San Francisco’s Golden Gate Restaurant Association has sued to stop implementation of the city’s new health care mandate, which would require employers who hire more than 20 workers to either provide them health insurance or pay about $200 per month into a city-run insurance fund, reports National Public Radio. The Association charges that the city law violates federal law regarding employee benefits.
NPR reporter Elaine Korry spoke with restaurateur Dan Schroeder, an Association member, who described the new paperwork requirements as an “accounting nightmare,” since he’s got different types of employees working for him. Schroeder pays health insurance for his 49 employees — many of whom are part time — but the city decided that the level of coverage he provides doesn’t cost enough, so he may have to pay as much as $70 more per employee.
Schroeder says he already operates on razor-thin margins, so if his labor costs go up he may have to lay off employees. Plus he’ll have to raise prices. And, he says, so will his butcher, his fish monger, and produce supplier. He doubts that city officials understand how even small price increases can ripple through the local economy, hurting small businesses.
Schroeder further told Korry:
You’re ending up sticking the most vulnerable businesses with the biggest burdens. It’s at the point where it doesn’t make any sense to be in business here anymore.
This is evil enough, but truly galling is the cavalier response from Joannie Chang, the city official — whose “phone hasn’t stopped ringing with calls from concerned employers” — charged with enforcing the new levy. Korry reports:
She says [the law] actually benefits employers like Dan Schroeder because it levels the playing field, requiring all businesses to do their part in tackling on the city’s health insurance crisis.
So San Francisco business owners have nothing to worry about — the politicians and lawyers know what’s good for them better than they do! Host Steve Insskeep introduced the report by describing San Francisco as having “some of the most worker-friendly employment rules in the nation.” But how “worker friendly” are onerous regulations that result in layoffs and across-the-board consumer price increases?