What To Expect When Your Business Reaches 50 Employees (4 Steps for Compliance)
Adding employees to your organization is a sign of growth and success. But once your company reaches the threshold of 50 employees, it also means that there are additional federal and state regulations you’ll need to comply with.
Key Regulations To Consider
It’s crucial to be aware of the additional federal and state regulations that will apply to your organization. Below are three of the most common ones that your organization should be aware of when you reach 50 employees.
Family and Medical Leave Act (FMLA)
The FMLA applies to private-sector employers with 50 or more employees within a 75-mile radius. It requires employers to provide up to 12 weeks of unpaid, job-protected leave for eligible employees for certain family and medical reasons.
An employer is not immediately covered under the FMLA upon reaching the 50-employee threshold. The employer must maintain 50 employees on the payroll for 20 or more calendar workweeks (not necessarily consecutive) in either the current or preceding calendar year.
Affordable Care Act (ACA)
Employers with 50 or more full-time and/or full-time equivalent (FTE) employees must comply with the employer shared responsibility provisions. This includes offering affordable health insurance to qualified employees.
ACA reporting requirements, including Form 1095 reporting to the IRS, also come into effect once your organization reaches 50 employees.
Equal Employment Opportunity (EEO-1) Reporting
The Equal Employment Opportunity Commission (EEOC) requires private employers with 100 or more employees or government contractors with 50 or more employees to submit the EEO-1 report, which provides a count of employees by job category, race, ethnicity and gender.
EEO-1 reporting is designed to collect workforce demographic data in order to ensure compliance with federal equal employment opportunity laws, promote workplace diversity and prevent discrimination.
The First Steps Towards Compliance
Knowing the regulations is only the start. Ensuring compliance with these regulations is essential to avoid potential penalties and to maintain a positive and lawful workplace environment.
Consider taking these practical steps towards compliance.
Review Required Postings and Notices
As your company reaches the 50-employee threshold, these regulations require you to provide certain notices to your employees.
- FMLA Notice – Employers must post a notice explaining the FMLA provisions and provide information about the procedures for filing complaints about FMLA violations.
- ACA Notices – Employers must provide notices about the Health Insurance Marketplace and the availability of coverage options.
- EEO Poster – The “Equal Employment Opportunity is the Law” poster must be displayed, informing employees of their rights under federal anti-discrimination laws.
You can learn more about the notices your specific organization is required to provide (and you can even download and print them) from the DOL’s Workplace Posters page.
Review and Update Your Company’s Policies
Review your organization’s employee handbook and leave policies, and ensure that they are updated to comply with FMLA requirements.
When an employee asks for leave under FMLA, you’ll be required to provide them with specific forms, such as the Notice of Eligibility and Rights & Responsibilities (Form WH-381) and the Designation Notice (Form WH-382), so it’s best to become familiar with these documents and have them readily accessible.
It’s also important to review your health insurance offerings with your broker and providers to meet ACA standards in order to avoid IRS penalties.
Prepare for Reporting Requirements
Familiarize yourself with the EEO-1 reporting requirements, and ensure your payroll system can collect the necessary data (race, ethnicity, job category, etc.) and can generate EEO-1 reports.
Prepare for ACA Form 1095-C reporting by gathering the required information (such as employee details and coverage offered) and understanding the submission and deadline process. Ensure your payroll provider can generate and file Forms 1095-C and 1094-C.
Communicate With Employees
Inform your employees about their rights and benefits under FMLA and ACA. Consider hosting a learning session or providing documentation to explain:
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- Eligibility for employer-sponsored health plans
- Available coverage options and associated costs
- How to access additional coverage through the Health Insurance Marketplace
Managers should be trained to recognize situations that may qualify for FMLA leave—such as serious health conditions or caregiving responsibilities—and know how to respond appropriately by referring employees to HR.
Additionally, be sure to provide your team with the contact information for an HR professional or benefits administrator at your organization who can answer questions about health coverage or leave policies.
Learn More About HR Compliance for Your Organization
Adding to your employee count can be an exciting step for your business, but the regulations are complex—and they’re always changing. To learn more about the regulations that apply to your specific business (and which steps you should take towards complying with them), contact your Warren Averett advisor directly, or ask our HR Solutions team to reach out to you.
