Answer: In the same miserable boat as every other unlucky business struggling with the crushing costs and burdens of the mandate.
Among the first and most prominent recipients of the Obamacare waivers for favors were large restaurant chains that provide low-wage, seasonal and part-time workers with low-cost health insurance plans called “mini-med” plans. An estimated 1.7 million workers benefit from such plans. Obamacare forced companies carrying such coverage to raise their minimum limits on coverage to no less than $750,000 annually. Another Obamacare provision forces all employers to spend at least 80 percent to 85 percent of their premium revenue on medical care.
The social justice Democrats’ goal was to dictate insurance provider spending not just on coverage amounts, but also on executive salaries, marketing and other costs. The regulation punished companies with mini-med plans whose high administrative costs were due to frequent worker turnover and relatively low spending on claims — not “greed.” Complying with the provision would have meant tens of thousands of low-income workers would lose their benefits altogether.
Darden Restaurants, the Florida-based parent company of Olive Garden, LongHorn Steakhouse, Red Lobster and other chains, was a member of the Obamacare waiver early bird special. Their get-out-of-Obamacare card helped spare the company’s health insurance benefits for nearly 34,000 employees. Breathing a sigh of relief that it would allow chains to continue offering all employees access to affordable health insurance, Darden said in a statement in the fall of 2010 that “the waiver allows us to continue to do that as the various phases of the health care law are implemented.”
Fast-forward to 2012. Darden announced last month that it would begin shifting full-time workers to part-time status to save money, cut health costs and circumvent Obamacare’s coverage mandate scheduled for full implementation in 2014. The move would reduce full-time employees’ hours to less than 30 hours a week; part-time workers are exempt from the insurance mandate. McDonald’s, another big Obamacare waiver recipient, is considering the same move.
In fact, a survey of members of the Chain Restaurant Compensation Association (CRCA) conducted last year by Hay Group reported that a whopping 77 percent of “quick serve” restaurant operators said they were considering reducing employee hours to change their status from full-time to part-time. At least one Denny’s restaurant franchise owner in Florida is cutting hours and has openly contemplated an Obamacare surcharge. Jimmy John’s and Papa John’s are also slashing work hours. Applebee’s is mulling a freeze on both hiring and expansion.
“There’s no such thing as a free lunch” is a race-neutral truth. But economically illiterate Obama supporters have now called for boycotts of these businesses and accused them of vengeful “racism” against the president. Instead of sympathy and gratitude for private businesses trying to do right by their workers, customers and shareholders, the corporate-bashers inundated Twitter this week with profanity-laced condemnations of the restaurant service industry. One protester tweeted: “@Applebees Your CEO is a racist piece of (redacted), he not hiring because Obama was elected ...U WILL LOSE CUSTOMERS.”
“Red Lobster, Olive Garden (are) using Obama re-election as an excuse to deny employees benefits and living wages,” Jon Marquis fumed.
Twitter user Daphine Walker sent unhinged, ungrammatical messages to Red Lobster and Olive Garden in all-caps: “I WILL NEVER SPEND ANOTHER CENT ON THIS RACIST COMPANY WHO DOESNT GIVE A DAMN ABOUT THEIR EMPLOYEES.”
The CEO of Red Lobster and Olive Garden is black. But no matter. Regardless of the actual facts, economic realities and entirely predictable and inevitable consequences of command-and-control government mandates, it’s always about identity politics for the Obama grievance mob. In good times and bad, the left never grants waivers from the race card.
Michelle Malkin is the author of “Culture of Corruption: Obama and his Team of Tax Cheats, Crooks and Cronies” (Regnery 2010).