Affordable Care Act (ACA) Definitions

Definitions of Full-Time Employee, Part-Time Employee, and Variable/Seasonal-Hour Employee include faculty, staff, adjuncts, working retirees, temporary staff, and non-work-study students. Determinations for these ACA classifications will be made upon hire, during an employment status change, or after a prior measurement period.

Administrative Period

A period of time that allows the University to perform administrative duties related to counting hours and offering coverage. This is usually about 4-6 weeks and will take place after April 14 each year.

Affordable Coverage

Premiums for employee only medical plan coverage must not exceed 9.5% of employee’s compensation.

Break in Service

An employment break of at least four consecutive weeks, during which an employee of an educational organization is not credited with hours of service. A break in service impacts the measurement period as follows:

  • If an employee’s break in service is less than 26 weeks without any hours of service, ACA requires that the break in service period be excluded from the measurement period.
  • If an employee’s break in service is 26 weeks or more, ACA will allow the employer to treat them as terminated and rehired.
  • If an employee’s break in service, is at least four weeks, and it exceeds the number of weeks of employment immediately preceding the break in service during which the employee was not credited with any hours of service, ACA will allow the employer to treat them as terminated and rehired based on the “Rule of Parity.”

Full-Time Employee

An employee that works at least 30 hours per week, on average, throughout the year regardless of the number of jobs they have on the Reynolda Campus. Wake Forest is required to offer medical coverage to an employee that meets this definition of full-time employment.

Large Employer

An employer with at least 50 full-time employees.

Measurement Period

A period of time that allows the University to look back at the hours worked and determine eligibility for medical coverage. For ongoing employees, this is a 12 month period, April 15 – April 14. For new hires, this is an 11 month period based on the hire date.

Minimum Essential Value

The Medical Plan must pay at least 60% of cost of benefits.

Part-Time Employee

An employee that works less than 30 hours per week.

Stability Period

A period of time that, if eligibility criteria are met, an employee is offered medical coverage.

  • Ongoing employees: 12-month period, July 1 – June 30.If a change in employment results only in hours changing, ACA status will not be impacted for the remainder of the stability period.
    • Example 1: If an ongoing employee was considered part-time (not eligible for coverage) during their stability period, and their weekly hours change from 20 to 35, they would not be eligible for coverage for the remainder of the period.
    • Example 2: If an ongoing employee was considered full-time (eligible for coverage), during their stability period, and their weekly hours change from 37.5 to 20, they would still be eligible for coverage for the remainder of the period (a higher fringe rate may apply to all active jobs).

If a part-time position changes to full-time with benefits eligibility within the stability period, the individual would be eligible for coverage for the remainder of the period (beginning the date their position changes to full-time).

  • New hires: 12-month period, based on the hire date.If a part-time, variable-hour, or seasonal new hire transitions into a full-time position during their initial measurement period, the University will offer ACA medical coverage (beginning the date their position changes to full-time).

Variable/Seasonal-Hour Employee

An employee that works varying hours and for which the University is unable to determine reasonably expected hours in advance.

Compensation Definitions

Americans with Disabilities Act

Prohibits employment discrimination against individuals with physical and mental disabilities. An employer cannot discriminate against a qualified individual because of disability in regard to hiring, discharging, compensating, promoting, and other terms, conditions, and privileges of employment.


A job commonly found in the marketplace which is used as a reference point for making pay comparisons or measurements. Benchmark jobs have well-known and stable contents.

Base Pay

The rate paid by the hour, week, month, or year to an individual for the job performed. This does not include shift differentials, overtime, incentives, benefits, or any other pay element other than base pay.

Compa Ratio

The ratio between current pay to the salary range assigned to the job. A compa ratio is used to determine the relationship of an individual’s pay to the midpoint or some other control point of the salary range. It is also used to assess how an individual’s pay is moving through the assigned salary range.


All forms of financial returns and tangible services and benefits an individual receive as part of an employment relationship.

Compensation Philosophy

A set of principles that guide the design and administration of a compensation system toward supporting the university’s mission.

Direct Compensation

  • Base salary
  • Premium payments (overtime)
  • Contingent programs (commissions, gratuities, etc.)

Equal Employment Opportunity Commission (EEOC)

A commission of the federal government charged with enforcing the provisions of the Civil Rights Act of 1964, the Age Discrimination in Employment Act, the Equal Pay Act of 1963, and other fair employment practices legislation.

Equal Pay Act of 1963

An amendment to the Fair Labor Standards Act of 1938 prohibiting gender-related pay differentials on jobs that are substantially equal in skill, effort, responsibility, and working conditions unless the differences exist due to a seniority, meritor production-based pay system, or any other job-related factor other than gender.

Essential Functions

The primary job functions or tasks that an individual must be able to perform with or without a reasonable accommodation.

Exempt Job

A job not subject to the minimum wage and overtime provisions of the Fair Labor Standard Act. Generally this group includes executives, administrative/professionals, and outside sales individuals.

Fair Labor Standards Act (FLSA)

Federal legislation that sets the federal minimum wage, overtime pay, equal pay, record keeping and child labor standards for employees who are covered by the act and are not exempt from specific provisions.

Incentive Compensation

A reward that compensates an individuals for high performance or for achievement above and beyond the defined normal job requirements.

Indirect Compensation

  • Protection programs (social security, workers’ compensation, unemployment compensation, retirement plans, health, dental, life, accidental death, short-, and long-term disability insurance)
  • Paid leave, when individual’s are not at work (vacation, holidays, jury duty, military leave, etc.)

Intangible Compensation

Non-monetary rewards (work/life balance, on-the-job training, development opportunities, etc.).

Internal Equity

A standard that fairly establishes a pay level that corresponds to each job’s relative value to the organization.

Job Analysis

Systematic study of jobs to identify the observable work activities, tasks and responsibilities associated with a particular job or group of jobs.

Job Description

An official, written description of a job, which includes information regarding the general nature of the work to be performed and specific responsibilities, duties and qualifications.

Job Title

A specific name given to a particular job that is used to identify that position.

Market Pricing

A process that sets the rates (values) to be paid for a job to the organization’s best estimate of the current value for that job in the external marketplace.

Merit Increase

An adjustment to an individual’s pay that is based on performance as measured through a performance appraisal.

Non-exempt Job

A job subject to the minimum wage and overtime provisions of the Fair Labor Standard Act. Generally this group includes administrative support, technical/para-professionals, skilled craft, and service/maintenance jobs.


Under the Fair Labor Standards Act, working more than 40 hours in a workweek. Non-exempt individual’s must be paid at least one and a half times their normal wage rates or receive compensatory time for all hours worked in excess of 40 in any workweek.