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 7:53PM
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BooHoo! Raise the price of your stupid pizza or hamburgers! Otherwise scew all employees work everybody uder 30 hours and let em all buy their own healthcare! Good F##kn luck Idiots!
Jan 9, 2013 7:53PM
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What's the oath every rep. senator, and president take? Have they kept it? Have they defended the constitution of the United States of America from all enemies foreign and domestic?  They have become the enemy. How many years has it been since they passed a budget? The economy, gun control, wars, special interests, ENOUGH ALREADY!! Get these people out of office!
Jan 9, 2013 7:53PM
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Wendy's how nice of you. Are you going to pass the savings on to us in the form of french fries?
Jan 9, 2013 7:52PM
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Instead of the ten dollar pizza make it the eleven dollar pizza.
Jan 9, 2013 7:52PM
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They just lost my business.  It's just stupid.  They  can afford to make a little less to provide insurance for their employees.  So basically they are like Walmart.  They want the public to cover the cost of their employees healthcare because they are too damned cheap.
Jan 9, 2013 7:52PM
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****. Reduce your employees to 49 and that fixes the problem.

 

Also I will gurantee that not all of his fifty empolyees are full-time or work more than 30 hours per week.

Hate Obama alln you want. not only did Democratc elect him , but you GOP ****s could not even muster one legitimate candidate that could defeat a vulnerable president in a weak economy. You want to blame omebody for Obama. Look in the mirtror..

 

How manf fast food places actually provide insurance?

Jan 9, 2013 7:51PM
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Hawaii has required employers to provide healthcare for employees who work more  than 20 hours for years...Everyone has two jobs! Most people work 19 hours at one job, then go work 19 hours at their other job. THANKS A LOT OBAMA! Free isn't free.
Jan 9, 2013 7:50PM
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To all you Obama haters you are not the same people how go to Walmart and buy made in china are you??? Some needs to look out for the poor, because the Waltons, Republicans don't, and Papa John could not afford a new jet if he had to pay health care. The guy has 600 million and cant even help his employees out, and it Obamas fault right??? Go stuff your pie holes with cheap burgers after shopping at Walmart you hill billies!!!!
Jan 9, 2013 7:50PM
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Wendy's has terrible customer service.  They never get our order right and it never is a complicated order either.  I would think cutting down staff hours and working with smaller teams or employees isn't going to help them in the long run as they lose business because of bad service.

Jan 9, 2013 7:48PM
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This was expected no suprises here.  This is a simple mathmatical formula.  Most successful business owners I know didn't get there by giving away all the profit.  When the governement changes the rules of the game the stronger players adjust and the weaker players suffer.  If Obamacare impacts companies with 50+ employees who work more than 36 hours a week, well then any smart business owner (strong player) is going to make sure that penalty doesn't apply to them.  Thier employees who most likely have limited options, means, and education will find thier hours reduced or employment terminated (weaker player).  Its ironic that the very laws the weaker players vote for in the end only hurt them more.  I don't know a single business owner that wanted ObamaCare.  I'm sure we will discover there will be a lot of employees that when faced with thier new circumstances will wish they hadn't voted for it either. 
Jan 9, 2013 7:48PM
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I think what you are all missing is that fact that the people who are cutting hours to eliminate the cost of providing health care, are only doing it so they don't have to pay the penalty ( 2,000.00 per employee tax) they will have to pay for not offering it.  They have options, they don't have to offer a GM type program, they just have to offer something.  The employees can choose if they want the employer plan or the government sponsored option.  If the employees opt for the government sponsored program the employer is no worse off than he is today. There is not cost to him. 

 

 I am so sick of everyone commenting on what they think they know.  Go out and read it, take a seminar, do something except complain about something you only think you know because you listen to the politicians and health care industry and business owners rhetoric.  They have one reason for keeping mainstream America upset over "Obamacare".  They don't want to pay for because their personal earnings will be impacted. 

 

I challenge each of you who are buying into the Obamacare debate to get all the facts before you bash it.  I personally and tired of paying out of my pocket, for bad decisions people make who dont want coverage and wont pay for it, but will surely show up on the ER doorstep when they are sick.  Everyone needs to be responsible for themselves.  I say sure, give them an option, take the employer coverage, take the government program, or pay a tax at end of year. 

 

And for you folks who are next going to say, hang on, what about the low income families that can't afford it.  They are covered.  There is a household income level that you have to cross before you would be penalized for not taking the coverage.  

Jan 9, 2013 7:48PM
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Looks like we will be doing our eating at somewhere else that will treat their employees right. I bet the owners have their healthcare!  Greedy!

Jan 9, 2013 7:48PM
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There is a global effort to bring down all the independent financial systems and consolidate them into one system. Obama is only doing what he can on his side of the atlantic. I cannot believe the brain trust in Washington is that naive that they do not see the consequences of their actions on the economy. They truely believe they will bring about a more fair and just society with them in control of course. Unfortunately they will succeed if you believe in the bible. Their rein will cause everyone to suffer.   
Jan 9, 2013 7:47PM
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America wanted this. The majority of the people voted for the government to pass this law. Now we get what we voted for.
Jan 9, 2013 7:46PM
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Sadly, US has become a country where it is more advantageous to live off the state than work. Something's gotta give. 

 

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Lots of good comments.  If everyone who made them had of voted the libs would not still be giving away the money earned by workers.
Jan 9, 2013 7:46PM
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I think this is only the beginning.  This trend will continue.  People will have to have more than one job in order to make ends meet, and then they will have to figure out how to pay for their own healthcare coverage.  When the workforce gets to the point that they are working two jobs and still cannot afford to purchase insurance for themselves or for their families, where will that leave us?  I am afraid we will be right back to where we are with millions un-insured because they simply cannot afford it, plus we will have even more national debt.  Maybe I'm wrong, but it seems inevitable. 
Jan 9, 2013 7:45PM
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We are americans, we are strong, and our will will not be broken.Its sad to see what our countrys become.Instead of being a strong,  hard working nation that if you put the effort in, you could relize your dream. However we've become a nation who rewards failure and lazyness.

Jan 9, 2013 7:45PM
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This is not anything new.  Major companies have been doing this for quite some time. well before President Obama was elected to office  a company I worked for quit hiring any full time workers and demoted some of their full time workers to part time just so they would not have to provide health coverage.  The only people that received health coverage were management  level, and were paid by a salary rather than hourly employees.  So blaming ACA for this is wrong.  It has been going on for years.
Jan 9, 2013 7:45PM
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These guys need to take their bellyaching and their friggin' franchises to Russia if they don't want to do right by their fellow Americans.  Gerard Depardiu (sp) could keep several of them in business...
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