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It is arbitrary, but we have to draw the line somewhere.

It is not about money, tax is about money. This is about the extra work needed to accommodate for said obligations, it can involve several full time jobs, and the state considers that it is too much for a company of less than 50 employees.

Really, it is a lot of paperwork, and the more a company spends on paperwork, the less there is to pay employees.

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Could this be improved by a government agency where they do this paperwork for you at a per-employee cost if your company is under X employees (say 3x the limit at which the paperwork kicks in)?

The easiest improvement would be to remove the employer from the equation and just provide taxpayer-funded benefits to all. The main reasons employers are still involved are inertia followed by a concern that employees won't feel as obligated to stay in shit jobs.

Sounds like socialism, though. Can’t have that!

I think there are arguments to be made in favor of a more free market approach (or a less free market one.) At this moment we seem to have the worst of both worlds.

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