ObamaCare Hitting Union Members — And They're Upset
Investor's Business DailyInvestor's Business Daily – Wed, Sep 11, 2013 6:52 PM EDT
In 2005 unions trumpeted their Change to Win strategy to rev up organizing drives. In 2008 they campaigned loudly for presidential candidate Barack Obama's Hope and Change.
But the tone was subdued when some United Food and Commercial Workers locals launched a "change to the exchange" campaign this summer.
This latest effort aims to guide thousands of part-time union members who are losing health benefits. It shows ObamaCare's unexpected consequences that are playing out for union workers.
Unions didn't expect the law to bring about big changes for members, who already had prized benefits. They once were among ObamaCare's most ardent supporters. But now they're increasingly speaking out against it.
Big Labor Not Immune
Like some nonunion employees, part-time unionized workers who once got insurance via their employment are being told they'll have to buy coverage from the ObamaCare exchanges. Others who worked full time are being cut to part-time status and sent to the exchanges as well.
The UFCW's Interstate Health & Welfare Fund "will no longer provide medical and prescription drug benefits to employees who work fewer than 30 hours per week," reads a poster that can be seen on the website of Dedham, Mass.-based UFCW Local 1445.
UFCW Local 371 in Westport, Conn., has provided similar materials to part-timers at Stop & Shop who lost health benefits in the contract approved in March.
The UFCW and two other unions wrote in a July letter to top congressional Democrats Harry Reid and Nancy Pelosi that the Affordable Care Act threatens to "destroy the foundation of the 40-hour workweek.
Materials from the UFCW locals define part-time staff as those who average less than 30 hours a week "as measured by a look-back period" — straight out of ObamaCare regulations.
Thus, these union health and welfare funds will provide coverage only to workers who fall under ObamaCare mandates.
This is not so different from what some nonunion employers in low-wage industries are doing.
Trader Joe's will drop health coverage to workers clock ing fewer than 30 hours per week, the Huffington Post reported Wednesday. Instead, the upscale grocer will chip in $500 that part-timers can apply, with taxpayer subsidies, toward buying coverage via ObamaCare exchanges.
UFCW negotiators also won a commitment from Stop & Shop to make an annual contribution to part-time workers' health savings accounts attached to a high-deductible plan.
In a pact with UFCW Local 371, Stop & Shop will provide $1,500 per year to workers hired before March 2010, or $500 to workers hired as of March 2013.
The deal also limits the pace at which Stop & Shop can shift workers to part-time status to avoid liability for health benefits. If it shifts 5% or more of full-time workers hired by February 2011 to part-time in any year, those workers' benefits would be preserved.
Still, employee turnover will erode such protections over time.
It's not clear how many other locals are steering part-timers to ObamaCare's exchanges.
Subsidize Union Plans?
Both UFCW locals noted that labor operates nonprofit health funds with employers. Such Taft-Hartley plans, covering some 20 million workers, are threatened by ObamaCare, unions say.
On Wednesday, AFL-CIO delegates in Los Angeles were expected to vote on a resolution calling for an ObamaCare change for the nonprofit union plans.
Unions want the plans to get the subsidies offered on ObamaCare exchanges. If not, they fear, employers will drop out and direct workers to the exchanges, which are likely to be less generous.