Health Care Law Prompts Shift to Part-Time Workers

money in the handsThe health care bill signed into law by President Obama may be having an unanticipated effect. To avoid providing health insurance for full-time workers, a number of low-paying employers are increasing their numbers of part-time workers instead.

A shift toward part-time workers is most evident in industries that employ large number of hourly workers, including hospitality, retail stores and food service operations. Companies in those businesses are reducing worker schedules to less than 30 hours per week, making them part-time workers, The Wall Street Journal notes.

Starting in 2014, companies will have to extend health insurance coverage to workers who are employed more than 30 hours a week or face a $2,000 fine per worker.

Companies including Darden Restaurants (NYSE:DRI), which operates Red Lobster and Olive Garden restaurants, and Apollo Management’s (NYSE:APO) CKE Restaurants, parent of Carl’s Jr. and Hardee’s restaurants, say they’re moving toward recruiting more part-timers to reduce their health insurance costs.

However, other large employers, including Panera Bread (NASDAQ:PNRA), Marriott (NYSE:MAR) and Costco (NASDAQ:COST) indicated that the law would have no impact on their hiring plans.

The future of the health care law could hinge on tomorrow’s election. If President Obama is reelected, the law’s implementation is expected to continue as planned. If Mitt Romney is elected, the law could be repealed or modified.

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