Obamacare may force White Castle to seek part-timers
The maker of onion-steamed mini-burgers says it won't cut current hours or benefits, but can't afford to cover newcomers.
Treading ground already well worn by Papa John's (PZZA), Wendy's (WEN), Dunkin' Donuts (DNKN) and Darden Restaurants (DRI), an executive from Northeast and Midwest onion-steamed mini-burger chain White Castle told National Public Radio his restaurants may hire only part-time workers in the future to avoid the costs of the new health care insurance mandate. White Castle vice president Jamie Richardson says his company's health care costs will rise by 24% once the law is implemented.
The Affordable Care Act, often referred to as Obamacare, requires businesses to offer health insurance to all full-time employees or face significant financial penalties. Earlier this month, however, the Obama administration announced that implementing the corporate insurance measures would be delayed until 2015.
Unlike its fast-food and casual dining cohorts, however, White Castle refuses to cut current workers' hours, fire them or slash benefits to comply with the new health care laws. White Castle employs roughly 9,600 workers nationwide, about half of whom are full time and already covered under the company's health care plan. "If you're full time at White Castle, you're going to stay full time at White Castle," Richardson told NPR.
Judging by employers' reaction to the new health care rules so far, White Castle's restrained reaction falls well within the majority. According to a March survey from the Minneapolis Federal Reserve, nearly 90% of employers won't shift full-time workers to part time once the new law takes effect.
The International Foundation of Employee Benefit Plans, an organization of human resources professionals, found that more than two-thirds of companies definitely plan to offer health benefits to full-time workers after the ACA is implemented. Just 0.5% said they definitely will discontinue coverage. More than 90% of companies surveyed currently offer health benefits to full-time workers.
Still, White Castle's Richardson notes that the fast-food industry's margins are far tighter than those of other industries. The profit per employee in restaurants is only $750 per year, he says, which makes adding health insurance as a benefit for all employees over 30 hours, as the health care law requires, particularly painful.
It would take some Harold-and-Kumar-size hunger for Crave Case suitcase boxes of White Castle sliders to compensate for the cost of increased coverage.
Defunfd or repeal the Unaffordable Care Act.
The President lied about Obamacare Not being a Tax and the Supreme Court said:Yes it is a Tax. Most Americans don't believe anything coming out of Obamas mouth because he lies so often that if he ever was truthful, we would probably miss it. Instead of Uniting Americans , he will be forever known as the Great Divider. And please don't mention God around him , you might get arrested.
Low wage employees getting reduced hours, already barely able to survive, and getting worse, all thanks to OBAMA.
Change, hope, wtf was he talking about. About time for america to follow in the footsteps of egypt.
Best change we could get right now, is obama and biden out of office. By far the worst president we have ever had in all of history.
Let's see, 60% of all new jobs are created by small business. We have a real unemployment problem in this country. Hey, I know, let's screw over small business even more and make it more difficult for them to survive, let alone thrive. Brilliant!
This is what happens when you vote for a bunch of professional politicians, activists, community organizers and lawyers.
Impeach this muzlim moron & all 535 members of congress & every communist czar before this antichrist does anymore damage to ths country before all hellbreaks loose.
gil 263. they do not care. they do not work. they live on the government tit and have free medical care.why should these free loaders worry about obama care. they will lose nothing.
"When the populace learns that it can vote itself moneys from the treasury, Democracy is finished."
So who's still singing the praises of Obamacare?? Or Obama???
"If you're full time at White Castle, you're going to stay full time at White Castle"
$100 says this will change come 2015.
I will never ever forget Pelosi screaming at the top of her lungs," PASS IT, YOU CAN READ IT LATER!!!!!"! Is it any wonder why we have a Congress in gridlock??????????????? But then again, ask any liberal and they will all agree that we really don't need to follow the law. Who needs a constitution to run a country?
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Equity indices began the day in the red, but wasted no time regaining their flat lines. Small-cap stocks were not as fortunate as the Russell 2000 spent the day in the red.
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