ORLA Advocacy Update

Schrader Pushes to Simplify Key Area of Healthcare Law

Rep. Kurt Schrader (D-Ore.) is a lead sponsor on a recently introduced bill that aims to make part of the health care law easier for small businesses to understand. It targets an area that has been a major point of confusion for restaurants as they seek to navigate the complex law: its two definitions of seasonal employees.

The Simplifying Technical Aspects Regarding Seasonality (STARS) Act, H.R. 5213, which was recently introduced in the U.S. House of Representatives, aims to clear up the confusion. The bill, submitted by a bipartisan group of representatives, would make it so the law has only one definition of “seasonal employee.”

“This bi-partisan bill will make our healthcare system work better for businesses and employees. It simplifies a complex area of the new healthcare law that is causing great uncertainty for our nations small businesses and farmers. The American public has been crying out for us to work together to solve the problems facing our country. This bill is a step in that direction,” said Schrader, who joined Reps. Jim Renacci (R-Ohio), Lynn Jenkins (R-Kan.) and Jim Costa (D-Calif.) to introduce the bill in July.

The Oregon Restaurant & Lodging Association (ORLA) has been working with lawmakers, its members, and the National Restaurant Association (NRA) to secure changes to the healthcare law. ORLA and the NRA recently organized a meeting between restaurant and hotel operators and Senate Finance Committee staff to discuss how the healthcare law is affecting the ability of hotels and restaurants to grow, innovate and provide opportunities for hundreds of thousands of Oregonians. ORLA, along with the NRA and 50 other state restaurant associations and business groups, sent a letter to the House of Representatives in support of the STARS Act.

Currently, the healthcare law has two definitions of seasonal employment–“seasonal worker” and “seasonal employee.” The “seasonal worker” definition is used to determine if an employer is an “applicable large employer,” and subject to the law’s employer shared responsibility and employer reporting requirements. The “seasonal employee” definition is used by an “applicable large employer” with the look-back measurement method to determine which employees must be offered coverage.

These conflicting definitions complicate the “applicable large employer” (ALE) determination process, which requires employers to determine all employees’ hours of service, including seasonal workers, each calendar month. They then must calculate the number of full-time equivalent employees per month, and average each month over a full calendar year to determine the employer’s status for the following calendar year.  If the employer averaged 50 or more full-time equivalent employees for 120 days or less and the workers that pushed them over 50 were seasonal workers, then the seasonal worker exception applies and the employer can be considered a small employer.  

The STARS Act would provide clarification and relief for restaurateurs by giving “seasonal employee” only one definition: an employee who works less than six months in customary, annually recurring work at certain periods of time in the year. The bill would also remove seasonal employees from the calculation employers must make to find out if the law considers them a “large” employer.

“We applaud Congressman Schrader's leadership in aiding small businesses in Oregon and across the country to better comply with the healthcare law,” said Bill Perry, vice president of government affairs of the Oregon Restaurant & Lodging Association. “As it stands, the law’s inconsistent and confusing definitions of ‘seasonal employment’ make determining employment size extremely difficult. The STARS Act will help simplify the process and provide restaurateurs much-needed assistance and clarification.” | CHRISTOPHER DOSCHER, NATIONAL RESTAURANT ASSOCIATION