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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1973Comments
Jan 9, 2013 3:36PM
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Hey Pappa John. Maybe you and Peyton should not give away 2 million pizzas. There, that keeps more than enough $$$$ in your pockets to cover the additional costs of taking care of your loyal employees' health care costs.
Jan 9, 2013 3:36PM
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Don't blame me I voted for Romney. Cry in your own beer.
Jan 9, 2013 3:34PM
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wow more than 50 people and you dont want to pay health care....how does trickle down work again?  can you say GOP is still out of touch....cya in 2014
Jan 9, 2013 3:32PM
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The founder of Papa John's, yes the one you see on TV, makes 1.38 million per year as of 2011. Papa Johns as a company made nearly 56 million after all expenses. I think they could take an 8 million hit so the taxpayer doesn't have to pay for their  workers medical expenses thru medicaid and emergency room visits with no insurance.
Jan 9, 2013 3:31PM
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These employers are raking in profits and sharing very little with the people who made the profits in the first place.  Wendy's owners are lining their pockets while depriving their employees basic benefits.

 

Guess where I will no longer be stopping for lunch. Running a business and robbing your employees the basic dignity of a living wage and benefits should be a crime.  Here is my wish:  that these fat cat owners end up on unemployment!

Jan 9, 2013 3:31PM
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Ok, I'm a Republican. To fix out of control healthcare costs, give people an incentive to take care of themselves. Get the flu, sucks. Get out a blanket, Vitamin C, Zinc, and a few good movies. How about health insurance that advocates gym memberships? Until you kill the Cheetoes and Diet Coke, we will still be fat and over medicated.------------------------------------------------------------------------------------

 

 

The Republican fix, LOL.

Jan 9, 2013 3:30PM
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I wonder how many of these employees voted for Obama?  Like I "tried to" reason with my daughter's boyfriend.....ask your small business owner who he is voting for because you don't want to vote for someone who ultimately will have a negative impact on your employment (i.e., getting laid-off).  So much for good reasoning skills. 

Jan 9, 2013 3:29PM
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The clown in chief is destroying this great land
Jan 9, 2013 3:29PM
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These companies don't pay their employees very much.  WalMart's prices stay fairly low and they provide health insurance.
     Again - Enough about the ObamaCare issue.  Romney's healthcare in Massachusetts wasn't any better.  Plus, Romney's plan was subsidized 62% by the Federal government and had no benefits for those with existing health conditions.
    In our state, Blue/Cross Blue/Shield has gone up 24% in one year.  You think Wendy's has problems covering for ObamaCare?  Think again - think for yourself - quit letting Bill Cunningham and Michael Savage be your only source of political information.

Jan 9, 2013 3:28PM
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That is it for me on Wendy's. I refuse to buy anything that place sells. Wendy's raised their prices, food didn't get any better, their places are still dirty and their workers don't give a dam.
Jan 9, 2013 3:25PM
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The only employers that will be effected at all are the ones that were not doing the right thing in the first place.  So your busted.  Go out of business and go work for someone smarter who is able to do the right thing.  We won't miss you at all.  Also, Wendy's and Papa Johns are contributing to the healthcare crisis with their products anyways.  When you are gone, some brilliant person will come along to provide quick and healthy food and also provide healthcare to their employees.
Jan 9, 2013 3:20PM
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Waaaah

 

So the rich brat owners won't be able to buy their girlfriends and wives more diamonds

 

They should move their companies to Mexico or the Mormon planet of Kolob 

Jan 9, 2013 3:19PM
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These companies need to suck it up and give their employees benefits.  These CEO's are millionaires and billionaires but have no compassion for their employees.  Shame on them.
Jan 9, 2013 3:17PM
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Massachusetts has had the same basic "obamacare" law in place for years thanks to Romney. And yes we are still here, employed, and staying profitable.  And no,  the sky hasn't fallen yet.
Jan 9, 2013 3:16PM
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should have seen this comung, but I have a legit question I havent herd the answer to yet. they just hav eot offer insurance correct?? there is no minimum percentage that the employer has to pay correct??
Jan 9, 2013 3:16PM
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These multi million dollar companies are worried they are going to lose less than a half a percent of there profit. The Companies are concerned about there CEO's getting there bonus, than the health of there employees. This is why the Country needs Obama care. The rich keeps getting richer.......
Jan 9, 2013 3:15PM
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Maybe the morons that voted for Obama will relise now how bad Obamacare is and what a disaster it is going to cause.

Jan 9, 2013 3:15PM
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I like an occational burger and fries once and a while. I have always thought Wendy's had a little better quality and choice above McDonalds or Buger King, I will NEVER buy another Wendy's product, INSTEAD of a big, mutli national companym, 3rd largest behind McDonalds' and Burger King, profitable and successful, AND a sponsor of adoption under its late owner Dave, IT WOULD RATHER DOWN PAY ITS EMPLOYEES rather than FIGURE OUT HOW TO GET THEM HEALTH CARE. IF they don't ahve coverage, where do they go? To the free (other tax payers pay for) health coverage. This is NOT a small, mom and pop company. This is a huge, successful, profitable international company, Mitt Romney and his billions located in a bank in the Cayman  islands, would be proud. No more Wendy's for me. EVEN IF the others are the same. Becasue IF everything is the same AND I still want to spend my money, I'll give it to someone else.
Jan 9, 2013 3:14PM
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If you think these small business owners are suffering I suggest you look at where and how they live.

Jan 9, 2013 3:14PM
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Funny I didn't hear any plan from the Republicans on how to fix the out of control healthcare cost.

 

Oh that's right they've become the piss and moan party.

 

 

 

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