Employers around the country, from fast-food franchises to colleges...will be cutting workers’ hours below 30 a week because they can’t afford to offer the health insurance mandated by the Affordable Care Act, also known as Obamacare.No real surprise here, regular readers of this site know we've been discussing this since first drafts of the bill were released for public consumption.
“To tell somebody that you’ve got to decrease their hours because of a law passed in Washington is very frustrating to me,” said Loren Goodridge, who owns 21 Subway franchises, including a restaurant in Kennebunk. “I know the impact I’m having on some of my employees.”
Goodridge said he’s cutting the hours of 50 workers to no more than 29 a week so he won’t trigger the provision in the new health care law that requires employers to offer coverage to employees who work 30 hours or more per week. The provision takes effect in 16 months.There have been wide spread reports cutbacks in workers hours which seem to match the last few monthly Labor Dept. unemployment reports which reflect a big uptick in part time employment. The White House of course says the reports of hourly cuts are anecdotal
Luke Perfect, who has worked at Goodridge’s Kennebunk Subway for more than a decade, said it was “horrible” to learn he was among the employees whose hours would be limited, and that it would be a financial hardship. “I’m barely scraping by with overtime,” he said.
Last month three of the nation’s largest unions sent a letter to Harry Reid and Nancy Pelosi, warning that Obamacare would “shatter not only our hard-earned health benefits, but destroy the foundation of the 40 hour work week that is the backbone of the American middle class.”
NBC News spoke with almost 20 small businesses and other entities from Maine to California, and almost all said that because of the new law they’d be cutting back hours for some employees – an unintended consequence of the new law.Beyond NBC's 20 there are national chains which have announced cut backs. For example, WalMart Stores is lowering its portion full-time employees to part-time status (40%-20%) company critics say, which will have the effect of limiting health insurance, even though the company is expanding coverage for its part-time workers.
Many businesses are reluctant to talk about cutting hours for fear the public will view them as stingy or uncaring about their workers. But Goodridge said that many small businesses have very small profit margins and that while he already provides health insurance to senior employees, offering health insurance to many more workers would require him to pass a significant price increase on to his customers.The workers who's hours have been cut will be hit from both sides. Along with lower take home pay, as Company healthcare costs rise thanks to Obamacare, those costs will be passed along to the consumer (along with the higher costs of energy thanks to Obama's policy of raising the costs of fossil fuel) resulting in higher prices for necessary staple items.
Those price hikes will hit everyone, as will the economic slowdown (can you have a slowdown of a slowdown?) bound to result from this president's polices.