What Should Employers Do With Exchange Notices?

As an employer, you may receive a notice from a health insurance Exchange that an employee has applied for coverage and is eligible for a premium assistance tax credit. These Exchange notices—and its relationship to the assessment of employer shared responsibility tax penalties under the Affordable Care Act (“ACA”)—have generated both confusion and concern among employers. Understanding how to respond to the notices and taking proactive measures can prevent triggering unnecessary payroll tax audits or worker retaliation claims under the Fair Labor Standards Act (“FLSA”).