The Part-Time Shortcut
If you have continuously offered minimum value coverage and an employee moves to a position expected to average under 30 hours, you may move that employee to monthly measurement from the first day of the fourth full month.
The three things to know.
The Conditions
Continuous offer of minimum value coverage, a change to a position reasonably expected to average under 30 hours, and an employee who actually averages under 30 hours in each of the three full months after the change.
The Timing
After the three months the employee is treated under the monthly method from the first day of the fourth full calendar month following the change.
Why It Exists
It prevents an employer from being locked into a long stability period for someone whose job genuinely changed.
Sources: 26 CFR § 54.4980H-3. General information, not legal advice.
A worked example.
A Move to a 20-Hour Role
An employee covered under a continuous offer of minimum value coverage moves to a role expected to average 20 hours a week. Her stability period still has eight months left.
What the Rule Produces
After three full months in the new role in which she averages under 30 hours, the employer may treat her under the monthly method from the first day of the fourth full month. That ends the long hold on her full-time result.
Four steps to apply it.
1. Confirm the offer
Check coverage was continuous and met minimum value.
2. Track three months
Record hours in each month.
3. Apply the shortcut
Move her to monthly measurement from month four.
4. File the record
Keep hours and dates.
Where it goes wrong. Using the shortcut when the continuous offer or minimum value condition was not met.
The questions that come up next.
What if hours rise in the three months?
The shortcut does not apply, and the stability period continues to govern.
Does the shortcut require a written record?
Not in the regulation, but you will need records of the offer and of the hours in each month to rely on it.
Does it apply to new hires?
It addresses employees already covered by an offer when they change positions. Check the regulation’s wording for the facts at hand.
What if hours exceed 30 in one of the three months?
The shortcut does not apply, and the stability period continues.
Is this optional?
Yes. An employer may choose to rely on it, and must meet its conditions.
Plan-specific questions belong with ERISA counsel, and we will bring them in.
Related pages on the look-back method.
A Returning Employee Who Declined
If a continuing employee comes back during a stability period after declining an offer for the whole period, you are still treated as having offered coverage.
Restaurants and Hospitality
Shift swaps, weather and events move hours week to week in restaurants and hospitality.
The Full Look-Back Guide
Every rule, example and source behind this page, in one place.
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