Executive Summary: Effective January 1, 2015, certain employers became subject to the employer mandate of the Patient Protection and Affordable Care Act (ACA), and thus subject to liability under the ACA Employer Shared Responsibility provisions. Specifically, effective January 1, 2015, employers with at least 100 full-time employees, including full-time equivalents, became subject to a penalty if: 1) they fail to offer minimum essential coverage to substantially all of their full-time employees and their dependents, 2) if they fail to offer coverage that provides minimum value and is affordable to all full-time employees and their dependents, and 3) any full-time employee receives a tax credit or subsidy through a government health care exchange.[1]
While much has been written about the proper method for calculating full-time equivalent employees under ACA, and the merits of opting to pay ACA penalties rather than offering coverage, comparatively little has been written about the ACA whistleblower protection provision and its interplay with the employer mandate. ACA prohibits an employer from discharging or in any manner discriminating against any employee with respect to compensation or other terms, conditions or privileges of employment because the employee (or an individual acting at the request of the employee has) -
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Received a credit or a subsidy for purchasing health benefits;
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Provided, caused to be provided, or is about to provide or cause to be provided to the employer, the federal government, or the attorney general of a state, information relating to any violation of, or any act or omission the employee reasonably believes to be a violation of Title I of the ACA;
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Testified or is about to testify in a proceeding concerning such violation; Assisted or participated, or is about to assist or participate, in such a proceeding; or
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Objected to, or refused to participate in, any activity, policy, practice, or assigned task that the employee (or other such person) reasonably believed to be in violation of any provision of ACA or any order, rule, regulation, standard or ban under Title I of the ACA.
DOL published procedures for handling ACA whistleblower complaints on February 13, 2013. Under the regulations, an aggrieved employee (or representative) must file an administrative complaint with the Occupational Safety and Health Administration, Whistleblower Directorate, within 180 days following an adverse employment action taken in whole or in part based upon the employer's knowledge of the employee's participation in ACA-protected activity. To date, no DOL administrative tribunal has recognized a whistleblower claim based upon an adverse employment action caused by an employer's alleged failure to comply with Title I of the ACA. Indeed, an administrative law judge dismissed just such a complaint on December 19, 2014, because the mandate was not in effect at the time of the alleged protected activity or adverse employment action. See Porter v. Housing Authority of Columbus, Georgia, 2015-ACA-00001, Decision and Order Granting Respondent's Motion for Summary Decision (ALJ, Dec. 19, 2014).
Background Information: Michelle Porter was employed as a Family Self-Sufficiency Coordinator by the Housing Authority of Columbus, Georgia (HACG) until her termination on January 16, 2014. She was employed as a "durational" employee – i.e., one whose employment and compensation were funded by a HUD grant. She filed an ACA whistleblower complaint with OSHA on August 19, 2014. Her complaint alleged that, in September 2013, she asked HACG questions about a letter she had received which stated that durational employees were ineligible for participation in HACG's group health insurance plan (which was offered solely to regular, full-time employees). She further alleged that because she disagreed with information contained in the letter, she refused to sign an acknowledgement stating that she understood and agreed with its terms. She claimed that after refusing to sign the acknowledgment, she received her first unsatisfactory performance evaluation and a significantly lower annual bonus based on the unsatisfactory review – adverse employment actions that she alleged resulted from her objections to HACG's interpretation of her ACA rights.
OSHA dismissed the complaint as untimely because it was filed more than 180 days following the date of termination. Porter appealed the decision to the DOL Office of Administrative Law Judges on October 10, 2014, claiming that her complaint was timely because she had attempted, unsuccessfully, to file timely complaints within the 180 day limitations period with Office of Inspector General for the Department of Housing and Urban Development (HUD), the White House, the DOL Wage and Hour Division and the Equal Employment Opportunity Commission. HACG moved for summary judgment.
The ALJ declined to rule on the timeliness issue, instead assuming, without deciding, that Porter's inquiries to the White House were sufficient to trigger the equitable tolling doctrine. On the merits, the ALJ interpreted Porter's OSHA complaint as falling under the second category of protected activity identified in the statute. The ALJ granted summary judgment for HACG, holding that it could not be held liable for retaliation prior to the effective date of employer mandate.
Some legal commentators have disagreed with the ALJ's interpretation. They argue that the ACA whistleblower provision protects an employee who voices a complaint to an employer based on a reasonable belief that the employer violated the Act – even if no violation actually occurred. Porter has until January 19, 2015 to request review by the DOL Administrative Review Board. Alternatively, she could dismiss her DOL administrative complaint and file a de novo complaint in federal court, where she could qualify to have her case heard by a jury if she is able to survive preliminary dismissal and summary judgment motions proceedings.
Future Implications
The Porter case illustrates only one of several ways in which an employee may gain whistleblower protection under ACA – but it illustrates the most likely scenario for claims that will be brought in 2015. In 2016 and beyond, employers may also begin to receive whistleblower retaliation complaints based on adverse employment actions taken after receiving notice that one or more of their employees qualified for a tax credit or a subsidy for purchasing health benefits through a health exchange. It should be noted that an ACA complainant can terminate DOL proceedings after a complaint has been pending for 180 days and file a judicial complaint seeking a jury trial.
[1] This provision was originally scheduled to take effect January 1, 2014, but its implementation was delayed by federal regulations issued in February 2014. These regulations provided transition relief for employers with at least 50 but fewer than 100 employees by providing that they will not be required to comply with the employer mandate until January 1, 2016. Other requirements must be satisfied to qualify for transition relief. Employers with at least 100 employees were required to comply with this provision beginning January 1, 2015.
