by Tom aka Rusty Rustbelt
Health Care Thoughts: California Assembly Bill 880 (pending)
It was a no brainer to predict Obamacare would have a major impact on restaurant and retail employers, especially in the throes of a weak economy. The composition of the work forces and often slim margins guarantee problems.
Darden Corp. (Red Lobster and Olive Garden) is infamous for whining and threatening layoffs, and of course Wal-Mart is well know as the “evil empire” of employers (the ACA part-time employment provision is often referred to as the “Wal-Mart loophole).
A clear result of Obamacare was for employers to consider cutting as many employees as possible under 30 hours. In California this would make many employees of corporate giants eligible for Medi-Cal, and California politicians are not happy, thus the pending legislation.
Employers with more than 500 employees would pay a penalty (possibly $6,000 or more per year) to the state treasury for every employee on Medi-Cal. This appears to apply to seasonal workers, although the commentaries I have read are rather murky on the details. More research to follow. This could have a major impact on seasonal agricultural employment.
It occurs to me one solution would be to reduce the number of part-time employees and just make the full-time employees work harder. I’m not certain that is what the Assembly intends.
Stay tuned, this is a giant laboratory.