Contributing employers to multiemployer plans were relieved by the Treasury Department’s interim guidance stating that they will not be subject to the employer shared responsibility payments under the Affordable Care Act (“ACA”) with respect to employees for whom they contribute to a multiemployer plan that provides minimum value, offers dependent child coverage and is affordable. Since relief is provided for all employees for whom contributions are made to a multiemployer plan, regardless of whether coverage is offered, the question of whether an employee is full-time is largely irrelevant to the relief.  That led many employers to believe mistakenly that they do not have to determine the full-time status of these employees, allowing these employers to avoid the administrative complications associated with tracking employees who, in many industries, are variable hour employees.  Unfortunately, this belief is not well-grounded.

Rather, it appears that contributing employers still need to determine which employees are full time in order to properly comply with IRS reporting requirements.  Under the ACA, employers, plans and health insurance issuers are required to report certain information to the IRS and furnish certain information to participants annually, pursuant to Code Sections 6055 and 6056.  The IRS recently released drafts of Forms 1094-C and 1095-C, which employers may use to report this information and furnish to participants, and draft instructions for the forms.  While these draft forms and instructions leave many open questions regarding how contributing employers to multiemployer plans will complete the forms, they clearly require employers to report the number of their full-time employees.  They must also calculate whether minimum essential coverage has been offered to the applicable percentage of full-time employees in their workforce.

While this reporting is not required until early 2016 and much remains subject to further clarification, employers contributing to multiemployer plans who thought they did not have to worry about capturing this information should begin implementing procedures to ensure that they are capturing the necessary information, since the form filed in 2016 will relate to 2015 employment and coverage.

Contributing employers should review draft forms 1094-C and 1095-C and monitor future changes to the draft forms and instructions, and multiemployer plan administrators should be prepared to field questions from contributing employers regarding these reporting requirements.