S.1188 — Forty Hours Is Full Time Act of 2013

113th Congress, First Session
The Library of Congress

To amend the Internal Revenue Code of 1986 to modify the definition of full-time employee for purposes of the individual mandate in the Patient Protection and Affordable Care Act.

June 19, 2013

Ms. COLLINS (for herself and Mr. DONNELLY) introduced the following bill; which was read twice and referred to the Committee on Finance

To amend the Internal Revenue Code of 1986 to modify the definition of full-time employee for purposes of the individual mandate in the Patient Protection and Affordable Care Act.

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,

This Act may be cited as the `Forty Hours Is Full Time Act of 2013′.

Section 4980H(c) of the Internal Revenue Code of 1986 is amended–
(1) in paragraph (2)(E), by striking `by 120′ and inserting `by 174′; and
(2) in paragraph (4)(A) by striking `30 hours’ and inserting `40 hours’.



ObamaCare’s Definition of a Full-Time Job Needs Revising

By Sen. Joe Donnelly (D-Indiana) and Sen. Susan Collins (R-Maine)
The Wall Street Journal, July 18, 2013

In Lafayette, Ind., a school district cut the hours of 200 support staff to no more than 29 per week. In Bangor, Maine, the school system is preparing to track and cap the number of hours worked by substitute teachers to ensure that they don’t work more than 29 hours a week. Elsewhere, in Portland, Maine, a small business reduced a part-time employee’s hours from 35 to 29.

We are hearing reports like this from across the country. Why is this happening?

It’s happening because under the Affordable Care Act a “full-time employee” is defined as anyone working an average of 30 hours a week, rather than the traditionally accepted 40-hour work week. Employers with more than 50 full-time employees or full-time equivalents will be required to provide their employees with health insurance or potentially face a financial penalty, essentially a fine.

This rule is causing a growing number of employers to cut the hours of their workers, and according to one study by the UC Berkeley Labor Center, at least 2.3 million workers are at risk. This provision of the health law is not in the best interests of the country, and it needs to change.

As the economy shows modest signs of recovery, we should be working with employers to encourage additional job growth. Yet we are hearing from small businesses, public school systems and nonprofit organizations, that they are cutting employee hours and forgoing additional hiring in an effort to ensure that they are in compliance with the law.

To address this problem, we have introduced the “Forty Hours is Full Time Act of 2013.” It defines a full-time employee for the purposes of complying with the Affordable Care Act as someone who works an average of 40 hours per week, or 174 hours per month for full-time equivalents.


Many employers are in the process of reducing employees’ hours to under 30 per week in order to avoid the requirement to either provide health insurance for their workers or pay a penalty. Not only do these employees end up with no health insurance, they also have their paychecks reduced by about 25 percent. Since most already have modest incomes, this reduction in pay can create severe financial hardship. What can be done?

Senators Collins and Donnelly seem to define the primary problem as the reduction in income that these employees face. By changing the definition of full time work to 40 hours per week for purposes of the Affordable Care Act (ACA), employers will be able to preserve most of their workers’ incomes by employing them for 39 hours, while being relieved of the responsibility of providing health insurance. The employees will still be able to have health insurance since they can then purchase individual plans in the state insurance exchanges. Little does it matter that these are low-actuarial value plans with high-deductibles, and inadequate subsidies to protect family budgets. Oh. Maybe that won’t work so well.

It is not simply the definition of a work week that is wrong. It is the fundamental ACA financing model that is terribly flawed. Trying to fix it with patches such as redefining the work week will never get us where we need to be. We have to change the financing model. (Yes, we need single payer.)