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I suspect we'll see more of this....


Posted: Oct 11, 2012

In an experiment apparently aimed at keeping down the cost of health-care reform, Orlando-based Darden Restaurants has stopped offering full-time schedules to many hourly workers in at least a few Olive Gardens, Red Lobsters and LongHorn Steakhouses.

Darden said the test is taking place in "a select number" of restaurants in four markets, including Central Florida, but would not give details. The company said there has been no decision made about expanding it.

In an emailed statement, Darden said staffing changes are "just one of the many things we are evaluating to help us address the cost implications health care reform will have on our business. There are still many unanswered questions regarding the health care regulations and we simply do not have enough information to make any decisions at this time."

Analysts say many other companies, including the White Castle hamburger chain, are considering employing fewer full-timers because of key features of the Affordable Care Act scheduled to go into effect in 2014. Under that law, large companies must provide affordable health insurance to employees working an average of at least 30 hours per week.

If they do not, the companies can face fines of up to $3,000 for each employee who then turns to an exchange — an online marketplace — for insurance.

"I think a lot of those employers, especially restaurants, are just going to ensure nobody gets scheduled more than 30 hours a week," said Matthew Snook, partner with human-resources consulting company Mercer.

Darden said its goal at the test restaurants is to keep employees at 28 hours a week.

Analysts said limiting hours could pose new challenges, including higher turnover and less-qualified workers.

"It's a real problem for restaurants," said Howard Penney, a restaurant analyst and managing director for Hedgeye Risk Management.

Darden, the world's largest casual-dining company and one of the nation's 30 largest employers, said it offers health insurance to all its approximately 185,000 employees. Many are offered a limited-benefit plan. That type of coverage is being phased out under health-care changes, which will ban annual limits for most plans.

About 25 percent of Darden workers are full time, meaning they work more than 30 hours a week. Though employees say Darden already offers traditional health insurance to full-timers, Janney Capital Markets analyst Mark Kalinowski said the cost of providing that could become higher for Darden under the Affordable Care Act. Because that law requires everyone to have health insurance, more workers will likely choose its coverage, Kalinowski said.

"Even a modest jump up in the amount of employees that decide they want the insurance you're offering could have a meaningful impact on your bottom line," he said.

Under the system Darden is testing, employees are to be scheduled for no more than 28 hours each week. They can run over that if things get busy, but Darden acknowledged they are not supposed to exceed 30 hours.

At a new Olive Garden in Stillwater, Okla., former busboy Keaton Hasty said employees were routinely limited to 29 1/2 hours.

"It was 29 1/2, and they'd kick you out," said Hasty, a college student who now works at a pharmacy. "They'd always print off a little slip every day and say who was getting close."

And Michael Walker said when he applied for a job at a new Olive Garden in Hammond, La., he was told that except for a few "key training positions," only part-time jobs were available for hourly workers.

"Without having full health care … I don't see that as an option," Walker said. He decided to stick with his current job at another restaurant.

Darden told analysts last year it would consider changing its mix of part-time and full-time employees to reduce costs.

Darden has been aggressively keeping labor costs down. It has cut bartenders' pay and required servers to share tips with them. It also has eliminated busboy positions at Red Lobster and reduced the number of servers working each shift at that chain.

Labor costs as a percentage of sales have dropped steadily from 33.1 percent in fiscal 2010 to 30.8 percent in the most recent quarter.

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Employers for years have been putting employees on part-time schedules and limiting - insurance coverage to cut costs.Same old,

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But NEW excuse.

Yes - and

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their profits get bigger and bigger to pay those big bonuses and corporate salaries. Nothing new.

There are Republicans who want to lower minimum wage - Race to the Bottom

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We need to support all unions and all workers in our own self-interest.
Ryan wants to ELIMINATE the minimum wage. - And Romney, who chose this avowed extremist? NM
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x
I don't understand why Romney chose Ryan - RC
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Ayn Rand? Really?
He came with full backing of the Koch bros, who promised - to spend up to $400 billion to defeat Obama.
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Plus, he's supposed to reassure the base.

Plus, it seems more clear after watching him these many months that Romney, although probably more moderate, is actually in sympathy much of Ryan's libertarian/randian ideology.
Can you name names? I'd love to know what Republicans want to lower minimum wages - backwards typist
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I never heard that before.
Michele Bachmann - RC
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Actually, not lower it--eliminate it completely.
Well, that explains it, too, now doesn't it? LOL (nm) - backwards typist
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.
Never Mind. Those "some" Republicans can't be named in any article I looked up - backwards typist
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I find it hard to believe, too, because of where the article came from and it seems to be the only one multiplied over and over FROM THE YEAR 2010.

The one article stated it was AZ state and only for teenagers working part time.

Later on in the article, there was this:
"Luckily, despite the fact that some Republicans think the minimum wage is still too high for some workers, there are many, many folks who support a substantial wage increase. One of these folks is Senator Tom Harkin of Iowa, who in March introduced legislation to raise the minimum wage to $9.80 over two and a half years and peg it to inflation -- a move supported by over two-thirds of voters."

So, all in all, I think this article is bogus and another fear-mongering that has no basis.
I think some Republicans - RC
[ In Reply To ..]
Consistently vote against raising the minimum wage, while a few want it gone completely (Bachmann, Akin). But I don't think anyone wants to *lower* it, per se.

I guess doing away with it is technically lowering it to zero, though.

You're right. - (see message)

[ In Reply To ..]
I worked PT in the pharmacy at a local grocery store back in 1985. I was told, way back then, that the store only had a very few people in full-time positions as that was their policy to keep benefits at a minimum. At the time I didn't need health insurance (had an individual policy as my husband was self-employed), so it wasn't an issue for me.

I don't work for M*Modal, so I don't know the answer to this, but do they offer health insurance to their PT employees? Or Nuance? Just curious. It was available to PT folks at the MTSO where I worked before they got bought by MM, but it seems like we were told MM didn't have insurance for their PT people (but maybe I'm wrong).

I really wonder--do a lot of you MTs really not want some of the changes the ACA brings about? We got turned down by an ins. co. because my 59-yo husband had a slightly enlarged prostate (and, per them, COULD be needing surgery for that in the future). As if ANY 59-yo man might not fall into this category!!! I'm looking forward to not being unable to get ins. for pre-existings; and I'm also looking forward to access to a pool of ins. plans that are available to everyone, not tied to your employer. I'm just surprised that more MTs aren't in the same boat as me on things like this(?).

I think Nuance does - RC

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Offer insurance to PT. I'm PT with them but don't use the insurance, so I'm not 100% positive.

Part time over...30? hours, or 35 maybe. - The insurance STINKS, tho. NM
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x
I work 20 hours - RC
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But I think 30 is the requirement for insurance. Which is practically FT.

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