Wal-Mart plans to cut P/T employees health insurance

Walmart Employee

By MainNewsOnline

Wal-Mart made an announcement that it will increase health insurance premiums for its US workforce from January 2015. Also, it will no more provide coverage for employees who work less than 30 hours a week.

This decision will affect 2% of the US workforce of the retail major. The decision has come at a time when the US companies are preparing for the January 2015 deadline under the Affordable Care Act. Starting then, it will be a compulsion for companies having 50 or more employees to provide health insurance to their employees who work at least 30 hours a week.

The compulsion has drawn criticism from some companies that are concerned about higher costs. Wal-Mart made the announcement on Tuesday in a blog post. The world’s largest retailer was of the view that more number of people had enrolled in its plans due to which, its annual forecast for health care costs had increased by 50%.

 Sally Welborn, senior vice-president of global benefits, said that not only Wal-Mart, but many other companies are witnessing a rise in healthcare costs. Announcements made by the company include the bi-weekly premiums for its quite popular and lowest-cost employee-only plans will increase by $3.50 to $21.90, it indicates a rise of 19%.

On an average, Wal-Mart workers earn $12.92 an hour. For quite some time, Wal-Mart is struggling to boost profits. During the past six quarters, US same-store sales are either going flat or have declined. Lately, Target Corp and Home Depot Inc. have also announced about the cuts in the benefits.

There are many who did not like Wal-Mart’s decision. They affirmed that the decision would primarily affect low-income workers. White House spokesman Josh Earnest did not find the news unusual. As per Earnest, big companies keep on reducing or eliminating health-care benefits.

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