Wendy’s franchise cuts hours to avoid Obamacare
The action is the latest in a series of challenges against next year's implementation of the Affordable Care Act.
The small-business backlash against Obamacare continues. A Wendy’s fast-food franchise in Nebraska is cutting the hours of non-management employees so its owners won't be required to pay health benefits.
The local franchise vice president in Omaha tells WOWT-TV the cuts are coming in several weeks’ time because he cannot afford to pay health insurance for all his employees.
Starting next year the U.S. Affordable Care Act, also known as Obamacare, will require employers with 50 or more full-time employees to offer full-time workers "minimum essential" healthcare coverage. The Act defines a full-time employee as someone who works at least 30 hours a week.
As a result, about 100 Wendy’s workers in Omaha have been told their hours are being cut.
"It has a huge effect on me and pretty much everybody that I work with," T.J. Growbeck, who currently works 36 to 37 hours a week at the restaurant, told WOWT. "I'm hoping that I can get some sort of promotion because then I would get my hours, but everybody is shooting for that because of the hours being cut."
Wendy's spokesman Denny Lynch told the Huffington Post the decision was being made at the franchise level.
"Our franchisees are independent businesspeople, and they make the decisions regarding their restaurant teams," he said. "As small-business employers, our franchisees are facing rising food and operating costs and many new government regulations."
While Wendy’s says the hours-cutting action by its Omaha franchise is not "a company decision," several major restaurant chains have been very vocal in their criticism of Obamacare.
A case in point: Papa John's (PZZA) CEO John Schnatter said the Affordable Care Act would cost his company up to $8 million a year, which would force him to increase product costs and cut workers’ hours.
Other restaurant franchises, meanwhile, are also looking at options ahead of Obamacare. John Rigos, owner of a Five Guys franchise in New York City, told CBS News the new regulations will affect hiring policies at his restaurants.
"It'll probably have to reduce the staff to some degree," he said, "and again, focus on building [a] smaller stronger team rather than being as aggressive in opening up new stores and creating new jobs."
Rigos said while he "absolutely" supports Obamacare, he still finds it challenging.
"There's 25,000 restaurants within the New York City market we're competing against," he notes, "so it's not like we have surplus profits that we could just earmark a portion of them to go toward these types of initiatives."
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Hours reduction has been a common practice for years. It's all about sales results, now we use health care act to fuel the fire instead of offering infromation to help improve life in the United States.
Wendy's is a large company and they as well as other big companies should leverage their corporate size to get affordable health coverage for their employees and make it part of their benefit package to their employees. The employees should be required to match the employer contribution towards this cost.
There should also be reasonable deductibles and co-pays in place to limit going to the doctor or hospital for non-essential visits.
I think everyone should have health care but the cost has to be borne by everyone, not just the small business owner. Looking at the malpractice industry and costs to Dr. of doing business can't be ignored as it has been to date.
LOL at all you people who think a job HAS to provide HC to its employees. Where did you get this non-sense? Oh that is right from the Community Activist who has never run a business in his life and makes a living off attacking business by pandering to the "employees" who feel it is ok to take things from other people. I guess you people have never owned a business or you just do not give a f^&ck and want to take things from other people which is what most of you scum bags are.
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