Definition of ‘full-time’ work varies widely, debate on shifting Obamacare threshold to 40 hours points out

America’s 40-hour work week took center stage Thursday as House Republicans made it the focal point of their latest effort to eviscerate Obamacare.

The House passed a bill 257-172 saying employers covered by the Affordable Care Act would have to offer health insurance to workers regularly working 40 hours a week. The current standard is at least 30 hours a week.

Republicans contend that the 30-hour threshold causes businesses to cut workers’ hours and cut jobs. They say a 40-hour rule would create jobs. Democrats disagree, seeing greater economic harm overall by reducing the number of ACA-covered workers.

Those who are championing the change also are saying it will “restore” the 40-hour full-time work week.

But many employers and labor law experts don’t see what, exactly, needed restoration. In the United States, what actually constitutes a full work week has traditionally been a matter of employer discretion.

At the Kansas City law firm of Spencer Fane Britt & Browne, for example, 37½ hours a week — not 40 hours — is the definition of full-time employment. That’s what it takes to be offered employee benefits there.

At workplaces across the country, “full-time” can mean 40 hours a week. Sometimes, it can mean 35. Or something else.

Except for setting 40 hours a week as the line beyond which overtime must be paid to eligible employees, U.S. laws haven’t strictly defined full-time work.

But then came the Affordable Care Act, which injected a new number into law: 30.

The health insurance law said employees who work 30 hours a week must be considered “full-time” and must be offered health insurance by employers covered by the law.

Congressional Republicans see raising the 30-hour threshold as a way to limit the ACA. Since enlarging their majority in the House in the midterm elections and taking over the Senate, they’ve been emboldened to mount attacks on the law.

The bill passed Thursday now goes to the Senate, where the Democratic minority is expected to block the measure.

If the Senate should pass the bill, it would still need President Obama’s signature, and the president’s budget office said Wednesday that he planned to veto the bill if it reached his desk.

In the House, Republicans would need 290 votes to override the veto, but Thursday’s vote indicated there wouldn’t be enough support to override.

While the latest challenge to Obamacare was framed by Republican leaders as “restoration” of the 40-hour work week, it may surprise many Americans to know that “there’s no law that says the standard work week is 40 hours,” said Sue Willman, an employment law attorney at Spencer Fane.

Willman is a nationally recognized expert in U.S. labor law, including the Fair Labor Standards Act, which set many labor standards. From her vantage point, the latest effort to dismantle Obamacare is more “unnecesssary controversy” than an assault on a foundation of the U.S. workplace.

“Basically, employers can define ‘full-time’ any way they want,” Willman said. “And they can define it separately for each kind of employee benefit they offer, whether it’s vacation days or sick days or health insurance.”

The Congressional Budget Office said the health care law’s definition probably would cut about 1 million U.S. workers out of employment-based health insurance. The losers could be employees who work at least 30 hours a week for covered employers but don’t work as many as 40 hours.

The law requires that employers offer health insurance to full-time employees or pay a penalty, starting this year for businesses with 100 or more full-time employees and in 2016 for employers with 50 to 99 full-time employees.

Terry L. Berger, a former district director in Kansas City for the U.S. Department of Labor, isn’t sure there’d be a quick employee benefits fallout if the health care law was changed.

Since leaving the Labor Department, Berger has been a consultant advising employers about labor laws. He said his clients “generally complain about government dictates” over how they run their businesses, but the letter of the law typically doesn’t motivate them to offer — or not offer — employee benefits.

“Well-established business people who are looking down the road to keep their operations successful are taking the approach of providing the best benefits they can afford,” Berger said. “They’ll offer health benefits if they can. The people trying to get by as cheaply as they can will be the ones who try not to pay overtime, too. This has always been the case with labor laws.”

Support for changing the ACA’s full-time definition to 40 hours comes from the National Restaurant Association, the National Retail Federation, the U.S. Chamber of Commerce and some trade groups that represent companies with large shares of part-time workers.

One early effect of the health care law has been for some workplaces to cut part-time workers’ hours to under 30 so that they wouldn’t meet coverage mandates. The change to 40 hours would let employers assign more shift hours without the required health benefits hassle or expense.

Rep. Todd Young, an Indiana Republican and the bill’s main sponsor, said the 40-hour threshhold would “remove this perverse incentive to reduce hours and wages when they are most needed by our hourly workers.”

Those favoring the change to a 40-hour definition for health insurance purposes applauded the House vote.

On behalf of the International Franchise Association, president Steve Caldeira said that “restoring the 40-hour work week definition is a common-sense legislative fix to the Affordable Care Act that will put more money in the pockets of hard-working Americans and allow small businesses the flexibility they need to manage their workforce.”

But Democrats and labor supporters who back the ACA’s 30-hour requirement express doubt that employers would increase part-timers’ hours if the coverage threshhold moved to 40. Rather, they’re afraid more part-time workers would be working without health care benefits.

“They shouldn’t masquerade this as an assault on the work week,” said Judy Ancel, director of the Worker Education and Labor Studies Program at the University of Missouri-Kansas City. “Americans have been losing the 40-hour work week because of under-employment (part-time hours) and over-employment (overtime) for years now.”

This story was originally published January 8, 2015 at 5:36 PM with the headline "Definition of ‘full-time’ work varies widely, debate on shifting Obamacare threshold to 40 hours points out."