Healthcare Reform May End Up Discouraging Hiring

So just how much will the health care bill that President Obama signed on March 2010 affect small businesses? The answer is: quite a lot.


But those affects may not be as economically stimulating as its proponents would have hoped in that it may actually discourage hiring activies among the smallest of businesses in the US- ie those with fewer then 50 employees. This is of significance because these companies make up a whopping 96% of all businesses within the U.S.

Here’s a rundown of the legislation:

On one hand…

  • Beginging in 2014, states will have to set up Small Business Health Options Programs(SHOP). These health insurance pools will be established in an effort to alleviate insurance costs, by allowing small businesses to group together to buy health insurance and to get competitive pricing for insurance premiums


  • Begining in 2014, businesses with more than 50 employees will be required to either offer healthcare coverage or pay a penalty of $750 a year per full-time employee. This coverage will be required to meet minimum federal standards or else employers will face an additional penalty of $2,000 per employee.
  • Companies with fewer than 50 employees are exempt from the required health care coverage mandate.
  • Businesses that pay more than 50% of employees’ health benefits, have fewer than 26 employees, and pay average annual wages of less than $50,000 can claim a tax credit of up to 35% of the cost of premiums from the 2010 tax year through the 2013 tax year. The credit will go up to 50% in 2014 and can be used for two consecutive years after that.
  • Companies with more than 50 employees will not get any tax credits.

That many small companies will find ways to stay under 50 employees because of the insurance mandate, is a plausible scenerio. They might, for example, break up their operations into separate companies, or hire more part-timers. For these reasons the new federal healthcare law may discourage some small businesses from bringing in additional employees, and thus may end up inadvertantly impeding an economic recovery.

Sources: /3:22MDs go online to cut costs

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5 Interview Questions Which Will Get You Sued

Everyone knows that discrimination is illegal, but do you know the breadth of questions which are considered discriminatory in employment law? Small businesses often have a harder time in this area, because there is not always a HR (human resources) specialist on staff. Many traditional employment applications that you might be using have questions which are illegal and can ruin your small business in court. Applicants can sue you for compensatory and punitive damages as well as legal fees. If you have any doubt as to the legality of a question/requirement, whether in a job posting, on an application form, or as something you can ask in an interview, consult with an experienced employment attorney. However, these questions are definite NOs.

Don’t ask: When did you graduate high school or college?

This question is illegal because it discriminates in two ways: (a) age – their graduation date will give you an idea of how old they are; (b) minority – minorities may be less likely to graduate. You are also not allowed to ask if they DID graduate.

Instead: “Tell me about your educational background.” “Have you studied this (relevant subject) in a school setting? At what levels?”

Don’t Ask: Is English your native language?

This question is discriminatory against minorities, non-native Americans, and members of the international community with work permits.

Instead: Do you speak English fluently? Or, if the job requires someone to be multi-lingual, “Which languages do you speak proficiently?”

Don’t Ask: Are you a U.S. citizen?

This question discriminates against legal residents and others with work permits.

Instead: Are you legally able to work in the United States?

Don’t Ask: Are you married, have kids, planning to start a family?

These questions are illegal because they discriminate on the basis of gender. They do not have anything to do with the job. There are some lawyers who say that questions regarding children and child care (in terms of ability to work late) are acceptable, providing the same questions are asked of both male and female applicants.

Instead: “Do you have time for a full-time job?” or “Are you available to work overtime?” or “This position requires some travel, are you able to travel?”

Don’t Ask: Are you healthy? or How did you get your injury?

These questions are illegal because they can be discriminatory to those with disabilities.

Instead: “Are you able to fulfill the requirements of this position?”

If the person is visibly handicapped, you may be required to make accomadations to assist them in fulfilling the requirements of the job. The best thing to do is to not bring up the disability at all, and to consult an experienced employment lawyer about what you need to do.


If you do have specific requirements for a unique job description, your best bet is to use previous work experience as a measure of appropriateness to the position. This will generally allow you to remain “legal”. Questions regarding ability to obtain licenses, etc are acceptable. You should outline the requirements and ask the person if he/she meets them.

No matter what you ask, you need to maintain records which detail why each candidate was rejected or hired. This will provide security in the event of a threatened discrimination lawsuit.

Employment laws are frequently changed and updated, be sure to consult with a lawyer regarding any questions or potential issues.