Study says health law spurs cut in work hours

The Washington Times Daily - - Business - BY KEL­LAN HOW­ELL

As Pres­i­dent Obama’s new health care law strug­gles to sign up in­di­vid­ual Amer­i­cans for in­sur­ance, the law is fac­ing re­sis­tance from small busi­nesses, ac­cord­ing to a new re­port re­leased Wednes­day.

A study done by the In­ter­na­tional Fran­chise As­so­ci­a­tion and the U.S. Cham­ber of Com­merce found that 31 per­cent of fran­chise and 12 per­cent of non-fran­chise busi­nesses have al­ready cut worker hours to avoid higher costs of health cov­er­age in an­tic­i­pa­tion of the im­pend­ing man­date to pro­vide their work­ers with health care in­sur­ance.

Many busi­nesses are ad­just­ing their work­force and pay­rolls to avoid fac­ing even more re­quire­ments un­der the law for larger em­ploy­ers, the poll found.

“This re­search clearly con­firms what the anec­do­tal sto­ries have al­ready con­veyed,” said Stephen J. Caldeira, pres­i­dent and CEO of IFA. “This re­search should serve as a ma­jor red flag to Congress and the ad­min­is­tra­tion that un­less there is a statu­tory change to the def­i­ni­tion of a full-time em­ployee in the ACA, there will be fewer full-time jobs, more part-time work­ers and fewer over­all hours avail­able for Amer­i­cans to work as busi­ness own­ers ad­just their work­force to com­ply with the law.”

Many busi­ness own­ers said they were al­ready suf­fer­ing neg­a­tive ef­fects from Oba­macare, a year be­fore the small busi­ness in­sur­ance man­date goes into ef­fect. Some 29 per­cent of fran­chisees and 41 per­cent of non-fran­chise busi­nesses are al­ready see­ing health care cost in­creases due to the law. The law will force 28 per­cent of busi­nesses to drop cov­er­age for their em­ploy­ees. Ac­cord­ing to pro­jec­tions, the man­date will al­most dou­ble the per­cent­age of fran­chise-owned busi­nesses and more than triple the per­cent­age of non-fran­chise busi­nesses that will not of­fer health in­sur­ance.

“In­stead of pro­vid­ing af­ford­able health care cov­er­age to em­ploy­ees, the law will ef­fec­tively take hours and wages away from Amer­i­cans who need and want full-time jobs,” said R. Bruce Josten ex­ec­u­tive vice pres­i­dent for govern­ment af­fairs at the U.S. Cham­ber of Com­merce, which op­posed the health care law.

IFA of­fi­cials said that Congress could help em­ploy­ers by en­act­ing leg­is­la­tion that would re­de­fine full-time work sta­tus un­der the law.

Sens. Su­san M. Collins, Maine Repub­li­can, and Joe Don­nelly, In­di­ana Demo­crat, have in­tro­duced leg­is­la­tion called the “Forty Hours is Full-Time Act of 2013,” which would change the def­i­ni­tion of “full time” for the health law’s pur­poses from 30 hours to 40 hours per week and the num­ber of hours counted to­ward a “full-time equiv­a­lent” em­ployee to 17 hours per month. Sim­i­lar bills have also been in­tro­duced in the House.

The sur­vey polled more than 400 busi­nesses, both fran­chises and non-fran­chises, with from 40 to 500 em­ploy­ees.

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