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When Must an Employer Provide Benefits?

Are you an employer asking yourself, “when must an employer provide benefits?” If so, you’ll be happy to know that the answer isn’t all that complicated. There are several different acts, laws, and other factors that influence when you must provide benefits to your employees, but all of them include clear-cut guidelines to inform you when it’s necessary to provide benefits. Read on to learn more about the legal requirements of supplying your employees with benefits.

When Must an Employer Provide Benefits: Acts and Regulations

Employers, particularly those with a mix of part-time, full-time, or contracted employees, may ask themselves: “when must an employer provide benefits?” Answering this question is pretty simple: under the Affordable Care Act (ACA), an employer must provide health insurance to all full-time employees. Full-time under this act is defined as an individual whose workload averages 30 hours per week, or 130 hours per month. 

The Employee Retirement Income Security Act of 1974 (ERISA) is another federal act that employers must keep an eye on to comply with labor laws. The ERISA mandates that employers must provide employees that have earned 1,000 hours in 12 months the option of a retirement plan. For reference, 1,000 hours per year average 19.2 hours per week. This means that the act applies to both full- and part-time employees, which employers must be mindful of. 

The Family Medical Leave Act (FMLA) is an act that provides employees the right to medical leave following a medical emergency for themselves or a family member. Employees only gain this right if they work for a covered employer. An organization counts as a covered employer under the FMLA if it is one of the following:

  • A private employer with at least 50 employees
  • A government agency
  • A public or private elementary or secondary school

Additionally, for an employee to gain the rights granted by this act, they must first:

  • Work for a covered employer for a total of 12 months
  • Have worked 1250 hours or more during the 12 months
  • Work at a location in which the employer has 50 or more employees in a 75-mile radius

Certain restrictions and requirements exist for employers and employees within specific sectors, such as the aerospace industry. Consult the FMLA facts sheet for further specifics.

It’s always recommended that you contact a legal professional or human resources specialist before making decisions regarding your employees’ benefits packages. Contact Canal HR to see how we can assist you in staying in compliance with these laws and regulations.

Providing Employee Benefits: Best Practices

After asking, “when must an employer provide benefits,” you should ask yourself how an employer can provide the best benefits. Even if you’re falling within legal compliance regarding employee benefits requirements, striving to provide effective benefits is a great way to improve your employees’ experience with your company. 

 Salary is significant, but it isn’t everything: you should always strive to provide a competitive benefits package concerning the monetary compensation you offer and your competition. Ensuring that your employees are taken care of with comprehensive benefits will go a long way in recruiting and retaining your best employees. We’ve written a whitepaper on the topic- reference this to learn more about providing your employees with competitive benefits. 

Strive to consider your employees’ specific needs and goals. Incorporate employee feedback to improve your provided benefits and make them more applicable to your staff and their needs. Doing so will help cultivate a culture where employees feel cared for and listened to.

Incorporate health and wellness programs. Encourage a healthy lifestyle, provide nutritious snacks and other foods in the office, and hold events centered around employee wellness. A healthier workplace incurs fewer health insurance-related costs than one without these programs. In addition, providing accessible opportunities to engage in healthy behaviors can significantly reduce the burden of healthcare costs on your business.

Invest in Human Resources

Another way of increasing the efficiency of your benefits spending is to invest in an HR department that knows what they’re doing. Unfortunately, inexperienced, uninformed, or otherwise unqualified human resources professionals can end up causing your business to lose thousands of dollars due to inefficiencies or even legal issues. That’s why it’s essential to invest in your human resources department beforehand- spend the extra time and capital searching for the right people to avoid the aforementioned issues.

In fact, your business may not want to hire an endemic human resources department. Doing so can be costly, time-consuming, and risky. Another option is to outsource. Human resources cover a large portion of your business. Consult our blog post on the topic for more information on outsourcing.

Outsource Your HR With Canal HR

Navigating laws and regulations regarding benefits and other human resources issues can be difficult, risky, and time-consuming. That’s why it’s best to find someone that makes these issues their living; consider outsourcing your HR services to a professional organization like Canal HR.

Canal HR is a Professional Employer Organization (PEO) that has dutifully served the southeastern United States for three decades. Canal HR is committed to providing the best HR services in the region, allowing you time to get back to your business instead of worrying about the fuss surrounding employee benefits. Contact us today or visit our website to see if Canal HR is right for you.

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