Backlash? Florida Restaurants' Owner Retreats from 'Obamacare Surcharge'

By: Eric Giunta | Posted: November 16, 2012 3:55 AM
Dennys Obama
A Florida restaurateur has distanced himself from media reports that he will be implementing a 5 percent "Obamacare surcharge" at his 45 restaurants. He now insists no such plans are in the offing.

At least, not quite yet.

Several news outlets have reported that John Metz -- the franchisor of Hurricane Grill & Wings (five of which are corporately owned) and president and owner of RREMC Restaurants, which runs approximately 40 Denny's diners -- would be adding a 5 percent surcharge to each of his restaurants’ bills, as well as reducing his employees’ work hours, all in an effort to mitigate the expenses he will soon occur from the implementation of the Patient Protection and Affordable Care Act (“Obamacare”).

"If I leave the prices the same, but say on the menu that there is a 5 percent surcharge for Obamacare, customers have two choices. They can either pay it and tip 15 or 20 percent, or if they really feel so inclined, they can reduce the amount of tip they give to the server, who is the primary beneficiary of Obamacare," Metz told The Huffington Post Wednesday. "Although it may sound terrible that I'm doing this, it's the only alternative. I've got to pass the cost on to the consumer."

By Thursday afternoon, there were several calls over twitter and the blogosphere calling for a boycott of Metz’s businesses. Leftist CNN political analyst Donna Brazile joined those calls, and Gawker named Metz “America’s Meanest Business Owner” (among other expletives that are unpublishable in a family-friendly newspaper).

But spokespersons for Metz told Sunshine State News Thursday that the restaurateur’s comments were “purely speculative,” and later issued a public statement to that effect.

Under Obamacare, employers must provide healthcare coverage to their workers if they hire at least 50 full-time employees. The penalty for non-compliance is a fine of $2,000 a day per employee.

Metz will only consider imposing a surcharge if Obamacare is amended so as to require business owners to provide health coverage if they hire 50 full-time equivalent employees. For purposes of the law, a full-time employee is one who works 30 hours a week or more. A full-time equivalent would be an employee who works a certain number of hours (including overtime) within a legally determined time period, even if he is not technically a full-time employee.

Metz's 45 restaurants will, however, be reducing several employees' schedules to 28 hours once the Act goes into effect in 2013, so as to keep below the 50 full-time-employee threshold. 

"Despite recent media coverage, Hurricane Grill & Wings is committed to exploring viable and effective ways to deal with the changing economic climate, including the implementation of The Affordable Care Act,” spokeswoman Shelby Fox wrote in a statement. “We have always been, and will continue to be, 100 percent dedicated to our employees and customers and will work tirelessly to find solutions that are in their best interests.

“Hurricane Grill & Wings supports President Obama and the revision of healthcare in this country,” the statement continues. “The  5 percent surcharge mentioned in various online outlets is pure speculation and only a potential option should the law be re-written to include full-time equivalents. The surcharge is not to be implemented or considered at this time."

Fox clarified in a follow-up email that “[t]he surcharges are NOT being implemented at any restaurant locations; this includes Denny's.”

It isn’t clear how these statements can be reconciled with Metz’s reported comment to the Huffington Post: “We're trying to get more restaurant operators rallied around the concept of adding a 5 percent surcharge to their bill to cover the costs of Obamacare as opposed to raising prices.”

Metz may well be responding to popular -- and possibly political -- backlash. Fox told the News he's no longer granting interviews on the matter, and not a single one of the dozen or so major Florida-based businesses contacted by Sunshine State News would comment on the impact Obamacare will have on its prices, hiring, or employee scheduling. Even spokespersons for the Florida Restaurant and Lodging Association would not offer comment, except to say that the Association is watching with concern what effects the interventionist legislation will have on affiliated businesses.

The National Restaurant Association did, however, release the following statement to FOX News:

“We have warned for some time that the mechanics of the health care law are very difficult for the restaurant industry, which is a low-margin industry that works to keep costs down in order to provide value to customers.

“All costs, from gas and commodities to labor and insurance, eventually impact the price on the menu. It is important that operators get very familiar with the provisions of the law and start planning for its implementation; however, it’s premature to make a specific assessment of exactly how the law will affect any individual business because there are so many details that are unknown.”

Reach Eric Giunta ategiunta@sunshinestatenews.com or at (954) 235-9116. 

Comments (15)

11:49AM NOV 22ND 2012
How's this all working out for Denny's and Papa John's Pizza? . . . . . running for the hills now over the public revulsion and attacking Metz . . . . thought so . . . . .

The only surprise here is that this site didn't actually use the other demeaning photoshopped image of Obama . . . . . as a black witch-doctor . . . . maybe they couldn't get their hands on that one in time . . . . .

Regardless, pathetic . . . . .
5:50PM NOV 16TH 2012
more right wing tripe from 1%'ers. i have nothing but contempt for metz. he's had his way for 30yrs. time to get him an corporate america out of the public's pocket book and let them practice what they preach, capitalism. either you make it or you don't. if he won't provide health insurance then people will get it on the open market. if he tries to starve his employees he'll get poor workers an service will suffer. there are plenty of places to eat, we don't need his.
Roger Bennett
3:44AM NOV 17TH 2012
4:23PM NOV 16TH 2012
Doesn't he already offer his employees health care insurance or is he another one of those that put profits over people? Average CEO pay in such eating establishments like this and Denny's is 4 million annually. Go figure. Raise the minimum wage so people can afford to buy health insurance. Everyone in America should have access to affordable health care.
check your facts here
12:09PM NOV 16TH 2012
The penalty for not extending coverage to all eligible employees is $2,000 per eligible employee per year, not $2,000 per day.

If he reduced his employees' hours to less than 30 per week, they wouldn't be eligible and wouldn't trigger the penalty. He's not only stingy, he's a dope.
11:39AM NOV 16TH 2012
I think the author meant to write the fine would be $2,000 per year, not per day.

If it were the latter, then yes, if he is fined he might have to raise the price of Moon of my Hammy. haha
11:27AM NOV 16TH 2012
Boycott once all the buisness go under then what you think there in buisness not to make money. bunch of dumb asses.
11:27AM NOV 16TH 2012
Boycott once all the buisness go under then what you think there in buisness not to make money. bunch of dumb asses.
10:29AM NOV 16TH 2012
"Metz may well be responding to popular -- and possibly political -- backlash."

You might want to have your colon examined since you seem to be pulling a lot of things out of your rear end here without any proof.
10:12AM NOV 16TH 2012
I would like to see businesses and investors who expect REASONABLE profit margins and invest in their communities and employees. I think it's ridiculous that these companies can have sky high profit margins but plan to squeeze the soul and life blood out of the communities, customers, and employees in/to which they serve.
7:56AM NOV 16TH 2012
"....approximately 40 Denny's diners -- would be adding a 5 percent surcharge to each of his restaurants’ bills,...."

What would be even better if he adjusted the surcharge according to the unhealthy fats, sugar, and empty calories of the menu items. Oh wait, that would be about 95% of the menu. Oh well.

And as far as this:".... or if they really feel so inclined, they can reduce the amount of tip they give to the server, who is the primary beneficiary of Obamacare," Metz told..."

Yeah really, why would we want the servers to have health care and a living wage too? They're there for no other purpose than to serve us a meal and clean up after us. They don't need access to timely health care. If they should have an untreated strep throat infection, the flu, or a nail fungus and we catch it, so what. As long as we save 5% on our bill.

Sarcasm off and to borrow from a cartoon, I think I'll take my rage out on my body. I'm going to Denny's. (Not really, haven't eaten there in years due to the low quality food they serve.)
7:02AM NOV 16TH 2012
silly libtards, we you actually naive enough to think that the cost of obama's policies would not be passed onto the american people. business owners, whether republican or democrat are not going to just obsorb these costs.
1:58PM NOV 16TH 2012
Yes, let make it give the multi-millionaires a break day . . . makes as much sense as "Papa John's" owner John Schnatter's whining that the new health care law will cost his business about $5 to $8 million per year, while he's "giving away" 2 million pizzas (~$20 million worth) . . . . . . . yeah, too expensive to afford . . . . . I estimate that for various groups and other reasons, I've been ordering around 50-80 pizzas a year from Papa John's . . . . . he's decided to make this political, so will I . . . . no more Papa John's . . or Denny's . . . or Applebee's . . . . or WalMart . . . . or Sam's (switched to Costco) . . . . .or whoever else wants to be stupid enough and try to score far right political points by using their business against this election . . . . .

Pathetic . . . . .
John S.
11:33AM NOV 16TH 2012
Classy... Name-calling a whole lot of people because of the ideology they align with. Of course it is a given that the cost of everything relating to the operation of any business, including cost relating to human resources are passed on to a business' clients/customers.

Why is it okay for us customers to pay for all the first class everything that some business owners and executives? These luxuries are factored in the cost of their products/services and they don't tell us about it because they deserve it.

I don't resent that they can afford the luxury. They are entitled to that because they are enterprising and providing products/services that the public need or want or enjoy. However, going out there and bragging that they will have to either cut employees' working hours or actually telling the customers to reduce the tips they'd like to give the serving staff in these case because they are the ones benefiting from the law is just abominable.

Is this how job-creators are supposed to react when a new law is implemented? Is this how the rich really look at there employees? Like machines?

Who is instigating a class warfare now? The working class will fight back when oppressed.
Roger Bennett
3:55AM NOV 17TH 2012
Class warfare? You pretend to have an ounce of common sense, but never realize that those of us who buy our own health insurance in order to protect hard earned assets wind up paying approximately $2000 of our insurance premium, per year (for a two person "family" policy) to reimburse hospital emergency rooms for VERY expensiver treatment of people who show up with mostly easy to prevent and cheap to treat ailments because they have no health insurance. Class warfare? Coming from a guy who obviously repeats the rhetoric of the masters of class warfare, the radical right wing new Republican party, that charge rings exceedingly hollow. Or stupid, take your pick.

Leave a Comment on This Story

The content of this field is kept private and will not be shown publicly.
To prevent automated spam submissions leave this field empty.