Businesses Plan To Cut Jobs Due To Obamacare

Because of the mandate for employers to provide employees with health insurance or face being taxed many small businesses are already planning to eliminate jobs. According to the mandate, businesses with 50 or more full-time employees will either provide coverage or pay the tax (yes I know Obama calls it a penalty, but the interpreters of the law call it a tax). This tax will be $2,000 per employee minus the first 30 per year.

If you are a small business owner, you have Barack Obama and his Democrat sidekicks to thank for the hopelessness and change that you are faced with.

Here are a couple of businesses that are trying to deal with the mandate and keep their businesses from going under.

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Kari DePhillips, who co-owns the Content Factory, a public relations firm in Pittsburgh, was hoping she could just break up the company to sidestep the rule. Maybe one firm would do marketing while the other builds websites.

The small company is on pace to exceed the 50-worker threshold in the next few years. DePhillips doesn’t want to provide health care, and she definitely doesn’t want to pay the penalty, which would be $2,000 per full-time worker minus the first 30.

“A $40,000 fine to my company would be catastrophic,” she said.

Ms. DePhillips has a great idea in doing that. That’s because she is an entrepreneur. However, her plan won’t work because the government considers both companies as a “controlled group.” It’s not about what they do, but who is in control of the company.

A Washington D.C. attorney, Christopher Condeluchi, claims, “These rules are intended to snuff out this type of abuse. You cannot get around the employer mandate.”

Well Mr. Condeluchi must be a Democrat to call owning a small business and wanting to determine how employees are paid and if they will provide health insurance or not an “abuse.” Again, while he claims that people can’t get around the employer mandate, he obviously hasn’t been around long enough to understand the entrepreneurial spirit. If Ms. DePhillips has a husband, a friend, relative or someone else who could control the second business that might possibly work, thus eliminating the need to worry with the mandate.

This is always the problem when government tries to manipulate the people with laws. People will always find ways around them. In all of this government isn’t providing anyone with anything but a burden and a hassle, not to mention more taxes.

The mandate is already pressing for decisions from larger businesses who have far more employees under a corporate umbrella.

That’s the reality for the 425 workers at David Barr’s nearly two dozen KFCs and Taco Bells across Alabama and Georgia. Barr has already done the math.

He currently provides health care for managerial staff only, and it costs him about $125,000 to cover the 30 who take it. Extending that to every full-timer would cost him another $545,782 a year.

Health reform’s creation of state insurance exchanges promises to bring down those costs, but Barr said any expenses even close to that will still outmatch his available cash.

“This business model isn’t meant to support those costs,” he said.

To minimize expenses, he’ll fire workers and cut hours to reduce the number of full-timers to 60. Then he’ll opt for the penalty instead of paying insurance. A $60,000 fine pales in comparison to the huge potential rise in health care costs.

While all the talk from Democrats and Barack Obama may sound good to many people, the reality is that Obamacare will be an enormous burden on employers and consequently on employees. Just imagine the unemployment rate when these companies implement their policies due to Obamacare. We will see a skyrocket of unemployment and a huge dependence upon government. We will also see costs of goods and services go up as businesses have to use automated machines to do what employees once did and they will be forced to still pay the tax if they don’t provide health insurance and guess who will end up with the bill? The consumer.

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