Independent Contractor Compliance Blog - by Collabrus™

Over the past several years San Francisco’s Health Coverage Law (Chapter 14, San Francisco Health Care Security Ordinance) has been awaiting its fate in the court system.

A local restaurant had filed a suit claiming the ordinance passed by the city council in 2006 was not legal under federal law.  Without thrashing the details of the ensuing legal battle, the issue seems to have finally played itself out.  On September 30, 2008, the Ninth Circuit ruled that the San Francisco Ordinance is legal.  The Ninth Circuit ruled, in short, that San Francisco’s law is not in conflict with federal law.

The cost is going up for 2009.

According to the language set forth in the original law, the amount of required contributions that employers must make towards their employee’s health care plan is rising.  Beginning January 1, 2009, San Francisco’s required health care rates will increase by 5% over last year.  This puts the costs at:

• Employers with 100 or more employees will be required to spend at least $1.85 per hour per covered employee.
• Employers with 20 to 99 employees will have to spend at least $1.23 per hour per covered employee.
• Employers with 19 or less employees are still exempt from the requirement.

The cost is also rising in other ways

In 2008, this requirement only applied to employees working at least 10 hours per week in the city.  Effective in 2009, the threshold has dropped to employees who work eight or more hours per week.