Obamacare has more companies opting for part-timers

They're making this move to avoid paying for full-time workers' health insurance under the Affordable Care Act.

By Bruce Kennedy Apr 1, 2013 8:33AM

Insurance Money © Comstock Images, JupiterimagesAnother national company says it's reducing the number of hours many of its employees will work, making them part-time staff, thanks to Obamacare. Scheduled to go into effect next year, the Affordable Care Act (ACA) is expected raise health care insurance prices, according to recent studies. As a result, a growing number of American businesses are opting to switch workers to part-time status.

AAA Parking, the latest company to react this way to Obamacare, manages more than 200 properties across the U.S. and employs over 1,500 people. AAA recently announced it will move about half of its 500 full-time, hourly employees to part-time status next month in response to the Affordable Care Act.

According to the Atlanta Business Chronicle, a company memo said executives had "spent extensive time evaluating the impact of this mandate, and the financial impact for AAA Parking is dramatic."

The company told the Chronicle that upholding the new laws would require it to make "substantial changes in our hourly staffing models, or suffer an enormous and unsustainable annual net loss," costing AAA Parking over $1.2 million annually in cut employee hours.

Under the ACA, companies with at least 50 full-time employees will have make "qualified" health insurance coverage available to those workers and their dependents. Close to half of U.S. retailers, restaurants and hotels will be touched by this part of the law. And Armand Balsano, managing director at the Atlanta offices of business advisory firm Navigant Consulting, said that's where the unexpected and undesired effects of ACA will kick in.

In particular, Balsano told the Chronicle, companies with low-wage workers are employing more part-timers over full-time employees to avoid potential ACA penalties.

And having a majority of your employees as part-timers opens up another can of worms. "There are a lot of businesses that don’t work as well without full-time people," said Tony Holmes, a partner at Mercer Health & Benefits. "You might think you can save money by avoiding the health costs or penalty, but at the end of the day, trying to get stuff done with part-time people may not lead to business growth or success."

The New York Times Economix blog notes that, compared to the official start of the recession in December 2007, currently 5.8 million fewer Americans are working full-time, but the number working part-time has increased by 2.8 million.

Most of these changes are apparently attributable to the changing economy and not directly to companies reacting to the ACA. But as The Times notes, while part-time workers are still a minority in the U.S. work force, "their share is growing."

More on moneyNOW

Apr 1, 2013 11:08AM
is there anyone left who thinks the healthcare bill was a good idea??  I did not think so.  too many taxes, mandates and regulations to even come close to working for the people
Apr 1, 2013 10:02AM
What this article fails to mention is that if you are connected to a politician and "donate" or more aptly bribe or more even more aptly referred to as "extortion" you can secure a waiver.  The back door effect of this law will be to assure politicians will have a steady revenue stream from here to eternity.  Always remember politicians do what benefits them, ALWAYS.
Apr 1, 2013 11:10AM

I wonder how many of the workers getting demoted to part time staff at this company and the countless others in the media due to Obamamcare would vote for him again.  Does anyone else see the irony here?

Apr 1, 2013 11:27AM

Most of these PT workers will still make too much money to get Obama Care for free, so they will have to pay for this expensive care out of their own pocket from a smaller paycheck or get fined by the IRS.


Liberals never think of the consequences of their actions and react based on emotions to any crazy lie they are told. Sheeple never will learn. This is too funny as they got exactly what they voted for, so let the whining begin. 

Apr 1, 2013 11:40AM
What I want to know is why MSNBC did not cover this before this healthcare monstrosity was signed into law. Any educated, informed person knew this would happen along with a dramatic increase in everyone's insurance premiums. Woops, dumb question huh?
Apr 1, 2013 10:33AM
Here is an example of the law of unintended consequences.   I guess everyone will need to have two jobs.
 We have held our employment the same for 3 years.  When we are busy, everyone works overtime.  Currently it is averaging 5%, which could be 5% more employees, but it won't.  If business picks up we will take the money earned over the last 4 years and invest it in automation, deferring the need for more employees further.   Also looking at outsourcing some work to other companies and overseas or in Mexico.  Thanks for a great law...NOT!
Apr 1, 2013 11:21AM
Now who could have foreseen this outcome?!   Oh yeah.....I DID!!!!     Progressives are sooooo stupid!
Apr 1, 2013 10:42AM
Maybe I am too cynical, but I believe this to be deliberate BO policy: As people are forced into part time work, companies will have to put on additional part time workers--Part Time workers are not counted in the unemployment number (U3), widely reported by Pravda.
Apr 1, 2013 11:14AM
IMHO, this is only the beginning of a fundamental employment change that will last for generations.  Not only will we see more part-timers, we'll also see more independent contractors.  We'll also see tax attorneys get plenty of work as "creative business planning and expansion" consultants - instead of starting a small business and growing it into something big, the idea will be to start a small business and grow it just large enough so that you can start another small business.  At some point, it will be better to own 3 HVAC companies, each with 40 employees, rather than 1 large HVAC company with 110 employees - the cost of the 10 extra employees and associated separate business costs will be cheaper and safer in the long run.  The same goes for just about every small business imaginable.  No matter what the IRS or gov regulators do, businesses and entrepreneurs will always find a way to work around it.

There was an article near the end of last week that talked about how there are less publicly-traded companies now than there used to be.  This is probably a long term trend, too.  When you look at the crap you gotta put up with from the pols and the SEC, plus all the disclosure regs and filings, it just makes more sense in many cases to remain a privately-held entity.

Apr 1, 2013 11:35AM
Mr. Obama,  Utopia is a nice idea, but it is only fiction.  It cannot be achieved  by the human race without financial collapse. 
Apr 1, 2013 11:29AM
Mr. Obama has no practical business experience and the outcome of more part time workers as a result of the AHA is a clear confirmation. Business will always find a way to manage a cost. It generally gets passed on to the consumer, however in this case its getting passed on to employee. 

I'm sure many of these new part timers were his targeted audience, that needed help from the wealthy paying just a little bit more. Guess they are paying a lot more! 
Apr 1, 2013 11:35AM
The working class will/are suffering. I hope the bottom of the barrel ghetto people are happy.
Apr 1, 2013 11:47AM
You can call them Progressives but all they really are is Dumbocrats!
All of the people that voted for Obummer are now going to suffer the consequences.  The funny part (if there is anything funny about this) is that those who voted for him are going to be the first ones either let go or moved to part time.

Just saying....
Apr 1, 2013 11:45AM
IF America survives another four years remember to vote for anyone BUT a Demorat next time. Unless of course are a socialist or communist.   How about all you Osama Obama lovers start looking at all the Democrat big business owners for a change.  You silly people really think that every CEO is a Republican?
Apr 1, 2013 11:51AM

NO surprise here.  Duh, who  would re-elect those liberal socialist fools.  The Dumb electing the Dumber.   Shameful - haven't been able to fly my flag going on 5 years now.  Very sad for our servicemen and women who are laying their lives on the line for a country that is voluntarily giving away its rights and freedoms on a daily basis. 


Any time the laws create an artificial threshold, the people will find a way to avoid it.  Cutting your workforce back to part-time is a no brainer and an obvious "intended" reaction created by this law.  You'd have to be blind not to see this coming.


Companies are no different than people - they try to save money any way they can - duh.  In fact, I'll let you in on a little secret.  Companies are actually run by "people" who are paid to help make the company successul (profitable).  But, who would want to work for a profitable company anyway.  Much better to work for those bankrupt companies.

Apr 1, 2013 10:46AM
the revolution has commenced. free enterprise is voting with its feet. when you are denied a win at the ballot box, vote with your feet at the first opportunity. vote with your feet folks. starve the beast.
Apr 1, 2013 11:36AM
So what can the US govt. manage successfully? Anybody? Yet the mindless in DC continue to try and fail? Politicians are as politicians do. All are in it for themselves....end of story. Just my opinion.
Apr 1, 2013 11:19AM
The more we tweak, the more we screw it up.
Apr 1, 2013 12:10PM
Thanks Obama!! Now we'll need more food stamps to subsidize people who won't be able to afford groceries because their hours got cut. Good job pres.....
Apr 1, 2013 11:55AM

Well, I hope all of you Liberal idiots are satisfied with yourselves by supporting Obama & his Obama care.


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