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Health care law could bring fewer working hours for some employees

The Affordable Care Act has some companies considering cutting some full-time workers' hours to part time so they won't have to provide health coverage to so many employees.
By CANDICE CHOI and RICARDO ALONSO-ZALDIVAR Modified: October 9, 2012 at 8:34 pm •  Published: October 10, 2012
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The owner of Olive Garden and Red Lobster restaurants is putting more workers on part-time status in a test aimed at limiting costs from President Barack Obama's health care law.

Darden Restaurants Inc. declined to give details but said the test is only in four U.S. markets.

Under the new health care law, companies with 50 or more workers could be fined if they do not provide basic coverage for full-time workers and their dependents. Starting Jan. 1, 2014, those penalties and requirements could significantly boost labor costs for companies in low-wage industries such as retail and hospitality.

Darden, which operates more than 2,000 restaurants in the U.S. and Canada, has about 180,000 employees. The company said about 75 percent of its employees are part-timers.

Bob McAdam, who heads government affairs and community relations for Darden, said the company is still learning from the tests.

McAdam noted Darden is not alone in looking at ways to keep labor costs in check, with companies across the industry prepping for the new rules to take effect.

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