees to auto-enroll their employees in their health plan or any other benefits the employer offers. Auto-enrollment also will not be required for employees who don’t opt in or choose coverage after working 90 days.
Back in 2010, while addressing the auto-enrollment requirement within the ACA, the departments of Labor, Health and Human Services and the Treasury issued FAQs that recognized that employers were not required to comply with the auto-enrollment requirements until final regulations were issued. The rules, however, were never written, and the budget provision now ends the requirement before its implementation.