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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Jan 10, 2013 11:05AM
it's  sad that too many so call business owner only care about the immediate gains for yourselves. when you start a business you better do your homework and have readily capital available to fund your venture . if you need to be the janitor , counterperson, grassmower in the beginning so be it, thats what it will take to start. Once the business gain momentum you'll need help but dont expect to enslave your workers by just giving them min.wage and part time hours because they will not be there for you to help build your future, you need to give them something in return because without loyal vested workers your small business won't succeed. you'll always be having turn over and spinning your wheels , people will talk about you and sooner or later you'll be just getting by and blaming ,pointing fingers at everyone else for your lack of wealth. People have forgotten how to share .
Jan 10, 2013 11:04AM
Best way to have handled this wasn't a "full time" basis, but a "proportional" basis. I.e., if you work 10% of the hours of a full time employee, the employer contributes 10% towards your health care premium costs. Shifting hours and definitions of full-time would make no difference then.
These contributions would go to a common collection, like unemployment, and used to buy essential coverage for everyone. (Yes, I think single payer is really the way - but start small).
Employers would be free to supply supplemental insurance policies above this for "full-time" employees, if they so wished. (Note that the premiums for this supplemental policy should decrease significantly because the common essential would be primary.)
Jan 10, 2013 11:02AM
What have the citizens of Mass. to say about Romneycare, private citizens and business alike seem well satisfied by it. So you detractors are all about prophesizing another 2012 doomsday scenario for Obamacare. Businesses have never looked out for their employees, That is why they had unions forced on them. Prior to 1935 you worked until you dropped dead, they COULDN'T afford pensions. Social Security forced the the companies to offer it to get better workers. And Social Security wasn't started by businesses. Medical coverage was said to be UNAFFORDABLE by businesses until Medicare and Medicade forced them to provide for it. Businesses fought tooth and nail to prevent every bit of help to the workers, from Social Security to every other form of worker benefit and always with the same arguement. THEY CAN'T Afford it. Well its time they dipped into that 32 trillion dollar nest egg and gave some of it back to the workers who made it possible.         
Jan 10, 2013 10:58AM

One thing, you schmucks, Onefungi, need to realize that if the independent owners didn't live in a lifestyle they cannot afford, then their employees could have health care.  I own three businesses and I didn't have to have the government tell methat my employees needed healthcare.  I've always had it by joing a co-op group where we get the coverage at a great rate as if we're a large company.


There are ways to be fair and decent to people without being a total **** because you wnat to live like a movie star.

Jan 10, 2013 10:58AM

wow...there's going to be an awful lot of pissed off illegal immigrants that get their hours cut AND no freebee healthcare!



Jan 10, 2013 10:52AM
I am a small business owner and cannot afford insurance for my employees...BUT I DO IT because it is the RIGHT THING TO DO.  It's my biggest expense, so what...I am contributing to the livelihood of my staff and protecting their health and financial stability.
Jan 10, 2013 10:49AM
Ninety five percent of Wendy's employess do not enjoy medical coverage by Wendy's already. Wendy's follows the same hiring practices as all fast food franchises. Employees are hired and rarely work a full week longer than two or three weeks. They are then put on temporary status two or three days of work per week. Unless they show some promise to becoming managerial material, their work days are futher reduced until they stop coming. Any one of these franchises may have two or three full time managers and as many as sixty to a hundred part time employees. Only a full time manager qialifies for the employee package of fringe benefits such as a retirement , medical and vacation packages. This policy guarantees that they pay low unemployment insurance. You don't qualify for unemployment benefits unless you have sufficient hours per week and or in some cases a minimum amount earned over a specific interval of time. Only full time employees qualify for medical coverage. Medical coverage becoming madatory means that more people will be covered which means that overall rates should drop unless the insurance companies are rigging the statistics        
Jan 10, 2013 10:48AM
The real fact of the matter is can we afford as a nation to withstand a tax increase for medicaid? Let's face it America the way we have lived before is over. I pose this question,"Who picks up the tab for all of those who aren't able to have health insurance provided for them by an employer?" We have to do what is right as humans and put the politics aside. i have a small business and also make it possible that my employees are able to have health insurance. I researched and found a plan that worked for all involved.
Jan 10, 2013 10:46AM

Just keep listening to the rich, they will lead you to the desert oasis.  Darn, they have to cut people's hours so they can make $10 million instead of $9 million.  Now that is the new american way.  If we took the top 1000 CEOs and cut their pay by $1million each we could pay for health care for every worker couldnt we.  That would be an addional $1billion to pay for health care.  Wow but you wacko righties keep fighting cause that $1million dollar cut to the 1000 top CEOs would mean they only would make say $19 million vs. $20 million a year.  bunch of idiots.  Keep on working for nothing and keep giving CEOs double digit raises for cutting your living standards.  Yep in the last 20 years managers have gotten triple to quadrouple digit raises while your standard of living has diminished.  right wing wacko thinking has gotten us to where we are NOT OBAMA.  How many Bush's are needed to hide the truth?  *just 2- George H and George W...........

Jan 10, 2013 10:40AM
If John Rigos "absolutly supports" Obummer care then he can just shut the hell up!
Jan 10, 2013 10:36AM

Owners stop being so greedy and let your workers have healthcare. 

Jan 10, 2013 10:32AM
My wife's company just laid off a slew of people because of this and their a multi-million dollar company.
Jan 10, 2013 10:27AM

just one way Obumer bringing down the country,you haven't seen anything yet''


Jan 10, 2013 10:25AM
I have two restaurants that employ 72 people most of which hit the 30 hour mark. The razor thin margins in the restaurant business means I have to do something to combat Obamacare. Implementing it would simply put me out of business. Business owners aren't being greedy, we are just trying to save as many jobs as possible. If we start closing our business' because of the burden of Obamacare everyone loses. 2014 is going to be a very sad year for us all.
Jan 10, 2013 10:19AM
...like "papa john" said as he donated tons of money to "elevators for my cars" romney, he'd have to add 14 whole cents to the cost of each pizza.  Meanwhile, he knocks $2-3 bucks off a pizza every time the hometown NFL team wins. Reference Jack 'n the Box ad with people (republican hypicrites I suspect) on a sliding board to the devil. I hope all of the affected employees voted republican or, better yet, low wage "conservatives".  Ha ha ha ha!
Jan 10, 2013 10:17AM
SCREW all those WENDY'S working poor, let em go to the E. R. when they get sick and let the rest of us get TRIPLE charged for their health care. Why should Wendys have to pay a couple cents on a burger to provide basic health coverage for these free loaders??? That freakin Obama is ruining the country!!!!
Jan 10, 2013 10:17AM

People don't work and guess what....they get a free pass. People don't work and guess what....they pretty much get free health care. People don't work and guess what.... they get their groceries and utilities paid for. I work 70 hours a week and have to pay higher taxes because I want to make more money to support my family and give them things they deserve....guess what..... I get to pay for those who don't work. I have health insurance and hate going to the doctor because it still costs me a fortune. I'm glad that I can work to pay bills for lazy people who do not care to work. This country is ridiculous. I am proud to be an American, but I am not proud to be any part of our political system.

Jan 10, 2013 10:11AM
These companies have been using the American people for years to supplement their employees healthcare.  It's called ER visits....who do you think pays for healthcare if their employees' don't?  WE, THE PUBLIC,  DO! These companies do not need to pay for all their employees healthcare - they just need to offer it to them and offer a specific amount for their insurance and the employee can decide if they want to make up the difference.  This isn't that hard.  If the CEO's would educate themselves instead of making rash statements, they would see the benefit to them to do this for their employees. Think long term here...
Jan 10, 2013 10:10AM
This is only the beginning for Obama and His Obamacare, Now His fight is with the 2nd. amendment....which was placed there by those who knew that someday someone like Him would appear....this Man wants tobe "KING" not just president.
Jan 10, 2013 10:05AM
YOU   asked for it stupid,  now  suck -up to dems & enjoy.
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