Eldon grocer urges change in health law's "full time' definition (VIDEO)

Eldon grocer Steven Hermann told a U.S. House subcommittee Wednesday the new federal health care law's definition of "full-time employee" needs to be changed.
Eldon grocer Steven Hermann told a U.S. House subcommittee Wednesday the new federal health care law's definition of "full-time employee" needs to be changed.

Eldon grocer Steven Hermann told a U.S. House subcommittee Wednesday the new federal health care law's definition of "full-time employee" needs to be changed.

Hermann, 34, vice president of Paul's Supermarket, told the House Small Business Subcommittee on Health and Technology he's been active in the grocery business for 20 years, working in the store his grandfather founded and his father still runs.

"I am fearful that the unintended consequences of the Affordable Care Act (ACA) will hurt our employees and undermine our values as a family owned small business," he said.

"Under the ACA, the definition of full time employee has created new barriers for our industry, where working an average of 30 hours per week is simply not considered full time."

Hermann, who testified on behalf of the National Grocers Assn., told the committee: "Independent grocers are proud to provide employment to hundreds of thousands of individuals, many of whom are working a second job or simply looking to help supplement their family's income.

"As such, the supermarket industry employs a large number of part-time workers to help meet the ever-changing needs and demands of our customers, which can change from day to day."

But, he said, the health care law "created new hurdles for businesses by greatly expanding the number of employees eligible for health plans, by defining a full-time employee as an employee who has averaged at least 30 hours of service per week over the course of a month."

And that new definition "will force small businesses to re-think how they hire and schedule part-time employees," Hermann told the committee. "Where an employer may have previously hired a new part-time employee with the expectation that they would work 33-35 hours per week, that employee will now be brought on knowing they are a part-time employee and their work week will be limited to less than 30 hours per week."

He said that independent grocers already face tight costs.

"The supermarket industry operates on razor thin profit margins," Hermann testified, "where net profit before taxes among independent grocers hovered around 1.65 percent.

"In this competitive industry pennies really do count and can make the difference between making a profit or not."

And, he noted later in the interview, his three stores' (Eldon, Lake Ozark and Osage Beach) competition includes other independent businesses as well as major chains, like Kroger-owned Gerbes, Iowa-based Hy-Vee and Walmart's "SuperCenters."

On its web page, the federal Labor department notes the Fair Labor Standards Act "does not define full-time employment or part-time employment. This is a matter generally to be determined by the employer."

That's the way it should stay, Hermann said in a telephone interview after his committee appearance.

"I would prefer they don't even define it," he said. "But 40 (hours) is what we consider full-time, for overtime (pay). Forty seems to me like a full-time work-week.

"Anything under 40 hours a week, I don't know how you would make a living."

U.S. Rep. Blaine Luetkemeyer, R-St. Elizabeth, is a member of the subcommittee and introduced Hermann and his testimony.

"This is important for these small businesses to keep their competitive edge," Luetkemeyer said in the telephone interview. "(The definition change) could cause him to be non-competitive."

Hermann added: "If it doesn't change, we've got a lot of uncertainty - and you've got costs that are taken away from expansion."

Expansion doesn't always mean a new or bigger location, he said.

"It can be as simple as putting a new produce case in, or freezer or new check-registers," he explained.

Luetkemeyer is an outspoken opponent of the federal health care law and would like to see it canceled.

But, if the law is going to remain on the books, he said, some of its provisions need to be changed so it works better for people and for businesses.

Luetkemeyer said Hermann "did a great job today of laying out his struggles with this law."

Hermann called the chance to appear before the Congressional subcommittee "a once-in-a-lifetime deal, to come up and be honest and truthful about what's going on in our communities."

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Additional resources:

House page featuring this subcommittee hearing

Video of the complete hearing