With full implementation of the Patient Protection and Affordable Care Act (aka ObamaCare) now within sight, every organization with a payroll and a modicum of good sense is getting serious about determining their strategy and tactics with respect to the act.
Some have already decided to go ahead and upgrade their health care insurance programs to make them compliant with both cost and coverage requirements of the act. Many are taking a “watchful waiting” approach to see how the first few organizations that pay a fine and dump their workforces (in whole or in part) onto the state insurance exchanges fare. Many others, particularly in the retail and hospitality sectors, signal that they will be shifting even more to a workforce constituted of part-time workers in order to escape the act’s coverage requirements. At first blush, the act seems to incentivize some to do just that. Although every management must decide what’s in the best interest of their stakeholders, it is this last group that we’d like to focus on.
In a recent webinar sponsored by People Report and Black Box Intelligence (very credible organizations that provide info. services to the restaurant industry), the unmistakable take-away was that reliance on part-time vs. full-time workers will be a Big.Dot.Issue. 82% of the mostly restaurant managements surveyed indicated that cutting worker hours in order to reduce the number of full-timers with mandated benefits would be their likely approach. Further, 80% of those surveyed indicated that it was their intent to hire a greater ratio of part-timers going forward.
On the surface, swapping one full-time worker for two or more part-timers seems a perfectly sensible thing to do if it helps you avoid a significant expense for worker health care benefits. Yet, managements that make such a move based purely on avoiding the cost of employer-sponsored health insurance are opening yet another, possibly costlier can of worms.
Regardless of the number of hours each person works, the addition of each incremental real, pulsating human being (RPHB), aka “heads” to the beancounters in the crowd, adds significant complexity and cost to the mix. Here are just a few of the factors to consider:
- Additional pressure on the physical plant (think bathrooms, parking spaces, work stations, et. al.)
- The task of communicating with and leading, directing, guiding the workforce becomes more complex. At some point, additional managers must be hired due to span of control issues.
- Recruitment and training costs go up, way up.
- Barring some clear and reasonably predictable way to migrate from part to full-time status, you must either recruit from a totally different demographic, or face the prospect of having a bifurcated (and not necessarily enchanted or engaged) workforce. (Think A-scale and B-scale and how well that worked for commercial airlines.)
We don’t advocate one approach over another. Rather, that each management team get beyond the surface considerations and consider all the implications. And, not to put any pressure on you, but you need to do it soon.
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A pathfinder in the arena of leadership and employee engagement, Bill Catlette is a seminar leader, keynote speaker, and executive coach. He helps individuals and organizations improve business outcomes by having a focused, engaged, capably led workforce. He is co-author of the Contented Cows leadership book series, and Rebooting Leadership. For more information about Bill, his partner Richard Hadden, and their work, please visit their website, or follow him on Twitter at http://twitter.com/ContentedCows
Having already wrung needed and significant concessions from them, the newly elected Governor of Wisconsin has been making a rather poorly disguised effort to nullify the collective bargaining agreements and rights of various groups of state workers, principally teachers. As with nearly every other issue of import these days, the whole world is suddenly watching, including like-minded governors in several other states who are licking their chops at the prospect of following the lead penguin into the drink. Whoa… Full Flaps, Brakes, Stop!
Politicians of every stripe, particularly in the State of Wisconsin, are predictably getting into their respective corners over the degree and methods by which deficit spending should be reduced at the expense of government employees, particularly those who are unionized. It’s a serious matter in nearly every jurisdiction, and one that deserves both sacrifice and some of our best thinking.
This morning, as I watched TV coverage of the space shuttle Atlantis touching down at Edwards Air Force Base in California, I said a silent prayer of thanks for the safe return of the craft and crew. Today’s landing completed the 124th successful space shuttle flight (of 126 attempts). That’s an admirable success rate for something that is still a quite dangerous activity. But is it really successful? What exactly have we succeeded at? More to the point, what did we set out to do? What is the mission of our space program?
Over the past dozen years we’ve worked diligently to build a brand centered on the premise that treating people (workers) right yields better business outcomes. The evidence is irrefutable. Whether in good times or bad, companies like Marriott International, Wegman’s Foods, Chick-fil-A, Pebble Beach Company, and a host of others skillfully (and profitably) use their relationship with employees as a competitive weapon.
