Dunkin' takes shot at modifying Obamacare

The company is lobbying the government to narrow the Affordable Care Act's definition of 'full time,' which would mean fewer employees for it insure.

By Aimee Picchi Feb 20, 2013 1:24PM

File photo of a Dunkin' Donuts Inc. store in Midtown Manhattan (© Ramin Talaie/Getty Images)The question of who counts as a full-time worker is coming under fire from Dunkin' Brands (DNKN), which wants the government to narrow its definition under Obamacare. That's because it wants to avoid paying health insurance for Dunkin' Donuts employees who work as little as 30 hours a week.


Dunkin' Brands is lobbying the government to change the U.S. Affordable Care Act's definition of "full-time" to employees working at least 40 hours a week, instead of the 30 hours currently written into the law, Chief Executive Nigel Travis told the Financial Times


The latest volley from an iconic U.S. business comes as the ACA is set to go into effect next year. The law will require employers with 50 or more full-time employees (30 hours or more) to offer those workers "minimum essential" healthcare insurance. 


Dunkin' Brands, which also owns Baskin-Robbins, operates on a franchise model. The parent company, excluding workers at its company-owned restaurants, employed more than 1,120 people at the end of 2011, according to its annual report.


But the real benefit would likely go to Dunkin's franchisees, who operate more than 10,000 Dunkin' Donuts locations and almost 7,000 Baskin-Robbins restaurants. 


Other big businesses are lashing out at the costs of the plan. Supermarket chain Kroger (KR) told the FT that some companies might decide to pay the government-mandated penalty for failing to insure employees simply because it's cheaper than buying insurance. 


Small-business owners are also reacting. As previously reported by MSN moneyNOW, one Wendy's franchise in Nebraska is cutting back the hours of non-management employees to avoid paying health benefits. The local franchise vice president said his company couldn't afford to pay for health insurance and instead is cutting hours of about 100 Wendy's workers. 


Other businesses are keeping their employee count under 50, the FT notes. 


The average cost to employers of providing insurance for a single worker is $4,664 and $11,329 for a family, the FT notes, citing the Kaiser Family Foundation. The penalty for not insuring employees under Obamacare, meanwhile, is $2,000 per worker. 


"If you look through the economics of the penalty the companies pay versus the cost to provide coverage, the penalty's too low, or the cost of coverage is too high, or the combination is wrong," Kroger Chief Executive David Dillon told the newspaper. 


More on moneyNOW

1465Comments
Feb 20, 2013 3:50PM
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These companies are fools...They will "cut" their work force so low that they will not be able to carry on business as usual.  Once that happens then you lose a LOT more money in the way of revenue then you would by taking care of your workers.  Common sense:  If you are open , you need people there working!
Feb 20, 2013 3:50PM
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It is always boil down to the basic question: where is the money for a great idea.  Obama, having no interest in economy, just don't care the basic question.  He just want to do good.

Feb 20, 2013 3:49PM
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These businesses want to go to 40 hours so they can avoid hiring full time employees to avoid paying for health insurance.  They already are making well enough money to afford healthcare.  Greed.  My advice to them is to cut back on part time workers and hire full time.  For years many unethical greedy companies hired part time and contingent employees when these people want full time.  Do they not realize these people need to spend money filling their tanks getting to work,  feeding their families or making a payment on the home so they can have a place to live.  Maybe  these companies are one of the reasons for the housing failure. People couldn't get full time.

Feb 20, 2013 3:49PM
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If the private health care system is the solution why the hell are we in the situation we are in right now! We are the only modern industrial nation to still have a free market private health care system for good reason! We have no choice with health care and so there is no conventional free market price control! Double digit price increases year after year for decades has left us unable to provide health care for our citizens and this is truley a sad stae of affairs!
Feb 20, 2013 3:48PM
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Even if you have insurance you still have to go to the emergency room if you need to see the doctor right away.
Feb 20, 2013 3:48PM
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First of all, I have NEVER worked in a job that required 40 hours a week, and I have always been full-time. My first company was 35 hrs/wk: 9-5, with one hour unpaid lunch. My last two companies have been 37.5 hr/wk: 9-5 with a 1/2 hour unpaid lunch.

Second, it's obvious that Dunkin Donuts (and Papa Johns, and others of their ilk) don't care about the health of their employees, because they are not currently providing heath insurance. If they did, this wouldn't be an issue. So now they will cut people's hours so they can continue to NOT pay them insurance.

I'd rather see Dunkin Donuts raise the price of coffee by $0.25, or Papa John's raise the price of a pizza by $0.14, and know their employees are taken care of...

Feb 20, 2013 3:47PM
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Oh yeah, all the Obama haters come out of from under the GOP rocks to blast him and the ACA.  I love the teapartiers who shove posters around---"Keep Big Guvment Hands off my Medicare", etc.  What a pack of rocket surgeons.  At over 70 I'm still working full time by choice and I like the ACA future....sure, I am biased as a third generation southern Calif. liberal Democrat.  As an army vet (W. Germany, early 60s) I have had great care at the VA-San Diego. I know how expensive and complicated medical care is vs. yrs. ago when my pop could pay the monthly premiums for Blue Cross comprehensive/catastrophic coverage for himself and mother.  Both were asthmatics.  He once spent a week in the very posh La Jolla Scripps Clinic looking down at a beach in '69 with everything covered--pvt. room, great meals, great care. 

Feb 20, 2013 3:46PM
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Quit your whinning and get on the boat with the rest of us AMERICANS who voted for Obama and Obamacare.  Sorry, yours is a losing cause.  Additionally, no more Dunkins for this household.  Never liked their coffee anyway.   They can go down the road with Red Lobster and any other restaurant chain who fail to recognize their most important asset is their employee! 
Feb 20, 2013 3:46PM
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If this successful franchise cannot  fork over a few dollars to insure its employees,

then I will stop patronizing them.

Feb 20, 2013 3:46PM
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For all of you that are chastising the brain dead voters who put this maniac in office... don't waste your time. They either can't read or they speak Spanish. See you all in the unemployment line.
Feb 20, 2013 3:45PM
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Idiots the companies are doing exactly what the government want them to do.  They don't like to pay taxes.  So they pay penalties instead.  Instead of the money going to the insurance company, its going to the government.
Feb 20, 2013 3:45PM
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When the full effects of Obamacare take place with higher taxes, less care, liberals will blame the Repubs and Bush. It is a sorry state of affairs when this know nothing President ruins our once great country with his stupidity. Have no fear as the dummies in Congress and the media will keep singing the praises of the ACA is great while the rest of us say it is sh!t sandwich.  
Feb 20, 2013 3:45PM
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These companies have alternatives to having to go under the Obama care umbrella. They just choose to screw their employees, putting them on food stamps, section 8 housing, and medicare or medicaid to keep a roof over their head and food on the table. When they no longer have customers because their customer service (such as it is) nose dives even further and they have to go out of business they can't blame anyone but themselves.
Feb 20, 2013 3:44PM
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Raising the min wage will help low income earners buy their own ins or pay the fines, even with cutbacks in hours worked and fewer working.

NOT

Feb 20, 2013 3:43PM
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Why isn't anybody that's crying on these comments asking the right question: Why isn't Dunkin Donuts offering healthcare for their employees?  The owner of Papa Ginos said he would have to raise the cost of his pizzas by a whole 10 cents to be able to offer healthcare to his employees. Wow, that's going to put him out of business!! I say companies that don't offer healthcare to their employees should be boycotted!!
Feb 20, 2013 3:43PM
Feb 20, 2013 3:42PM
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I don't understand the logic of people who are complaining about government subsidies to people for food, housing, bills, and healthcare, but seem to have no problem with companies who are highly profitable but refuse to pay their employees a livable wage and help contribute to their own employees health.  Many will agree that the health care law isn't perfect, but something's got to give.  If your favorite past time is whining about all the stuff some people are getting while others are paying for it, logically, it should occur to you that with the STATUS QUO, someone else is already paying for it. But I know, just as long as it's not you. If you own a business and you cannot pay your employees a livable wage to begin with (much less contribute to their health insurance), you don't have a viable business to support employees. Either do all of the work yourself or close your business. It is not right for you to rely on employees to profit from your business, but then send those employees to the local, state, and federal government for their basic needs like housing, food, and healthcare (you know, the exact f** stuff they wanted to work to gain for themselves to begin with). 
It's VERY SIMPLE. 
Feb 20, 2013 3:42PM
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Of course Obamacare will work great, just like those other government run departments: Immigration, the USPS, and Social Security. And lets not forget the VA. The USSR went bust, and may still beat us.
Feb 20, 2013 3:42PM
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Don't worry nobody 00777. The Government regulation over healthcare will eventually lead to more affordable care do to the burden of regulation. when the gov steps in... profit margins decrease and the medical industry will start to third world out more things to try to keep their pockets fat. Also in the mean time all those penalties should some how help fund more regulation. Ha Ha Every industry has its golden era and the medical industries is about to end. Think about it doctors get to charge to meet you, then they charge to tell you they don't know what is wrong, then they charge to run tests, then they charge for a procedure that carries no finality. What a racket! Time to step on these pricks! If I could say in my line of work (you might die if you don't fix this) it would be quite easy to take advantage of people and overcharge.
Feb 20, 2013 3:42PM
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Thanks to the republicans' who propagandized the hell of of this issue to the point that they were able to get everything the private heath care industry wanted including massive profits... No single payer system with cost controls to stop the ridiculous yearly increases we have seen here for decades. If younger workers  were able to enter the medicare system the rates would be much lower for everyone!
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