Skip to content
Catholic Online Logo

By Catholic Online (NEWS CONSORTIUM)

2/1/2013 (3 years ago)

Catholic Online (www.catholic.org)

Obamacare will compel corporations to contract out many departments.

Obamacare has some unintended consequences, of which hapless employees, are bearing the brunt. Employers, scrambling to avoid the costs and fines of Obamacare are downsizing and cutting back employee hours to get themselves out from under the gun of Obamacare. However, novel solutions are on the horizon.

You may love it now, but how about next year when you have to pay for it?

You may love it now, but how about next year when you have to pay for it?

Highlights

By Catholic Online (NEWS CONSORTIUM)

Catholic Online (www.catholic.org)

2/1/2013 (3 years ago)

Published in Politics & Policy

Keywords: Protean, obamacare, healthcare, employees, 1099, layoffs, cuts


LOS ANGELES, CA (Catholic Online) - Many corporations, such as Darden Restaurants, have drawn public ire for announcing that all employees would become part time, to ensure they did not have to pay their Obamacare benefits. Really, Darden cannot be blamed for doing what corporations do - which is to maximize shareholder value.

Employers acknowledge that there is a very real human cost to their actions. As employers issue pink-slips and smaller paychecks to employees, they recognize that their workforce will be stuck making do with less, and will be less healthy in the process. They also understand their efficiency and productivity will also be impacted to some degree.

However, what else can they do? Faced with costs that could cripple businesses that already struggle with low margins, such as the restaurant industry, employers must sometimes choose between strategic cuts or closing operations altogether. In a sense, employers are choosing the lesser of two evils.

There is another way however, which requires novel that employers rethink how they operate. The new model is referred to as "protean" and refers to a protozoa, a single-celled organism. The concept involves companies focusing exclusively on a core competency, and contracting out everything else.

Going protean means smaller payrolls because the only employees that a business keeps are those dedicated to providing the primary product or service. Other departments such as payroll and accounting, human resources, and such, are contracted out.

So instead of managing a corporation with say, a hundred employees, the business can downsize below 50, while contracting out their other departments. Under the new model,  accountants, marketers, and sales staff, for example, become independent contractors while the only employees that remain would be management. This immediately shifts the obligation of paying for healthcare to the individual.

The only caveat then, is that an employer must relinquish some control over their former employees, who for all intents and purposes, are now their own businesses. However, the cost savings to the employer is substantial and the loss of control marginal at most. In fact, one could argue that control might improve, since a business would no longer have to worry about firing an underperforming employee, and could instead simply choose to contract with someone else.

There are also rules which clearly define the difference between an independent contractor and an employee. Employers who treat contractors as employees can face stiff penalties, so they will need to show greater flexibility than they are used to.

Naturally, this was never the intent of Obamacare, which was designed to make corporations pay these costs, not (former) employees. The thinking was that corporations could bear these costs easier than individuals. However, competent business professionals always find a way, and they have now done so, exposing a major flaw in Obamacare.

Naturally, the sudden migration of millions of former employees from private employer-funded healthcare to government-subsidized healthcare will trigger a response. However, it was long predicted by economists who forewarned that creating a system of mandatory payments and fines for employers would result in precisely this phenomenon.

As the nation's businesses transition to the new model, it will remain to be seen if former employees embrace the opportunity to be owners of their own businesses or if they will balk at paying their share of the Obamacare mandate, which now falls on their shoulders as individuals.

That reaction, particularly if negative, will predicate congressional response. That response could change the Obamacare limits even further, rendering the new model moot by squeezing employers again. But for now, for employers who are seeking to preserve their revenues without laying off employees, going protean just may be the solution they need.

---


Pope Francis: end world hunger through 'Prayer and Action'


Copyright 2015 - Distributed by THE CALIFORNIA NETWORK

Pope Francis Prayer Intentions for February 2016
Universal:
That prisoners, especially the young, may be able to rebuild lives of dignity.
Evangelization: That married people who are separated may find welcome and support in the Christian community.



Comments


More Politics & Policy

CURTAIN CALLED: GOP debate starts hilariously as candidates fail to appear on cue Watch

Image of When candidates Marco Rubio and Jeb Bush's names were announced, the two men were still blocking their way. Sneaking past, Jeb grinned and bumped Donald Trump. Photo courtesy of ABC News.

By Catholic Online (CALIFORNIA NETWORK)

It is a bit trivial to say about such an important event - but the GOP presidential debate in New Hampshire this weekend could have done with a bit more rehearsal. Candidate Ben Carson came out too early, Donald Trump stood with Carson, and candidates Marco ... continue reading


'Faith is the great cure for fear': Obama speaks at annual National Prayer Breakfast in WA Watch

Image of At the annual National Prayer Breakfast, Obama spoke against Muslim stereotypes and hatred (AP).

By Kenya Sinclair (CALIFORNIA NETWORK)

During the annual National Prayer Breakfast in Washington, President Barack Obama spoke of God, fear and love. LOS ANGELES, CA (Catholic Online) - At the breakfast, both Democrats and republicans set aside their differences to build relationships based on their ... continue reading


After Iowa fail, Donald Trump vows to 'beat the ____ out of ISIS' Watch

Image of Many noted that Donald Trump seemed unusually subdued in New Hampshire. He claimed that he remained optimistic after his second place finish in the Iowa primary. Photo courtesy of Reuters.

By Catholic Online (CALIFORNIA NETWORK)

While he faced defeat in the Iowa caucuses, GOP presidential candidate Donald Trump was full of his usual bluster in New Hampshire. Never one to mince words, he vowed to "beat the ___ out of ISIS" if he was elected president. LOS ANGELS, CA (Catholic Online) - ... continue reading


'Ted Cruz didn't win Iowa, he stole it': Trump furiously rants on Twitter about Cruz's win demanding a new Iowa 'election' Watch

Image of Donald Trump calls for a new election or to nullify Cruz's results (Reuters).

By Thomas Heed (CALIFORNIA NETWORK)

When news of the Cruz campaign "mistake" concerning Ben Carson at the Iowa caucus reached Donald Trump, he was furious. The business tycoon took to Twitter to call for a new election or to nullify Cruz's results. LOS ANGELES, CA (Catholic Online) - Despite his initial ... continue reading


Republican Candidate Drops Out of Presidential Race: But who was it? Watch

Image of

By Abigail James (CALIFORNIA NETWORK)

Following a disappointing show in the Iowa caucus, with only 4.5 percent of the votes, Kentucky Senator Rand Paul has officially dropped out of the 2016 presidential race. LOS ANGELES, CA (Catholic Online) - "It's been an incredible honor to run a principled campaign ... continue reading


Political sabotage: Ted Cruz pleads GUILTY to wronging Ben Carson at Iowa caucus Watch

Image of Ted Cruz admitted his campaign started the lie that Ben Carson was dropping out of the race prior to the Iowa caucus (NY Times).

By Thomas Heed (CALIFORNIA NETWORK)

In a shocking admission, Ted Cruz admits his staff spread rumors of Ben Carson dropping out of the runnings just before the Iowa caucus voting began. LOS ANGELES, CA (Catholic Online) - As previously reported, the Iowa caucus was filled with surprises that included ... continue reading


A Night of Surprises: What went down during the Iowa caucuses? Watch

Image of Iowa caucus surprises with historical neck-and-neck race and Trump in second place.

By Thomas Heed (CALIFORNIA NETWORK)

The Iowa caucus results are in after a high-energy night fueled by rumors of foul-play, coin tosses and the waning smile of a smug Trump. LOS ANGELES, CA (Catholic Online) - Before the Iowa caucus, polls showed presidential hopeful Donald Trump as the leading ... continue reading


Trump leading in polls as he thanks Iowa's evangelicals Watch

Image of Donald Trump has cut Sen. Ted Cruz's advantage with evangelicals, according to a CBS News poll. (Jim Young, Reuters)

By Catholic Online (CALIFORNIA NETWORK)

As the Iowa caucuses heat up, executive Donald Trump has shown a strong lead over Ted Cruz in recent opinion polls. Trump took time to thank evangelical Christians for their support. In the meantime, Hillary Clinton maintains a thin lead over Bernie Sanders in ... continue reading


Whoa! Secret Microsoft algorithm predicts wins for Clinton, Trump in Iowa and beyond Watch

Image of Computerized predictions are big business, both at the sports book and in politics.

By Marshall Connolly, Catholic Online (CALIFORNIA NETWORK)

Hillary Clinton and Donald Trump are predicted to win tonight's Iowa caucuses according to a sophisticated algorithm used by Microsoft's Bing search engine to predict outcomes. The search engine has an excellent record. LOS ANGELES, CA (California Network) - Microsoft ... continue reading


FBI 'Guilty' of unlawfully refused Freedom of Information Act Watch

Image of U.S. district judge Randolph D. Moss ruled in favor of MIT PhD student Ryan Shapiro. Judge Moss found that the FBI's present policy is

By Catholic Online (CALIFORNIA NETWORK)

A judge in a Washington, DC courtroom ruled in favor of a PhD student at MIT and found that the FBI unlawfully, obscured, and refused to requests. The bureau was found guilty of not complying with the Freedom of Information Act, or FOIA. LOS ANGELES, CA ... continue reading


All Politics & Policy News

Newsletters

Newsletter Sign Up icon

Stay up to date with the latest news, information, and special offers

Subscribe to Catholic OnlineYouTube Channel

the FEED
by Catholic Online

  • Can you answer these four challenging questions about Lent?
  • Daily Reading for Tuesday, February 9th, 2016 HD Video
  • Daily Readings for Tuesday, February 09, 2016
  • MAKE YOURSELF COUNT! Complete this quick Ash Wednesday survey
  • 10 important things to consider during Lent
  • St. Apollonia: Saint of the Day for Tuesday, February 09, 2016
  • Stations of the Cross - Series HD Video

Daily Readings

Reading 1, First Kings 8:22-23, 27-30
22 Then, in the presence of the whole assembly of Israel, Solomon stood ... Read More

Psalm, Psalms 84:3, 4, 5, 10, 11
3 Even the sparrow has found a home, the swallow a nest to place its ... Read More

Gospel, Mark 7:1-13
1 The Pharisees and some of the scribes who had come from Jerusalem ... Read More

Saint of the Day

Saint of the Day for February 9th, 2016 Image

St. Apollonia
February 9: St. Apollonia, who died in the year 249, was ... Read More