White Castle, IHOP Both Say Their Businesses Are Going to be Threatened by ObamaCare
From Weasel Zippers:
(Cleveland Plain Dealer)- The White Castle hamburger chain fears that a health insurance reform law adopted earlier this year will put its profits on a downward slide.
The Columbus-based family owned restaurant chain – known for serving small square hamburgers called “sliders” – says a single provision in the bill will eat up roughly 55 percent of its yearly net income after 2014.
Starting that year, the bill levies a $3,000-per-employee penalty on companies whose workers pay more than 9.5 percent of household income in premiums for company-provided insurance.
White Castle, which currently provides insurance to all of its full-time workers and picks up 70 to 89 percent of their premium costs, believes it will likely end up paying those penalties. The financial hit will make it hard for the company to maintain its 421 restaurants, let alone create new jobs, says company spokesman Jamie Richardson. White Castle employs more than 10,000 people nationwide, and more than 1,200 in Ohio.
Though advocates of the health insurance bill say its reforms will boost employment, House Republican Leader John Boehner of Ohio, a vocal foe of the changes, says White Castle’s analysis shows how the law’s “job-crushing” impact will be most severe in lower-income areas, where jobs like those at White Castle are most needed.
“The irony is that in the name of expanding health care coverage, the administration is making it harder than ever for unskilled workers to get started in the workforce,” Boehner said in a missive on White Castle’s plight.
George Ebinger of New Jersey, who owns several International House of Pancakes restaurants, says the penalties for not insuring his 140 workers will cost roughly half as much as insuring them. He figures he will have to raise prices and possibly lay off workers to come up with the $220,000 he anticipates the penalties will cost.
REAPEAL!
7 comments:
Damn.
IHOP is one of the few restaurants here where Mr. AOW is welcome in his wheelchair.
Stuff like this will bring about the downfall of Obamacare, I believe.
White Castle's stance is bogus spinn..
this explains it better
http://freerepublic.com/focus/news/2547035/posts
Steven Kreisberg of the 1.4 million-member American Federation of State, County and Municipal Employees union, questions White Castle's calculations. His union represents food service workers in Ohio public schools and other institutions.
He figures many of the White Castle workers who would end up paying a significant amount of their income for premiums would opt to buy less expensive coverage from a federal exchange.
"Let's not forget that since the worker is declining their coverage, they don't have to pay insurance for that worker," says Kreisberg, the union's health care policy director. "So they would be saving money at the same time as they are paying the penalty."
White Castle recognizes it won't continue paying health insurance bills for workers who buy insurance on the federal exchange, but Richardson says the company predicts its insurance costs would still rise because its healthiest young employees, who make the least money, would be most likely to transfer to the federal program. An exodus of healthy workers from the company's insurance plan would drive up costs for those who remain, the company forecasts.
White Castle, which began offering health insurance to workers in 1924, is also examining whether it would make financial sense for the company to eliminate health insurance coverage altogether and have all its employees buy insurance on the federal exchange, says Richardson.
...there is definitely some Voodoo math here.. most of their employees are part tome and dont get insurance.. only the higher paid managers... who probably will opt for other insurance.. is WC really complaining about a tax 'Deduction' of some kind they will lose
Pastorius,
Let's hope you are correct.
Yeah, that's smart. Quote a union for unbiased information.
Cracked any heads lately, Mr. Union Trough feeding piglet.
White Castle will just be forced to drop insurance for its workers entirely since the penalty will remain the same.
Yep.
And, they will cut their work force, and replace as much as they can with machines.
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