November 13th, 2012 08:06 EST
Will People Boycott Papa John`s Because of Schnatter`s Position on Obamacare?
Now that Barack Obama has been re-elected, it doesn`t look as if Obamacare (the Affordable Care Act) is going away. I was astonished yesterday to see a wave of negative sentiment, including boycott posters, posted on my Facebook news stream, towards restaurants who would like to waffle on paying health insurance to their humble employees.
One business entrepreneur, John Schnatter`s Papa John`s, especially stands out, with a political pizza pie in his face, as he gradually backs away from a vehemently anti-Obamacare position.
This is more of an art than a science, as Schnatter tosses out some figures, such that Papa John`s will have to increase their prices 10-14 cents per pie to offset the cost of paying their poor employees health insurance, (that oh, by the way) will cost them $5-8 million more per year. A Forbes article I read (Breaking Down Centi-Millionaire `Papa` John Schnatter`s Obamacare Math, by Caleb Melby) demonstrates some flaws in Papa John`s math, which you`ll probably want to take a look at.
The bottom line, is that a 10-14 cent increase is too much by roughly two times. That is, half of that increase would go right back in the coffers of this already exceedingly wealthy business man. I might qualify that, by saying this is only if Papa John`s continues to do the same volume.
An impending boycott, accentuated by social media, could have a sizable impact on their business, if order taker`s phones are silent. You might ask, who`s going to want to buy a pizza pie from someone who`s so stingy and greedy, that he`s trying to clip his own employees out of health care?
Schnatter cleverly deflects the problem to franchisees, who he suggests will have to cut their employees` hours to under 30, in order to skirt the perimeters of the Affordable Care Act law. But what productive employee is going to take that slap in the face? Here he or she is doing a good job, but their hours are cut so their employer won`t have to comply with the law.
Who, in their right mind, is going to want to work for Papa John`s? If you work harder and try to get ahead, you`ll be penalized with reduced hours and zero health care benefits! Where`s the incentive?
Is that `better pizza, better ingredients?` I don`t think so! Back to the misalignment of Schnatter`s math (which resembles Mitt Romney`s math for the budget). 2 million pizzas are slated for giveaways (don`t know over what period of time this covers?), which has a retail value of between $24 million and $32 million (according to Forbes). This value alone, would pay for 3 or 4 years of health care for Papa John`s employees.
An extra topping of irony comes by way of how the Affordable Care Act should work, under better conditions. If the employer promotes the Employer-Based Wellness Program, health costs could be greatly reduced for their employees, over time (perhaps from reduced doctor visits and from lower absenteeism). I think you can see what I`m getting at. How can Papa John`s implement better health care to their employees?
Maybe more exercise for drivers, who have to race from one delivery to another, could be encouraged. But what can they say about diet? You should eat at Whole Foods during your lunch hour? Free pizza may be one of the benefits for many PJ`s workers. Heart disease as a result of too many Supremes is not an issue that can reconciled very easily .