The Affordable Care Act is putting the squeeze on many industries including Trader Joe’s. Trader Joe’s is going to stop offering coverage for employees who are not full time. Like many industries Trader Joe’s may quit hiring as many full time employees. By law a business with over 50 employees only has to offer the coverage to the full time workers or it will face a large tax penalty up to $3,000 per an employee. Trader Joe’s is going to offer the part time employees a $500 payment to help subsidize their health insurance, which many will have to purchase through the Obamacare health exchanges.
This type of action is not uncommon today and will most likely be popular next year. PF Changs is another company that recently stirred the pot when it announced a change in offering full time status. UPS is another company that had to cut insurance to 15,000 spouses. Many great US companies always offered health insurance to all employees but it is increasingly difficult with the rising healthcare costs.
Trader Joe’s released this statement:
“Depending on income you may earn outside of Trader Joe’s, we believe that with the $500 from Trader Joe’s and the tax credits available under the ACA, many of you should be able to obtain health care coverage at very little if any net cost to you.”
It will be interesting to see if Obamacare can truly provide these workers with 12 months coverage for a one time payment of $500. I expect it is best for most Trader Joes employees to fill out the form on the top of this page or to fill out an Obamacare Application to see what subsidy they qualify for.