While the employer mandate isn’t set to kick in until 2014, businesses are already making preparations to comply with the new regulations. A new study reveals bleak trends for employees as businesses try to survive under Obamacare:

“Some 31% of franchise businesses and 12% of non-franchise businesses say they have already reduced worker hours because of the law.

About 27% of franchise businesses and 12% of non-franchise businesses have already replaced full-time workers with part-time employees because of the law.

Some 41% of the non-franchise firms say they already see health-care costs rising because of the law.”

Sadly, the very law that was supposed to help employees is causing more harm than good  – just ask Kathleen and her husband, who have owned and operated 2 family restaurants in Albuquerque, New Mexico, since 1976.

With approximately 70 employees, the Albuquerque business owners have always understood that employing the best means providing the best, which Kathleen and her husband did.

“We were proud to begin providing healthcare insurance for our employees in 1980. Initially, we paid 50% of the total premium for employees and their families working 25 hours per week or more.  A couple of years later we added 50% payment for dental insurance. Since the beginning, our business has also provided other benefits to all our employees including paid vacations, profit-sharing, Christmas bonuses, 5- and 10-year service awards, free meals, etc.

By 2008, as the business grew, we increased the health insurance benefit to 100% of the premium for management, and maintained the 50% benefit to hourly workers with 25 hours per week or more schedules,” Kathleen explained.

Yet, the generous benefits that they choose to provide their employees had to be scaled back – thanks to the unaffordable costs of Obamacare on their business.

“We learn that we are a ‘big’ business, employing 70 persons with 52 full-time employees. As we’ve calculated the additional expense of paying fines for some employees, ensuring that the plan offered is “affordable”, the increase in premium as additional plan requirements kick in, extra federal record keeping, we found that Obamacare will probably add $384,000 to our healthcare insurance expense. That is triple our usual profit margin, and there is only so much you can charge for an enchilada plate, especially in this economy,” said Kathleen.

Not wanting to layoff any of the staff, Kathleen and her husband had to tighten their belt and do the inevitable. The company changed to a less costly, less beneficial insurance plan. They also eliminated paid vacation time unless an employee has 5 years service and year-end Christmas bonuses for all but management. For future new hires, they will be restricted to 28 hours a week.

“So the real losers are the employees. They are losing benefits that we gladly paid in the past.  And we’re losing the ability to attract the best workers because our benefit package has been slashed by federal mandates. My husband and I are sick about this. We love our employees,” Kathleen vented.

Thankfully, Kathleen’s employees understand why the cuts were instituted. They tried to make light of the difficult situation by posting the following on the restaurant sign, “If you like your burrito, you can keep it. Period.”