Wednesday, April 26, 2017

What Indiana Trial Judges Need to Know about the Affordable Care Act

February 7, 2014 by Brenda Rodeheffer

County contracts and programs govern health care benefits for trial court employees. However, trial court judges in their roles as employers should still know some key things about the Patient Protection and Affordable Care Act of 2010, Pub. L. No. 111-148 § 5505, or “Obamacare,” but most commonly referred to as the Affordable Care Act or ACA.

There has been much discussion in the news about employers reducing full-time employees to part-time employees to avoid the necessity of providing healthcare. For the purposes of ACA only, a full-time employee is one who works on average thirty or more hours a week. ACA requires employers with fifty or more employees to provide healthcare insurance policies to their full-time employees. This means every court will need to provide healthcare coverage for all employees working an average of thirty or more hours.

When a discrimination charge is filed against a court, I have often been successful with the defense that the true employer is the judge. Many judicial staffs are so small that the judge does not meet the definition of an employer for discrimination actions. However, this defense does not work in an ACA action.

The Indiana Constitution is the source of the legal independence of the Courts from the executive, legislative and administrative bodies. Generally, in an employment action brought by a current or former judicial staff employee, the judge is the employer and the defendant. There are exceptions to this.

The payroll of court staffs (with the exception of Magistrates) is handled by either local executive branch or administrative agencies. In an action to enforce payroll or benefits, the lawsuit would not be just against the Court but also against the governmental body that handles payroll and benefits. Thus, if a state trial court failed to provide healthcare eligibility for an employee working thirty or more hours a week, the county would be sued, and liable, as well as the judge.

In Knoebel v. Clark County Superior Court No. 1, 901 N.E.2d 529 (Ind. App. 2009), the Court of Appeals held that both the judge and the county were proper and necessary party defendants when a former probation officer sued for back pay. The holding was based on In re Madison County Probation Officers’ Salaries, 682 N.E.2d 498, 500-02 (Ind. 1997) in which the Supreme Court held:

The Indiana Legislature has determined that probation officers serve at the pleasure of the courts that appoint them and that the salaries of probation officers are to be fixed by the courts. Ind. Code § 11-13-1-1(c). However, the funds for the salaries are to be paid out of the county or city treasury by the county auditor or city controller. Ind. Code § 11-13-1-1(c).

Because trial court employees’ benefit packages are funded by the county, city, town or township, the governmental unit that provides such benefit packages is a necessary party to any alleged violation of the ACA.

An ACA action involving the court and the county is most likely to occur when the court has an employee who works 30 hours or more some weeks, but is not a full-time employee. The ACA is enforceable by incorporating remedy provisions of ERISA. What constitutes a full-time employee varies from court to court when it comes to issues such as eligibility for vacation, sickness, and personal time, Public Employee Retirement Fund (PERF), and other benefits.

Regardless of how a court defines full-time employment, anyone who works thirty or more hours per week on average is a full-time employee for purposes of the ACA and is entitled to the employer’s health insurance. However, the ACA does not entitle the employee working 30 hours to anything more than the health insurance coverage. All other benefits can still be withheld depending upon the court’s definition of a full-time employee.

Thus, a court reporter working 32 hours a week may be eligible for health insurance only, while the court reporter next to her who works 35 hours a week may also be eligible for dental insurance, vision insurance, life insurance, disability benefits and PERF. A court may differentiate who receives benefit time, such as vacation and sick leave, based on the court’s own definition of what constitutes a full-time employee.1

If the court has an employee who works less than thirty hours per week on average, it will be important to keep scrupulous time records to prove that the employee is not hitting the thirty hour mark. Financial penalties for failure to provide insurance do not go into effect until 2015; however, those penalties will be based on the employer’s record of the time worked between October 2013 and October 2014.

If the court has an employee who is part-time and has been working close to or more than thirty hours per week, the judge needs to take steps immediately to reduce the employee’s hours so that the time worked averages less than thirty hours per week from October 2013 to October 2014. The alternative is to ask the county (city, town or township, if appropriate) to provide health care coverage for the part-time employee. Otherwise, the county will be at risk of incurring significant penalties based on its total number of employees, judicial and otherwise, for noncompliance with the ACA.

Now is the time for all employers to be more conscientious about recording actual time worked to prevent challenges under the ACA as well as other laws such as the Family Medical Leave Act (FMLA), the Fair Labor Standards Act (FLSA), and the Indiana wage statutes.

1 The county or state benefit plans for insurance programs may have contractual provisions with the insurers that require employees to work a certain number of hours per week to be eligible. Neither the court’s definition of full- time employment nor the ACA would change these contractual provisions.

If a judge needs assistance or advice about these matters, contact Brenda Rodeheffer at 317-234-3936 or