Even though the state-mandated health insurance proposals known as “ObamaCare” have not yet come into force, America’s largest movie theater chain has cut back the hours of all of its low-wage employees in order to escape the onerous financial obligations it will bring.
The move by Regal Entertainment Group, which operates more than 500 theaters in 38 states, is one of many institutions to respond in this way, and many others are expected to follow suit due to the law, which has a proper title of the Affordable Health Care Act.
According to reports, Regal cut working hours for non-salaried workers to less than 30 hours per week, which will classify them as “part time” under the threshold at which employers are required to provide health insurance.
The company announced the move in a letter to managers which specifically said that the “move was a direct result of ObamaCare.”
The letter, leaked to the media, discussed the issue this way:
“In addition, some managers have requested guidance on what they should tell those employees negatively impacted and, at your discretion, we suggest the following.
“To comply with the Affordable Care Act, Regal had to increase our health care budget to cover those newly deemed eligible based on the law’s definition of a full-time employee.
“To manage this budget, all other employees will be scheduled in accord with business needs and in a manner that will not negatively impact our health care budget,”
Other companies which had already scaled back working hours include restaurant chains Applebee’s and Olive Garden and a number colleges including Palm Beach State College in Florida and New Jersey’s Kean University.
The state of Virginia also rolled back the hours of all part-time employees to 29 per week in February, with officials from the state claiming that the new mandate would cost the state tens of millions of dollars a year. One Regal theater manager was reported by media as saying that the announcement had sparked a wave of resignations from full-time managers who have seen their hours cut by 25 percent or more.
“In the last couple weeks, managers have been quitting on a daily basis from various locations to try and find full-time work,” said the manager, who asked not to be named. “Regal up until now has never restricted anyone to anything below 40 hours.”
“Mandating businesses to offer health care under threat of debilitating fines does not fix a problem, it creates one,” he said. “It fosters a new business culture where 30 hours is now considered the maximum in order to avoid paying the high costs associated with this law.
“In a time where 40 hours is just getting us by, putting these kind of financial pressures on employers is a big step in a direction far beyond the reach of feasibility for not only the businesses, but for the employees who rely on their success.”