October 17, 2013

ObamaCare forcing companies to rethink hiring strategy?

Guests: Steve Hermann, Stephen Bienko

This is a rush transcript from "Hannity," October 17, 2013. This copy may not be in its final form and may be updated.

SEAN HANNITY, HOST: My next two guests are business owners who are being forced to rethink their hiring strategies, reduce their employees' hours all because of ObamaCare. But the worst part about all of this -- they both personally warned these lawmakers about the consequences earlier this month when they both testified on Capitol Hill. And yet our selfish lawmakers -- that wasn't a part of this debate this last week-and-a-half, two weeks. Their pleas for help -- well, when they voted last night, they were ignored.

Joining me now are the vice president of Paul's Supermarkets, Steve Hermann, and College Hunks Hauling Junk Moving owner Stephen Bienko is with us. That's a great name. I'm going to get to you in a second.

STEPHEN BIENKO, COLLEGE HUNKS HAULING AND JUNK MOVING OWNER: Thanks, Sean.

HANNITY: Steve Hermann, let me -- let me start with you. I found your story pretty interesting because both your grandfather and your father were in the supermarket business?

STEVEN HERMANN, PAUL'S SUPERMARKETS VICE PRESIDENT: Correct. Yes. Yes.

HANNITY: OK, and...

HERMANN: And my grandfather started it in 1968.

HANNITY: Yes, I mean, that's a pretty cool story. Now, independent grocers account for, what, about 25 percent of the entire U.S. supermarket industry now?

HERMANN: You're exactly right.

HANNITY: OK. And how many people work directly -- how many people's jobs are we talking about in that industry, in that 25 percent of the sector?

HERMANN: We account for 944,000 jobs, and that's, I think, $9 billion in wages. It's a staggering number -- $30 billion in wages. Excuse me. I believe I'm off on that number. So yes, it's a big deal.

HANNITY: All right, talk about -- because this is real-life scenario. We just played what the president promised. If you want your plan, you can keep your plan. Average family's going to save $2,500 a year. He said it would only cost $900 billion. It's going to be three times that amount.

What is the reality that you tried to warn Congress about, about the law?

HERMANN: Well, there's a couple things. And the way I look at it is that, you know, I'm a simple guy, simple business guy here in the Midwest, and I got a look at the small parts of it that affect me huge. And they have a new requirement of 30 hours is a full-time employee. And the last time I checked, I didn't know there was a requirement of what a full-time employee was by the government. So there's an intrusion there.

And if we look at that, there's potential for a cost increase up to 10 percent just by the additional employees that have to go on the health care. And we're a family business. We take care of our employees. We take care of them. And you know, we're going to do our best. But the problem is looking towards the future in our hiring practices.

And then also, they have a 50 full-time employee equivalent. So if you have a 50 full-time employee equivalent, which is a complicated calculation, you have to offer insurance also. And as I speak to members around my community that are right at that threshold, they're looking at, I might have to close my business down. If they close their business down, that means I have less people shopping in the grocery store.

So it's just a cyclical effect that goes across the whole board. So that's what we (ph) went (ph) on was the 30-hour full-time, and I think it's common sense. Like I hear you saying, common sense. That's what we do around here is common sense.

HANNITY: And I've worked in the restaurant business a lot of years when I was a kid. I was a dishwasher at 12, cook, busboy, waiter, bartender. I did it all. I know the supermarket industry's a lot like the restaurant business, very razor-thin margins. You don't have a lot of room for play in there. Am I pretty accurate about that? It's so competitive?

HERMANN: Oh, you're very accurate about that. We've got a 1.65 on our profit margin.

HANNITY: Wow!

HERMANN: And that's not much. And our health care right now -- our health care accounts for two thirds of that. So you look at about over a one percent cost in health care that's, you know, going out the door right there.

HANNITY: So...

HERMANN: And we've offered that. We didn't need the government to tell us how to take care of our employees. We already do take care of our employees.

HANNITY: Bottom line, are you going to have to reduce employees' hours? Are you going to have to let some people go?

HERMANN: Well, the thing is, like I say, we're a family business, so we're going to take care of people that have been with us and worked hard for us. I think you take care of people that take care of you.

The issue is looking forward into the future. Now, how are we going to handle it right now with taking care of employees that have been with us? You talk about charities. I'm on school board back in town here, and we have a Title I district, which means 50 percent free and reduced lunch, and we have a buddy pack (ph) program. And the buddy pack program used to be funded through the government, which was a great thing. Gives those students food on the weekends. It's not there anymore. So things like that that we help fund, we may not be able to fund anymore.

So they're just going to continue to hurt people. Their economists and the people up there, you know, on the Hill that model these things, they don't come down to where the real things happen.

HANNITY: All right, Steve Bienko -- by the way, I get a kick out of College Hunks Hauling Junk Mover owner? I mean, come on. That's pretty good business.

BIENKO: I appreciate it, and it's been good for us so far.

HANNITY: How many years?

BIENKO: Three years.

HANNITY: OK.

BIENKO: So we're a new start-up.

HANNITY: And how many people work for you?

BIENKO: Seventy-two overall.

BIENKO: You went to Congress. You said it's a serious threat, ObamaCare, to your company.

BIENKO: Absolutely. You know, as a former cadet at the United States Air Force Academy...

HANNITY: Good for you.

HERMANN: ... and a former trooper in New Jersey State Police and now an entrepreneur, I truly believe in the American dream. I believe in the prosperity and the opportunity that's presented to us and our obligation as citizens to help people establish that. And I'm now trying to do that as a business owner, as an entrepreneur.

As only open three years and having a mandate placed on us during our biggest growth period -- this is when we are trying to hire the most people, have them help us and grow, and most importantly, bring them on culturally into our culture, it's destroying that.

It presents that failing opportunity where we can truly provide a culture for them.

HANNITY: Are you going to have to hire people as independent contractors? Are you going to have to -- what are you going to have to do?

BIENKO: Not so much as independent contractors, but definitely a reduction of hours, where we have...

HANNITY: You have to get them below 30.

BIENKO: We're going to have to because it just -- in order for us to grow properly, we're not going to be able to afford it. We need every inch we possibly can get in our profit margins in order to help us continue to grow. We're going to have to reduce those individuals who come to us for 30...

(CROSSTALK)

HANNITY: ... more hours, and you want to give them more hours.

BIENKO: We want to give them more hours. They're happier and it presents a great culture for us, and that's what helps us grow. That's what's helped American (ph) grow.

HANNITY: I could never work for your company.

BIENKO: You sure could.

HANNITY: I'm not a hunk. I'm not a -- I'm old and gray hair and I'm fat, so -- I lost weight, though.

BIENKO: Somebody would think you're a hunk.

HANNITY: Oh, yes! There's somebody...

(CROSSTALK)

HERMANN: Hey, Sean?

HANNITY: Yes, real quick. Steve, real quick.

HERMANN: The independent contractor -- if you have independent contractors, it still goes through the calculations, so it doesn't help you out.

HANNITY: Unbelievable. I didn't even know that.

HERMANN: So they've got so many calculations in there...

HANNITY: Can't even get out of that.

HERMANN: Yes. Yes.

HANNITY: Unbelievable. All right, guys...

HERMANN: Not only does independent contractor -- help you out. Yes, it's a mess.

HANNITY: This is why -- this is why the House Republicans fought, for you guys. This is why Cruz got up there for 21 hours and 19 minutes.

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