Walmart Cuts Health Coverage for 30,000 Part-Time Employees
Wal-Mart Inc, one of the largest retailers in the world, announced Tuesday that it would stop offering healthcare insurance to employees that worked less than an average of 30 hours a week.
The insurance-cut would go into effect by January 01, 2015. Wal-Mart's decision to discontinue health insurance follows similar steps taken by rivals like Home Depot and Target.
Wal-Mart expects 30,000 employees to be affected by the insurance curtails. The retail chain said that it was waiving off health cover for part-time employees because the number of workers signing up for healthcare benefits exceeded their expectations after they rolled out the Affordable Care Act, according to USA Today.
"Like every company, Walmart continues to face rising health care costs. This year, the expenses were significant and led us to make some tough decisions as we begin our annual enrollment," Sally Welborn, Sr. vice president at Wal-Mart wrote in a blog on the company's website.
"We will continue to provide affordable health care to all eligible associates, including part-time, who work more than 30 hours. However, similar to other retailers like Target, Home Depot, Walgreens and Trader Joe's, we will no longer be providing health benefits to part-time associates who work less than 30 hours. This will impact about 2% of our total U.S. workforce. We will be working with a specialist, HealthCompare, to personally guide our associates through the process of finding the right, affordable health care," she added.
Analysts say that Wal-Mart's decision to cut health benefits for part-time employees may trigger a domino effect among other retailers in the United States and force them to re-think the benefits they offer to the employees, Reuters reports.
"All retailers are trying to cut expenses, to keep things lean," Yarbrough was quoted by Reuters. "At some point you start looking across the board, and this is probably the next place to start looking at cuts."
