Darden Restaurants, the parent company of Olive Garden and Red Lobster, among others, telegraphed earlier in the month that its earnings had dropped, in part due to public backlash over the company's plan to drop all of its hourly workers below the 30 hours a week that would make them eligible for employer-provided health coverage under Obamacare. Now the company's fiscal second-quarter numbers are out, and it turns out that Darden Restaurants suffered a 37 percent drop in net income:
For the three months ended Nov. 25, the company said it earned $33.6 million, or 26 cents per share. That's compared with $53.7 million, or 40 cents per share, a year ago.
Because Darden continues to see public outrage over its initial plan to cut workers below 30 hours a week to avoid providing health insurance as a reason for its earnings drop, company executives continue to put the word out that they won't be following through with that plan. But since 75 percent of Darden's hourly workers already don't get 30 hours a week of work, and Darden has been aggressively cutting labor costs through both pay and staffing cuts, it's not like this backtracking makes it anything but an exploitative, race-to-the-bottom kind of business. It's just one that got caught trying one particularly politicized trick and is trying to get out of trouble over that.
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