How the GOP’s 40-Hour Workweek Bill Could Backfire
Policy + Politics

How the GOP’s 40-Hour Workweek Bill Could Backfire

Of the many, many things Republicans dislike about the Affordable Care Act, the law’s definition of a full-time employee as someone who works at least 30 hours per week has long been near the top of the list. The provision was put in place to prevent firms subject to the law’s employer mandate from dialing back workers’ hours just under 40 a week in order to avoid providing them insurance coverage.

The GOP’s complaint is that the law created an incentive for employers to cut workers’ hours even further in order to get out of providing health insurance. “It’s simply unfair to try and finance health care for some hardworking American people on the backs of other hardworking Americans through a reduction in hours and wages. That’s essentially what the Affordable Care Act has done,” Rep. Todd Young (R-IN) said at a Wednesday press conference with members of the House Republican leadership.

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Among the first acts of the new Republican-dominated 114th Congress when it convened this week was the introduction of the Save American Workers Act of 2015, which would rewrite the law to specify 40 hours a week as the definition of full-time employment. Young noted that the same bill had passed in the previous Congress with support from 18 Democrats.

The proposal provoked the second veto threat from the White House in two days. In a statement issued Wednesday, the Obama administration said the bill “would significantly increase the deficit, reduce the number of Americans with employer-based health insurance coverage, and create incentives for employers to shift their employees to part-time work – causing the problem it intends to solve.” A spokesman said the president would not sign the bill if it reached his desk, just as he’d veto legislation approving construction of the Keystone XL pipeline.

A Congressional Budget Office report released Wednesday backed up those White House claims, finding that if the proposal were enacted, 1 million workers would lose employer-subsidized health coverage. Of those, at least half would be thrown onto the Medicaid rolls, while the remainder would be forced to go without health insurance at all.

The bill would also increase the government’s health care costs by $53.2 billion over 10 years. All those costs would be added to the federal deficit, CBO points out.

Related: Obama Threatens Veto Before Congress Is Sworn In

Putting aside the budgetary and human costs of enactment, real questions remain about whether the 30-hour week really creates the incentives that GOP critics have decried.

Republicans have been claiming for years now that the provision – which doesn’t even take effect until this year – has been responsible for employers cutting workers hours. In a February 2014 report, though, CBO found “there is no compelling evidence that part-time employment has increased as a result of the ACA.” The CBO noted that, as the employer penalty component of the law hadn’t been put in place yet, there was no way of really knowing what effect it would have.

Others have raised concerns about whether the shift to a 40 hour requirement would do more harm than good for workers.

Writing in the conservative National Review, Yuval Levin explains the purpose of the 30-hour rule: “The idea was in part to encompass more employers and in part to limit the degree to which employers cut worker hours by putting the cut-off well below the number of hours that most workers put in—employers are less likely to reduce a worker’s load by 10 hours than by just 1 or 2 to avoid the mandate.”

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Levin cites recent research showing that there are many millions of workers in the U.S. who work exactly 40 hours a week or a little over, while a relative handful work between 30 hours and 35 hours. That means that if Republicans are concerned about workers seeing their hours cut by employers seeking to avoid the mandate, the worst thing they could do is to raise the bar to 40 hours a week. (Levin, to be clear, favors eliminating the employer mandate altogether.)

The GOP, however, appears to be moving ahead with the proposal. House Speaker John Boehner (R-OH) said Wednesday that the plan to “restore the 40-hour workweek” remains near the top of the Republican agenda.

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