The Patient Protection and Affordable Care Act might just as easily be called the Employment Lawyers’ Full Employment Guarantee Act. This unduly complex and confusing piece of legislation gives every indication that it was created by a dysfunctional legislature overrun by hoards of high-priced special-interest lobbyists. The sad result is that the rest of us are left trying to understand who is covered, how the law will be implemented, and how much it will cost.
What does it matter to a buyer of contingent worker services?
The easy, head-in-the-sand answer is, “It’s not my problem.” Determining eligibility, selecting plans, pricing, penalties and group buying plans are employer responsibilities, and the employer of your contingent labor is the staffing supplier, not you. But starting very soon how your suppliers deal with those questions will affect your program’s costs. If labor costs go up, your costs will go up. Death and taxes are inevitable, and according to the the Supreme Court, it is a tax.
But underlying the hard facts and cost issues is a question that is rarely asked, and even less rarely given serious consideration: What is an employee?
Using the broadest possible definition and putting aside all legal distinctions (core, temporary, contract, contingent, independent contractor, day-laborer, part-time, full-time, for the few minutes s/he’s checking out your groceries even the clerk at the supermarket is your employee), employees are fungible, interchangeable units of labor — no more, no less. That’s the Adam Smith, laissez faire view popular — even gospel — with many. An employee works, and you pay as little as possible. How much you pay is a simple measure of supply and demand, always remembering that less is better. How well the employee lives and what he or she does with his or her pay is not your problem. That’s capitalism.
Or, is an employee a member of your community: someone with whom you share a common interest in a common welfare?
If you choose the second definition, your concerns about the Affordable Care Act may become less, “What will it cost me?” and more, “How can this thing be implemented to provide the most benefit to the most people most equitably?” It is likely that some labor costs will go up because of the legislation. That is because many “employees” will move from the first definition to the second. Am I happy that my favorite items on the dollar menu may go up to $1.10? No, but I am happy that more members of my community will have access to healthcare.
Consider that in most “worst-case” scenarios (i.e., from the employer’s view, the most costly), the cost of contingent labor may increase by $2,000 per year for each employee (the employer “penalty” for providing no insurance). On a percentage basis, that’s less than the 10 cents extra I’ll have to pay for my burger.
An economy — a society — is a complex organic thing, not a Darwinian machine. (And even Darwin acknowledges a place for altruism in nature.) Sometimes, one member sacrifices a little to benefit another. Frequently, the benefit given to another returns as a greater dividend to the society at large.
As an employment law specialist, it is my job to learn and understand the details of the Patient Protection and Affordable Care Act. I revile the politicians and special interest lobbyists who made it so unwieldy, unintelligible and complex. I acknowledge the imperatives of the hard-core capitalists who want only to minimize their costs, but I also recognize the attempt — however flawed — to extend some societal good to the community of my “employees.”
It’s a matter of perspective.
This post first appeared in Contingent Workforce Strategies 3.0, April 24, 2013.