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By Catholic Online (NEWS CONSORTIUM)

8/19/2013 (1 year ago)

Catholic Online (www.catholic.org)

Popular fashion retailer slashes hours, benefits in response to ObamaCare

Employees of the trendy fashion chain Forever 21 are cursing under their breath - and President Obama is more than just a little part of that anger as well. In reaction to the president's Affordable Care Act, Forever 21 is taking drastic steps. There will be no more full-time employees, all workers will work less than 30 hours a week, there will be no benefits - and no paid vacations.

Forever 21 says it 'recently audited its staffing levels, staffing needs, and payroll in conjunction with reviewing its overall operating budget.'

Forever 21 says it "recently audited its staffing levels, staffing needs, and payroll in conjunction with reviewing its overall operating budget."

Highlights

By Catholic Online (NEWS CONSORTIUM)

Catholic Online (www.catholic.org)

8/19/2013 (1 year ago)

Published in Business & Economics

Keywords: Forever 21, hours, salary, benefits, ObamaCare


LOS ANGELES, CA (Catholic Online) - Forever 21 will now limit its non-management workers' hours to 29.5 a week, just below the 30-hour minimum that the ACA deems full-time work.

Forever 21 says it "recently audited its staffing levels, staffing needs, and payroll in conjunction with reviewing its overall operating budget." Associate Director of Human Resources Carla Macias informed employees that effective August 31, they will no longer be full-time employees of Forever 21.

The move will likely harm the reputation of the company. Forever 21 employees are sure not to benefit from this new policy. All employees of the company in turn will function as a forthright example of the Affordable Care Act's consequences and shortcomings.

Analysts say that while highly unfortunate, Forever 21's policy is both rational and understandable. A company that boasts regularly low prices and frequent sales, Forever 21's success is largely dependent upon its ability to maintain low manufacturing and operational costs. Forever 21's management has the prerogative to take any legal measures necessary to avoid raising the costs of its products.

The decision poses moderate public-relations consequences for the company. On various social networking sites, there have been calls to boycott the company in a show of solidarity for employees. Forever 21 will subsequently be just one of many others to take such an action if the ACA isn't revised or repealed.

It's all a cold hard fact of business. The private sector relies on minimizing costs and maximizing earnings. Those who compete within the economy must achieve those standards within the confines of rules established by the government.

"It is probable that in a perfect world, Forever 21's management would love to continue employing full-time workers, provide them with substantial health care benefits, and maintain low prices for its customers. But in a nation with uniquely high health care costs, an issue that the Affordable Care Act fails to address, this is a regrettably unrealistic business model," columnist Maggie O'Neill declares.

"As long as health care costs remain as high as they are in the United States, many American companies will not be able to fund their employees' health insurance and provide their consumers with quality, cheap products. And as is inevitable in a capitalist economy, companies compelled to reduce costs will find a way to do so, even if their employees are disadvantaged in the process."

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