Burger chain White Castle says that one provision in the new national health care law could cut it’s earnings in half, causing it to curtail expansion plans and slow hiring.
At issue is a measure that would slap employers with a $3,000 penalty when a worker’s contribution to health insurance premiums exceeds 9.5 percent of household income. The problem for a fast food chain such as White Castle is that many of their workers are on the lower end of the pay scale, so insurance premium payments will tend to eat up a higher percentage of a worker’s earnings, slaming them with the penalty.
The chain crunched the numbers, and in a statement to House Minority Leader John Boehner’s office, says:
In present form, this provision alone would lead to approximate increased costs equal to over 55% of what we earn annually in net income (based on past 4-year average). Effectively cutting our net income in half would have [a] devastating impact on the business – cutting future expansion and more job creation at least in half. Sadly, it makes it difficult to justify growing where jobs are needed most – in lower income areas.
Via Jeffrey Anderson.