The world of higher education has long seemed like the land of ideal working conditions—tenured professors teaching classes on a leafy campus, with sabbaticals and such as the norm—but like the rest of the working world, even post-secondary institutions have had to come to grips with modern economic realities.

The impact of employees staying longer in the workforce has hit academic institutions hard, as many colleges and universities also try to figure out how to effectively track part-time instructors’ hours or provide retirement help to increase lifetime income for all employees.

And the increased need for health regulatory reporting due to the Affordable Care Act—along with changes to retirement preparedness efforts—have left unforeseen side effects on higher education.

In 2015, the ACA’s employer mandate takes effect for all employers; this includes employees that work in the varied world of academia.

“There is range of different kinds of employees that other employers don’t have to consider, and that raises concerns for the colleges and universities,” says Edward I. Leeds, counsel at Ballard Spahr. “If [schools] provide particularly rich coverage to employees, whether they are faculty or staff, that’s going to be a concern for everybody. We will have to see what comes between now and 2018.” \

Leeds alludes to the ACA’s excise tax — a 40% tax on employers that provide high-cost health benefits to their employees. The tax comes into effect in 2018.

Related Practices

Employee Benefits and Executive Compensation
Health Care Reform
Higher Education
Labor and Employment