There are costs and benefits.
The 50 employee cutoff relates to potential penalties. And it's equivalent employees - you can't get around it by having 49 FT and as many part-time as you want. Having 99 part time people to try to stay under 50 full time equivalent people is unlikely to be terribly efficient.
The people who wrote the law weren't stupid. They knew some employers were going to try to game it. That's why they consider lots of things...
http://www.fosterswi...on-Threshold.html
PPACA THRESHOLD FOR COVERAGE
Under the PPACA, employers with at least 50 full-time equivalent employees will be labeled as "large" employers. They will face penalties, beginning in 2014, if one or more of their full-time employees obtains insurance through a health care Exchange and qualifies either for a premium credit or a cost share reduction.
[IOW, it's a way to claw-back the cost of the subsidy that the company is trying to foist onto the public.]
A "large employer" is defined as one with more than 50 full-time equivalent employees during the preceding calendar year.
Both full-time and part-time employees are included in the calculation;
"Full-time" employees are defined as those working 30 or more hours per week;
"Full-time" excludes seasonal employees who work less than 120 days during the year;
Part-time employees hours as a group are included in the calculation also. Hours worked by part-time employees (those working less than 30 hours per week) are included by, on a monthly basis, dividing their total number of monthly hours worked by 120.
for example, a firm with 35 full-time employees (30+ hours), also has 20 part-time employees who all work 24 hours per week (so each employee who works 24 hours per week, works a total of 96 hours per month).
These part-time employees hours would be counted as the equivalent of having 16 full-time employees, as follows:
20 employees x 96 hours per month per employee /120
= 1920/120
= the equivalent of 16 "full-time" (30+ hours a week) employees.
HOW PENALTIES APPLY AND ARE CALCULATED
Regardless of whether a large employer offers coverage, it will only be potentially liable for a penalty beginning in 2014 if at least one of its full-time employees obtains coverage through a health care Exchange and qualifies for either a premium credit or a cost share reduction. To qualify for premium credits in an Exchange, the employee must meet certain eligibility requirements, including that the employeeÂs required contribution for self-only health coverage (through the employer) exceeds 9.5% of the employeeÂs household income, or if the plan offered by the employer pays for less than 60% of covered expenses.
In sum, part-time employees and their hours worked count toward the 50 full-time employee threshold, but if they obtain health insurance through an Exchange, that wonÂt trigger a penalty against their employer. If an employer does not offer insurance, but a full-time employee obtains insurance through a health care Exchange, the penalty calculation against the employer is $2,000 per year multiplied by the number of full-time employees, excluding the first 30.
If an employer offers insurance, but full-time employees enter the Exchange, the penalty is the lesser of (1) $3,000 annually for each employee entering the Exchange, or (2) the penalty calculated for employers not offering insurance at all ($2,000 per year x the number of full-time employees, excluding the first 30).
If the company has insurance that is appealing enough that no FT workers go into the exchange or no FT employees qualify for a subsidy, then there is no penalty.
http://www.nfib.com/...date-calculations
Employer Mandate Penalties Depend on Four Questions.
(1) Is this employer Âlarge or ÂsmallÂ? (2) If the employer is large, does it offer qualified health insurance to virtually all full-time employees (FTs)? (3) How many, if any, FTs receive subsidies in the health insurance exchanges? (4) If the employer is large and has at least one subsidized FT, how much does it owe in annual penalties? The different calculations use different sets of data from varying subsets of employees.
In this context, a large employer is one where FTs and full-time equivalents (FTEs) sum to 50 or more. Again in this context, an FT is one who works 130 hours per month or more  roughly 30 hours per week. Each 120 hours per month of part-time and seasonal labor comprises one FTE.
The health insurance offered by employers must be Âqualified, meaning that it meets requirements laid down by federal and state authorities. Among other things, qualified coverage must cover at least 60% of employees healthcare costs on average. For small employers, policies must cover Âessential health benefits, as defined by federal and/or state authorities.
For an FT to qualify for subsidies in the individual insurance exchanges, several things must be true: (1) The employeeÂs household income must fall within a certain range. (2) The employer does not offer coverage that is judged qualified and affordable for this employee. (3) The employee must actively reject the employerÂs coverage and request subsidies from the exchange. Note: To avoid penalties, the employer must offer coverage to FT employees dependents, but there is no requirement that their coverage be affordable.
If an employer doesnÂt offer FTs insurance (or offers non-qualified/inadequate coverage), and if at least one FT receives federal insurance subsidies in the exchange, the business will pay $2,000 per FT (minus the first 30). Example: a business with 50 FTs, two of whom are subsidized, would pay $40,000 = $2,000 x (50 Â 30).
If an employer offers insurance and at least one FT receives insurance subsidies, it pays the lesser of $3,000 per subsidized FT OR $2,000 per FT (minus the first 30). So an offering employer with two subsidized FTs would be fined $6,000. For a 50-employee employer with 14 or more subsidized FTs (above the tipping point for an employer of this size), the penalty would be $40,000.
The point, it seems to me, is to make sure that companies with more than 50 FTE make insurance available to all their FTs. The government doesn't want FTs dropping out of company plans and turning to subsidies in the exchanges.
So if a company has 51 FTEs and it only offers insurance benefits to some of the FT employees, then they will have to pay a penalty if even one of those FT people gets insurance in the exchange and gets a subsidy. If, on the other hand, they don't offer insurance at all, they'll still have to pay a penalty if a FT employee enters the exchange and gets a subsidy.
Tyrrany!!!11
There are obviously ways for companies to get around the penalties. One good one is to pay their employee enough so that they don't quality for the subsidy. Another is to make their insurance benefit good enough that none of the FT people are tempted by the exchange (even if they qualified for a subsidy).
It looks like a single person working at a company that does not offer coverage could make at most $33,030 in 2014 before losing any subsidy:
http://kff.org/inter...0&child-tobacco=0
For a household with 4 people including 2 kids under 21, the income threashold is just below $46,000. (There are huge subsidies for the family below that cutoff.)
tldr; it's not the PPACA requiring insurance coverage for large employers that leads to the potential for a penalty. It's having a FT going into the exchange and qualifying for a subsidy that can lead to a penalty.
FWIW. HTH.
Cheers,
Scott.