HR ADVISOR


We are about to hit 50 employees, what are some of the HR compliance areas I should consider?

When your company grows to 50 or more people, here are some regulations to discuss with your legal counsel to ensure HR compliance going forward.

Affordable Care Act

Many of the provisions in the Affordable Care Act (ACA) are dependent on employer size. Two major regulations that begin when you hit that 50 employees mark are:

  • Employer Shared Responsibility Provision - Employers with 50 or more full-time and/or full-time equivalent (FTE) employees must follow the Employer Shared Responsibility Provision. Employers with 50 or more full-time and FTE's that don’t offer affordable health insurance to its qualified employees may be required to pay a fee.

  • ACA Reporting - Once you have 50 or more FTE employees, you also have new responsibilities for information reporting. This IRS Q&A details the pertinent information about your potential reporting requirements.

FMLA

The Family Medical Leave Act (FMLA) applies to any private sector employer who engages in commerce, industry, or other activities that affect commerce, and who have 50 or more employees.

The FMLA requires employers provide up to 12 weeks of unpaid, job protected leave a year for their employees.

Affirmative Action

Employers with 50 or more employees and $50,000 in government contracts must have an Affirmative Action Plan.

EEO-1 Reporting

The US Equal Employment Opportunity Commission requires all federal contractors who have 50 or more employees to fill out and submit the EEO-1 Report. The report requires employers to provide a count of employees by job category and then by ethnicity, race, and gender.

Form 5500

Form 5500 is used to collect data on employees’ benefits, including insurance and pension plans.

The form needs to be completed by any employer who sponsors a plan subject to the Employee Retirement Income Security Act (ERISA). Plans subject to ERISA generally include medical, dental, 401(k), and retirement plans.

If your plan has under 100 employees, you only need to fill out the short version of the form: Form 5500-SF.

State Laws

Depending on your state, you could also be subject to new regulations once you have 50 employees. For example, the state of California requires employers with over 50 employees to provide sexual harassment training and education every two years.

Final Tips

You can find a longer list of regulations you may need to consider through the Small Business Association here.

Ultimately, scaling your business can be exciting! At the same time, it’s important to work with your legal counsel to ensure compliance with relevant federal and state regulations.

Helpful Links:

What Factors are Involved in ACA Compliance? - Zenefits

ACA Tax Provisions for Small Employers - IRS.gov

Getting Started with ACA Compliance - Zenefits

Lauren Perales
HR Advisor
Posted on Feb. 4, 2017, 12:13 a.m.
Disclaimer: The answers and information on HR Answers serve as basic guidelines and are for informational purposes only. While our goal is always to provide useful content, we are unable to provide legal, tax, or fact-specific human resources advice and encourage you to speak with your legal counsel, tax advisor, or human resources professional to understand how this information applies to you.