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Massachusetts Governor Proposes Elimination of Fair Share Contribution Requirements

By Patricia A. Moran

On Tuesday, January 8, 2013, the Patrick administration proposed legislation that will repeal the Massachusetts Fair Share Law effective June 30, 2013.  In effect since 2006, the Fair Share Law requires companies with Massachusetts employees to either provide compliant medical coverage to full time employees, or pay a penalty of $295 per year per employee.

Employers throughout the commonwealth are excited about this news for several reasons.  First, the Fair Share Law is similar (but not identical) to the Federal Affordable Care Act’s employer mandate, due to take effect in 2014.  By proposing this law, the Patrick administration recognizes the administrative and financial burdens of compliance with both laws.

Further, many employers doing business in the Commonwealth, especially employers in the staffing, restaurant, home health and retail spaces, have found themselves targeted for aggressive Fair Share Law enforcement efforts.  Many of these employers, despite good faith efforts to comply with the law, have been ordered to pay the Fair Share penalty (or face a time consuming and expensive appeal process).  The repeal of the Fair Share law will encourage these employers to continue to do business in the Commonwealth.

For more information on the Affordable Care Act’s employer mandate and the Fair Share requirements, please contact our employee benefits attorneys and see our Health Care Reform webpage.

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Martha Zackin