After backlash, restaurant company clarifies Obamacare stance

An Olive Garden resturant is shown in New York's Times Square in a file photo from Jan. 10, 2006.
An Olive Garden resturant is shown in New York's Times Square in a file photo from Jan. 10, 2006.
AP Photo/Mark Lennihan, File

Under fire, the parent company for Olive Garden and Red Lobster again clarified its position on Obamacare on Thursday, saying that it would not try to shave healthcare costs by reducing the hours of full-time employees.

“None of Darden’s current full-time employees, hourly or salaried, will have their full-time status changed as a result of healthcare reform,” read a statement from the company, Darden Restaurants, Inc.

As msnbc has previously reported, Darden has recently begun employing a greater percentage of part-time workers at its newly opened stores, as a way of reducing the costs of complying with Obamacare. The company claimed that none of its current full-time employees would see their hours reduced as part of the experiment, though the worker group Restaurant Opportunities Centers (ROC) United claimed that many workers were seeing their hours cut for other cost-reducing reasons.

Bob McAdam, a spokesperson for Darden, confirmed that the new announcement was intended only as a clarification, though some media outlets have portrayed it as a change in policy. ”A great deal of media coverage characterized a test we were doing as a new company policy,” McAdam said. The press release was intended to rebut that coverage.

McAdam blamed that coverage for a consumer backlash which resulted in disappointing second quarter earnings. ROC United director Saru Jayaraman called the backlash and subsequent announcement “fabulous news” and “a very good first step.”

“An announcement is an announcement,” she said. “And yes, it does have to be proven in terms of what happens to real workers on the ground, because, frankly, the workers’ hours have been being reduced all along. But before, they weren’t even acknowledging that it was an issue.”

Darden’s clarification, said Jayaraman, proves two things: “One, consumers care about how companies treat their workers. They care, and other companies should take note. Two, consumers can actually have an impact.”

Notably, the announcement said that all full-time employees would continue to receive health care from the company, even though part-time employees have previously been covered. McAdam confirmed to msnbc that part-time employees could no longer be covered by company’s “mini-med” health care plan, because it doesn’t meet the minimum requirements for employer-provided health insurance set by the Affordable Care Act.

“Health care reform prohibits us from offering that plan,” he said. However, the company has received a temporary waiver that allows them to continue providing coverage at their current level up through 2014.

Jayaraman said that ROC United would continue to organize against Darden until it provided higher wages and better working conditions for all employees. “Our campaign is not over,” she said, citing low employee compensation and the absence of paid sick days.

UPDATE: A previous version of this story incorrectly quoted McAdam as saying that Darden was seeking a waiver from the Obama administration. In fact, the company has already received one.