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.

By Bruce Kennedy Jan 9, 2013 10:13AM

Doctor sitting in office with patient talking and smiling -- Paul Bradbury, OJO Images, Getty ImagesThe 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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1991Comments
Jan 9, 2013 6:36PM
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Because three years was enough time to have a birth certificate forged, I believed then and still believe Obama is a radical  muslim not born in this country and he is doing exactly what he was put into office to do--- destroy US economy.  He is doing a wonderful job-- too bad he is not working for the USA.
Jan 9, 2013 6:36PM
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OMG OMG. What are we going to do if the fast food industry fails?  (That is sarcasm for thos of you who  did not get it.)

Jan 9, 2013 6:36PM
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Wendy's don't have money to pay for employees medical care? I don't think so,They Charge more for a simple hamburger than Panda chinese.food.!! 
Jan 9, 2013 6:36PM
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Simple backlash...boycott the place.....
Jan 9, 2013 6:35PM
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Guess I won't be eating at Wendy's anymore
Jan 9, 2013 6:35PM
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I don't eat burgers very often, but when I do, I'll go to In & Out Burger where they treat there employee's with dignity and respect.

Proverbs 24;16 For though the righteous man falls seven times, he rises again, but the wicked are brought down by calamity

Jan 9, 2013 6:34PM
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i love the fact that all you uneducated hippies who voted for Obama are now getting your hours cut and taxes raised, you deserve every bit of it. Dont vote for people becuase of the color of there skin and how cool they look playing basketball.

 

Jan 9, 2013 6:34PM
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You guys are Idiots. I dont mind paying the extra $$$$ for my employees hey are essential to my businesses and so are theyre families. Those companies that are cutting hours are jus contributing to the underlying issues and ha Unemploment.... Its people and employers like this that are killing america not the system!!!! Stop being Greedy and appreciate the empolyees and people that you have along with the customer base and everything will be fine...
Jan 9, 2013 6:33PM
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The MAN never had a job in his life.  What did you expect?  Wait and see how many hourly earners take a hit.  Small businesses in particular will have no choice but to cut back to 49 employees, or cut hours.  If you voted for him, you got what you "wished for". 
Jan 9, 2013 6:32PM
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Then john rigos is a complete moron. He has to destroy peoples' lives to sidestep obamacare and "absolutely" supports it? F%#^ him.
Jan 9, 2013 6:32PM
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So, if I understand correctly, the "Affordable Care Act", instead of getting employees the intended health care coverage, will mostly have the effect of costing a lot of those employees a big chunk of their paychecks.  But I see this as great news.  Since these employees will be seeing their hours cut, there should be a LOT of part-time, minimum-wage jobs opening up, right?  WOW, Obamacare is really going to make a HUGE impact in the jobless rate!  At least many of the out-of-work, highly trained and educated people drawing unemployment benefits will no longer have to be without work.  Many can now get a job flipping burgers, just like many of us did in college!!!  SWEET DEAL OBAMACARE!!!  GO OBAMACARE!!!
Jan 9, 2013 6:32PM
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I employ people also and will give my employees a maximum of 24 hours now per week.
Jan 9, 2013 6:31PM
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And oblamo said this would improve America and lower healthcare cost....?

oblamo LIED...!

Jan 9, 2013 6:29PM
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It is so sad to read the vast number of comments. People making minimum wage can't afford health care--where is our humanity?  So I pay a $.25 more for something--If someone can get health care I'm glad to do it.  Papa John's generous owner from his mansion said it would cost $.15 more per pizza.
Come on people! Quit being so unwilling to be part of raising up all of us.


Jan 9, 2013 6:29PM
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Its only going to go downhill from here with stories like this. Thats the thanks we get for voting this dimwit into office again.

Jan 9, 2013 6:27PM
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For all of the bleeding hearts who say these business owners are heartless because "I would pay 10 cents for pizza if that meant his employees have health care" here's a dose of reality for you: just because someone has mandated health insurance does NOT mean they have health CARE. They have a card in their pocket is all. Where are all of the providers going to come from? Ever been to a "free" clinic? How about waiting 22 hours for care? Oh, sorry, you died on the floor waiting for a doctor. 
Jan 9, 2013 6:27PM
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Dear ding bats.What do you want Romneyhood??
Jan 9, 2013 6:27PM
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So you people don't want health insurance provided by your employer???  Your not disgusted that they would rather cut your hours than help you get healthcare???

The right wing assault on education has really paid off for them.

I wont even mention the irony that these are fast food places......


Jan 9, 2013 6:26PM
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The cheap managers can rest assured it will be a cold day in h... before I ever eat in Wendy's again! I will bet that the owners have healthcare insurance and who do they think earns the money to pay their premiums? The hourly employes! Their employees are revenue centers and the manager/owners are cost centers! This is not the only way they mistreat their employees either!
Jan 9, 2013 6:25PM
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I lived in Croatia for three months early last year, and found the most interesting attitude among the people there.  You see, no one pays for their own, personal health insurance or care. Instead, the entire health care system is nationalized and people pay a 25% VAT (that's like a sales tax). If you need to see a doctor, you make an appointment, pay a reasonable co-pay (it varies, but if you need the ER because you broke your leg, the copay is not nuts like it is here), and get seen just as quickly as here in the states (yes, that can mean a 3-6 week wait, but i challenge you to make an appointment with your own primary care provider sooner here). And you know what? No one gripes about it, and doctors still make decent money.  Maybe the solution is to permanently separate health insurance and employment, maybe it is even, GASP, socialized health care.  After all, does a 6 year old deserve to be denied health care because her parents earn minimum wage? how about a 16 year old? a 23 year old grad student?

Think about it.

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