I’m talking about John Schnatter (even his name is douchy), CEO of Papa John’s (barely) Pizza, as well as Darden Restaurants Inc (who own Red Lobster, Olive Garden, and Longhorn Steak House) who have all said that they will be cutting their workers’ hours so that they don’t have to offer them health coverage, as mandated by ObamaCare.
Let me tell you the number of ways this is douchy. The most obvious, is that this is a PR nightmare. I believe that most Americans are good people, who want the people that prepare their food to be able to live a life that includes health insurance. I don’t believe that (with the exception of ideologues) most of us have a problem paying a few cents, or even a few dollars more for restaurant meals if that means providing health coverage to the employees that prepare and serve those meals. How do I know this? Because since 2008, restaurant patrons in San Francisco have been paying an extra 4% on each meal they consume, so that the restaurant workers in San Francisco have universal coverage. This 4% charge hasn’t made it any easier for me to get a table at The Slanted Door when I’m in town, so I’m guessing that San Franciscans aren’t eating at home because that 4% is overly burdensome.
It’s also douchy because these announcements are clearly politically motivated. The announcements didn’t have to be made. They could have quietly implemented the WalMart model of two part time employees, rather than one full time employee in order to avoid providing any benefits at all. No, they want to make a last ditch effort to scare people into believing that ObamaCare is a bad thing.
But the douchiest part of this, is that it demonstrates how bad these people are at business. Remember what I told you about San Francisco and the added charge for health insurance? Well, a lot of restaurants in San Francisco have turned these surcharges into a profit center. They’re pocketing some, if not all of the money. Wayfair Tavern in downtown San Francisco collected almost $64,000 from it’s customers in 2010. They spent a little over $6,000 of it on health insurance for their employees. I’m not going to go into how they did this, since it’s not relevant to this post. You can click on the link in this paragraph to get more information on it. My point is that John Schnatter, who claims that providing insurance for his employees will cost consumers fifteen cents more per shitty pizza. If he weren’t so blinded by his own douchiness, he would have realized that quietly raising the prices by fifty cents for each inedible pie, would have increased his profits. This would have enabled him to buy another obnoxious castle, while treating his employees to doctor visits. It would have been a win/win, but he douchebagged himself into a lose/lose.
When people don’t have insurance, and can’t get full time hours, they leave as soon as they can so you create a fast-spinning revolving door of employees. As an HR professional, I can tell you that it costs significantly less to keep an employee happy than it does to replace them. In the high tech arena, the cost of replacing an employee can range between 60 – 200% of that employees annual salary. I’m positive these percentages are much lower in fast food, but I’m also positive that it’s cheaper to garner some loyalty and slow the spinning of that revolving door. You have to pay to add an employee to your payroll system, and then you have to pay to remove them. You have to pay someone to perpetually interview new employees, and you have to pay someone else to process the new hire and termination paperwork.
This whole thing is douchy, and it’s bad business. So I say boycott, boycott, boycott! And to the idiots who say that this will cause layoffs, don’t you think I thought of that? You can take your business to Little Caesars, who have no plans to fuck their employees because they never wanted to treat them humanely in the first place. An increase in business at Little Caesars means more hiring of employees who will get the benefits they need. Laid off Papa John’s employees can get a better job down the street.
