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Not So Fast: 10 Companies That Threatened to Cut Worker Hours to Avoid Obamacare Are Rethinking Or Backing Off

Some businesses threatened to drastically reduce staff hours to avoid Obamacare requirements. Are they actually following through?

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MSNBC’s Ned Resnikoff reported the Taco Bell cutbacks and a similar incident at Wendy’s restaurants in the Nebraska area, but the latter news report did not reveal the name of the parent company.

10. Regal Entertainment

In April, Regal Entertainment Group cut hours for all non-salaried employees just enough to avoid the ACA’s definition of full-time. “To comply with the Affordable Care Act, Regal had to increase our healthcare budget to cover those newly deemed eligible based on the law's definition of a full-time employee,” the company stated in a memo obtained by Fox.com. “To manage this budget, all other employees will be scheduled in accord with business needs and in a manner that will not negatively impact our healt care budget.”

As Think Progress said at the time:

that assertion rings hollow considering Regal’s soaring profits and lavish executive compensation. In 2012, Regal’s stock went up by over 20 percent, and every single major company executive, including the CEO, CFO, and COO, received a six-figure pay increase. CEO Amy Miles made off particularly well, with her pay rising by 31 percent to $4.45 million for the year, bolstered by a base salary increase of $750,000.

Regal Entertainment Cinema did not respond to requests for comment.  

As Lynn Parramore recently noted on AlterNet, a 2013 Gallup poll shows one in five Americans employed part time and at least one third of them want full-time work. A May study from the Employee Benefit Research Institute shows that part-time jobs jumped from 16.7 percent of the workforce in 2007 to 22.2 percent in 2011.

Employers have been shifting from full-time to part-time work long before Obama’s election or the Affordable Care Act. The law may provide further impetuous, but the decisions of AAA Parking, and other companies like it, represent an acceleration of trends already in progress. But there’s currently a bill in the California legislature that could bring such employers to heel. California Assembly Bill 880 would fine large companies (those with 500 or more workers) up to $6,000 for every employee on Medicaid. The law is specifically designed to discourage companies like, say, Regal Entertainment from executing employment policies that force the state to subsidize their low-wage employment strategies. The Los Angeles Times reports that “firms would face fines based on 110% of the average cost of health insurance for every employee who is enrolled in Medi-Cal and works more than eight hours a week.”

Jimmy John’s probably won’t be happy about that.

Jake Blumgart is a freelance reporter and editor based in Philadelphia. Follow him on Twitter at @jblumgart.

 
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