President Obama is using the Internal Revenue Service to silence employers unhappy about Obamacare. That’s the hidden purpose behind the employer mandate delay announced on February 10th.
The administration released 227 pages of mind-numbing regulations ridiculously billed as making “ the compliance process simpler and easier” for employers. Hidden in the gobbledy-gook (on pages 125-6) is a requirement that employers sign a statement to the IRS, meaning under penalty of perjury, that they have not reduced the number of employees or cut hours to shield themselves from the costs of Obamacare.
The administration called it a mandate delay. Nonsense. The delay applies only to a miniscule fraction of mid-size employers (50-99 full time workers) who currently don't provide coverage. They’re mostly in retail and hospitality, and they will be allowed to continue not offering it. Their workers (about 1.9 million) plus dependents will either stay uninsured or sign up with Obamacare. The administration is hoping for the latter.
But nine out of every ten mid-size employers already provide coverage, and for them last Monday’s announcement was about hush money, not delay. They are required to continue to provide coverage, and worse, most will have to switch to the costlier Obamacare package of benefits, because that’s the only plan for sale. Either state insurance regulators or insurance companies have already said no to renewing noncompliant plans.
The only thing these employers get from last week’s rule change is a “stop complaining” bribe. The Affordable Care Act says employers have to pay a whopping $3,000 each time a worker goes onto the Obama exchanges and gets a taxpayer subsidized plan. Now the administration is offering to waive that penalty. Employers who want this deal must attest to the IRS that they haven’t laid off workers or cut hours to squeeze under the 99-worker threshold.
Here’s where Big Brother starts running your business. The IRS will forgive changes “because of the sale of a division, changes in the economic marketplace in which the employer operates, terminations of employment for poor performance, or other similar changes.” It’s none of Big Brother’s business why you hire or fire.
The president wants employers to keep quiet before the 2014 election. In 2013, the headlines screamed about layoffs and reduced hours as CEOs and managers strategically maneuvered to minimize the cost of the employer mandate.
Astoundingly, in the first seven months of 2013, 77% of new hires were part time. Obama rushed to stop the damaging news by announcing last July that he would delay the employer mandate until January 1, 2015. Oops! That date is approaching.