Another brave business owner is making changes due to the Obamacare mandates and hopes to implement the changes by January 2014 when Obamacare is in full effect.
John Metz, a restaurant owner in South Florida, announced he will add a 5 percent surcharge to customer bills to offset the increased overhead his company faces due to the Affordable Care Act.
Metz, who operates Denny’s and Hurricane’s Grill & Wings, told the Huffington Post, “If I leave the prices the same, but say on the menu that there is a 5 percent surcharge for Obamacare, customers have two choices. They can either pay it and tip 15 to 20%, or if they really feel so inclined, they can reduce the amount of the tip they give the server, who is the primary beneficiary of Obamacare.”
Metz is also cutting employee hours, which is has become commonplace as of late within the restaurant industry. Darden Restaurants, Papa John’s, Apple-Metro and Jimmy John’s have begun to make similar changes in their workforces.
The restaurant industry has extremely high turnover and rarely hires employees on a full-time basis for “front of the store” positions. Full-time status has been commonly defined as 40 hours per week, but the Affordable Care Act now mandates workers putting in 30 hours per week or more be considered full-time. The administrative costs associated with hiring full-time employees is high for low turnover industries, but for high attrition rate industries like food service is astronomical.
Metz said his current insurance for full-time employees costs $5,000 to $6,000 per year. “Obviously, I’d love to cover all our employees under that insurance, 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 per year.”
With about 1,200 employees throughout more than 40 restaurant locations, Metz’ costs if he were to keep employee hours the same could have the potential to put him out of business, leaving all 1,200 employees jobless. The fines associated with Obamacare for employers who do not comply with the full-time employee mandates will face penalties of $2,000 per employee, which Metz claims will cost roughly $70,000 per restaurant annually.
Papa John’s and others have been targeted by leftwing media groups for making changes to their workforce and called for a boycott. To show support for companies having to make tough decisions in response to Obamacare, conservative citizen activist groups like Rebooting America are promoting “National Papa John’s Appreciation Day” via Twitter and other social media. The group has received national attention with Founder Justen Charters appearing on Fox Business Channel and more than 16,000 people have committed to the event via Facebook.
The event page reads, “Papa John’s has been targeted by the left for a boycott, for simply articulating that ObamaCare would hurt profits and force cutbacks in employee hours. Stand up to this nonsensical and illogical action and support Papa John’s this Friday!”
The group has also asked that anyone purchasing pizza on Friday to consider buying an extra pie to share with someone in need or a church group, charity or afterschool program.