Obamacare forces Denny's restaurants to cut workers' hours, add five percent surcharge to customers

Tuesday, November 20, 2012 by: J. D. Heyes
Tags: Obamacare, Denny''s, surcharge

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(NaturalNews) Americans were told during the recent campaign cycle that elections have consequences, and we're beginning to see some of them in the wake of President Barack Obama's reelection.

One of the biggest consequences so far is economic fall-out from "Obamacare," the president's love-it-or-hate-it healthcare "reform" law. A number of companies warned prior to the election that they would have to trim operations if Obama and enough of his supporters remained in office because they campaigned on promises to keep the law intact.

That's a problem, said business leaders, because the law contains hugely expensive requirements that are set to take effect beginning in 2013 - mandates they must comply with in order to remain in the good graces of government bureaucrats. So many are doing what they have to in order to keep their doors open: cut or lay off staff and close unprofitable or marginal production sites, in order to remain profitable.

'I've got to pass the cost on'

One of those business leaders is John Metz, a Florida-based restaurateur who owns and operates 40 Denny's family-style eateries as well as the Hurricane Grill & Wings franchise. He said recently he plans to add a five percent surcharge to customers' meals in order to pay for Obamacare's required health mandates. He also said he will have to cut back on employees' hours.

It's not that he wants to see his customers and employees suffer, mind you. "Although it may sound terrible," he says it's his "only alternative" if he wants to keep his business afloat.

"I've got to pass on the cost to the customer," he said in an interview with the Huffington Post.

"If I leave the prices the same, but say on the menu that there is a five percent surcharge for Obamacare, customers have two choices. They can either pay it and tip 15 or 20 percent, or if they really feel so inclined, they can reduce the amount of tip they give to the server, who is the primary beneficiary of Obamacare," he told HuffPo.

Metz's company, RREMC Restaurants, also owns several Dairy Queen franchises. He says he planned to use the surcharge in all his locations beginning in 2014, when Obamacare is fully implemented.

Metz said he will begin holding meetings in all his eateries beginning in December to discuss the surcharge and to inform employees "that because of Obamacare, we are going to be cutting front-of-the-house employees to under 30 hours, effective immediately."

Scheduling employees fewer than 30 hours per week means Metz's company won't have to comply with the law's mandated health insurance coverage.

It might be a hard sell, so to speak, but Metz hopes the meetings with employees will inspire them to action rather than alienate them.

"What we're going to ask them to do is to speak to their elected officials, to try to convey what this means in terms of their jobs and their livelihoods," he said.

Under Obamacare, companies with more than 50 full-time employees must offer up an approved health insurance plan or pay a penalty of $2,000 per employee to the federal government for each full-timer over 30 hours.

"I think it's a terrible thing. It's ridiculous that the maximum hours we can give people is 28 hours a week instead of 40," Metz said, adding the change is likely going to force many of his workers to find second jobs.

Other food chains like Olive Garden and Red Lobster are also considering reducing employee hours to fewer than 30 per week.

"Obviously, I'd love to cover all our employees under that insurance," said Metz. "But to pay $5,000 per employee would cost us $175,000 per restaurant and unfortunately, most of our restaurants don't make $175,000 a year. I can't afford it."

The job hemorrhaging has just begun

Scores of other firms are considering similar measures to cut employees' hours or cut the number of employees altogether. Some of them include:

-- Welch Allyn, a company that manufactures medical diagnostic equipment in central New York, said in September it would lay off 10 percent of its workforce, or about 250 people, because of Obamacare's Medical Device Tax.

-- Dana Holding Corp., an Ohio-based global auto parts maker, warned their employees of potential layoffs, citing "$24 million over the next six years in additional U.S. healthcare expenses." The company has already let go a number of white collar positions and has hinted at more to come.

-- Stryker, one of the world's largest medical device manufacturers, "will close their facility in Orchard Park, New York, eliminating 96 jobs in December," The Washington Times reports. Because of the Medical Device Tax, the company is looking at trimming its global workforce by five percent, which would amount to about 1,170 jobs.

-- Boston Scientific, another medical device maker, plans to cut anywhere from 1,200 to 1,400 jobs, while shipping many other positions overseas, to China.

This is by no means a complete list, but suffice it to say, Natural News will continue to follow the economic fall-out caused by Obamacare and other economically destructive government policies.






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