The parent company of the Olive Garden and Red Lobster is seeing struggles from its resistance.
Darden Restaurants has made a concerted effort to reject the healthcare law requirement that employers provide their workers with health insurance, and this has caused the company to experience a backlash that it may not have expected.
Americans have been boycotting the restaurants in support of the hours and benefits of its workers.
The company had previously announced its intentions to cut back the hours of its employees in order to ensure that it would not be legally required to provide health insurance benefits to those workers. However, it has since announced that its bottom line has started to suffer due to the opposition that it has shown to the healthcare law put into place by President Obama.
The rejection of the health care mandate has generated strong negative press for Darden Restaurants.
The company had planned to force lower paid workers with part time hours to have to purchase their own coverage or to wait until 2014 in order to take part in the government health insurance exchanges.
In 2001, Fortune had placed Darden Restaurants on its list of the best 100 companies to work for. However, the company was just recently named among the 12 largest companies that are paying employees the least.
In response to some of this negative health insurance press, the company has noted a number of issues that have led to the sharp decline in business and revenue within the second quarter of this year. This included failed promotions and “financially stretched consumers.” It also said that its purchase of Yard House and Hurricane Sandy have played a role.
That said, it has also identified a potential backlash from Americans who have been taking part in a boycott of its 1,994 various restaurant locations.
According to the CEO and Chairman of Darden Restaurants, Clarence Otis, who spoke about the results of the company’s decision regarding health insurance, “Our outlook for the year also reflects the potential impact, though difficult to measure, of recent negative media coverage that focused on Darden within the full-service segment and how we might accommodate health care reform.”