(Corrects third-last paragraph to say Darden "hired more
part-time workers" instead "making some workers part-time")
By Lisa Baertlein
July 3 The Obama administration's decision to
delay a key provision of the healthcare law, by giving employers
an extra year to offer insurance coverage, is not expected to
significantly impact 2014 hiring since many big businees were
prepared for the change.
Smaller businesses, which have been among the most vocal
critics of the law, say they are still coming to terms with the
system's cost and complexity and need the extra time simply to
make Obamacare work.
"It's a good thing they delayed it," said Doug Prestwood.
"There's just not enough information. It's just a big chaos."
The Patient Protection and Affordable Care Act, dubbed
"Obamacare", was passed in 2010 and upheld by the U.S. Supreme
Court a year ago. The administration announced Tuesday that
employers have an extra year to provide workers health
"I don't think this means that people are going to hire with
reckless abandon now," said David Lewis, chief executive of
OperationsInc, a Connecticut-based human resources outsourcing
and consulting firm that serves small to mid-sized companies.
"It's a can that's just been kicked down the road."
Administration officials have said the change affects less
than 5 percent of businesses, as an overwhelming majority of
employers already provide health coverage. But that could still
involve as many as 10,000 businesses and hundreds of thousands
of workers, according to reform advocates.
Many large employers already were on track to make the
change to their benefits in time for the previous 2014 deadline,
said Steve Wojcik, vice president of public policy at the
National Business Group on Health in Washington, D.C.
"If you're a large employer, your plans are well under way,"
Many companies which offer healthcare benefits began
planning changes in anticipation of the law months ago, because
workers usually enroll in plans in the fall.
Companies that plan to hire said it was due to increased
demand and not because the law was delayed.
"It will not change anything for us," said Bob Mayer, vice
president for human resources at Weis Builders, which is based
in Minneapolis and has about 150 employees. "Our staffing plans
are based completely on what we anticipate our growth in the
marketplace to be, and not on a federal law that requires us to
Jessica Aptman, spokesperson for ZocDoc, a doctor search
website, said the company provides "100 percent of healthcare
coverage for employees and their families, and we have no plans
to stop hiring. In fact, we're hiring aggressively."
The pause, however, will give businesses time to figure out
how to operate under the new law, whose significant reporting
requirements affect even companies with large numbers of workers
ineligible for coverage, said Michelle Neblett, the National
Restaurant Association's health care policy expert.
"It will help reduce some of the anxiety and fear of the
unknown out there," Neblett said.
Sears Holdings Corp "is already taking the
necessary steps to assess and ensure compliance" with the law
and does not expect the delay to impact hiring, said Howard
Riefs, a spokesman for the company.
Wal-Mart Stores Inc, the largest nongovernment U.S.
employer, said it is still evaluating the impact, if any, this
would have, but small companies like Kerns Trucking Inc in Kings
Mountain, North Carolina, are relieved to have another year. The
company, which does not offer health insurance to its almost 70
workers, is trying to decide whether to do so or pay the
"It's starting to come out now what some of the true costs
are. They're extremely high," said Doug Prestwood, vice
president of Kerns. "In our business, you have a plan before you
implement something, but it's like they voted this thing in and
now they're trying to write it."
Many businesses, including restaurants and retailers, had
complained that healthcare reform would burden them with red
tape and additional expenses that would hamper hiring.
But many retail and restaurant workers already aren't
eligible because they work fewer than the 30-hour a week
Last year, Olive Garden parent Darden Restaurants Inc
, in a brief trial, hired more part-time workers to
reduce health benefit costs. It quickly abandoned the effort
after a consumer backlash. Papa John's International Inc
suffered a similar fate when its chief executive said
he would make a similar move.
Questions around eligibility played a significant role in
the delay, said Neil Trautwein, vice president and employee
benefits policy counsel for the National Retail Federation.
"They figured out that employers weren't ready, that the
administration wasn't ready and the individual state
marketplaces were not ready," Trautwein said.
(Reporting by Lisa Baertlein in Los Angeles, Jessica Wohl in
Chicago, and Atossa Abrahamian, Madeline Will and Martinne
Geller in New York; Editing by Richard Chang)