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Ms. COLLINS. Mr. President, today I am offering legislation correcting Obamacare's definition of a ``full-time'' employee to allow employees to work 40 hours a week without triggering penalties on the businesses that hire them. Currently, Obamacare defines an employee working just 30 hours a week as ``full time.''
Because Obamacare uses an unreasonably low threshold of 30 hours a week to define ``full time'' employees, some businesses are restricting their employees to no more than 29 hours of work per week, to ensure that their workers are considered ``part time'' for purposes of Obamacare. This is a consequence of the substantial penalties Obamacare imposes on businesses that reach a threshold of 50 ``full time'' employees, unless they provide expensive health care coverage which many small businesses simply can't afford.
The penalties imposed by Obamacare begin at $40,000 for businesses with 50 employees, plus $2,000 for each additional ``full-time equivalent'' employee. These penalties serve as a huge disincentive for businesses to grow or add jobs, particularly for firms close to the 50-job trigger.
One Maine business I know has 47 employees, and it would like to hire more but won't because of these onerous penalties. If more businesses follow suit, millions of American workers could find their hours, and their earnings, cut back. According to the Bureau of Labor Statistics nearly 10.5 million Americans work between 30 and 35 hours per week. Another 9.7 million work between 35 and 40 hours per week. My bill will help protect these Americans who may otherwise find their hours curtailed and their earnings cut as a result of Obamacare.
Obamacare's definition of a ``full time'' employee is completely out-of-keeping with standard employment practices in the U.S. today. According to the American Time of Use Survey published by the Bureau of Labor Statistics, the average American works 8.8 hours per day, which equates to 44 hours per week. Under Obamacare, working only 30 hours a week is considered ``full-time''--nearly one-third lower than actual practice.
Likewise, the Obamacare definition of ``full-time'' employee is one-quarter lower than the 40 hours per week used by the GAO in its study of the budget and staffing required by the Internal Revenue Service to implement Obamacare. In that report, the GAO described a ``full time equivelant,'' or ``FTE,'' as: ``a measure of staff hours equal to those of an employee who works 2,080 hours per year, or 40 hours per week for 52 weeks.''
During consideration of the Budget resolution last month, the Senate adopted my amendment calling for legislation setting a more sensible definition of a ``full time'' employee for purposes of Obamacare penalties. That amendment was endorsed by the National Association of Manufacturers, and the National Education Association. The fact that these two organzitions--typically thought of as bookends on the political spectrum--would agree that Obamacare's definition of a ``full-time'' employee is broken illustrates how out-of-step it truly is.
Under my bill, a ``full time'' employee would be someone who works a 40-hour week. This is a sensible definition in keeping with actual practice. I urge my colleagues to support it.