New DOL FAQ says No Penalty on Employers Who Do Not Send Exchange Notices to all Employees

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Yesterday, (September 11, 2013),  the Department of Labor (DOL) issued a new Frequently Asked Question (FAQ) – clarifying that employers subject to the Fair Labor Standards Act (FLSA) should provide all employees a written notice about the Health Insurance Marketplace (“Exchange Notice”) by October 1, 2013, but that there is no penalty under the law on an employer that does not send out the Notice of Coverage Options.   (The FAQ is at


Industry experts would encourage all employers who are subject to FLSA to send Exchange Notices to all employees by the October 1 deadline, even if no penalty applies, however, the decision is up to each employer.  We are moving forward with preparing and sending the notices to COBRA beneficiaries  – as planned unless you inform us otherwise by September 18, 2013.


To simplify the process, we will eliminate Part B, and instead issue only Part A:  General Information. (Part B is optional, at this time, and would generally be used for active employees, if required)


The full DOL FAQ is below,  and the direct link to The FAQ is below


FAQ on Notice of Coverage Options

Q: Can an employer be fined for failing to provide employees with notice about the Affordable Care Act’s new Health Insurance Marketplace?

A: No. If your company is covered by the Fair Labor Standards Act, it should provide a written notice to its employees about the Health Insurance Marketplace by October 1, 2013, but there is no fine or penalty under the law for failing to provide the notice.

The notice should inform employees:

  • About the Health Insurance Marketplace;
  • That, depending on their income and what coverage may be offered by the employer, they may be able to get lower cost private insurance in the Marketplace; and
  • That if they buy insurance through the Marketplace, they may lose the employer contribution (if any) to their health benefits

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