Whole Foods Just Announced a Surprising Change That Left an Employee ‘In Shock’ and Could Totally Alienate Their Most Loyal Customers – Inc.

Posted: September 19, 2019 at 6:41 am


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This article is about Whole Foods, and its decision to stop offering health insurance to 1,900 part-time workers as of January 1.

But first, a public service message: If you ever know parents whoadopta child, but who run into trouble adding their child to their health insurance, tell them there's a federal lawthey need to learn quickly: 29 U.S. Code1169(c)(1), which was part of the Omnibus Budget Reconciliation Act of 1993.

I learned about this law a few years ago, when my wife and I adopted our daughter, and our health benefits administrator simply refusedto add her to our policy. It was a rough ordeal -- hours and hours on the phone, running up medical bills in the meantime, and being distracted during time I wanted to spend with my family.

Ultimately, we won, after Iwrote some stern letters and threatened a lawsuit. The company evenapologized and promised to change how they train their employees. I'm telling about it now for other parents' benefit, of course, but also because it's probably my biggest Health Insurance Nightmare Story.

Many of us have one.And that shared experience is why the Whole Foods decision could come back to haunt it.

Today vs. last month

Whole Foods' decision was first reported by Business Insider last week. Comparethe company'srecruitment website today to an archived version from August:

Why do it? One report says this will likely save Whole Foods $19 million a year. That happens to be roughly what Amazon founder and CEO Jeff Bezos reportedly makes in a little under five hours.

Actually the savings might be less, because Whole Foods told me in an emailed statement, it expects some affected workers to shift to full-time:

"Impacted Team Members in good standing have the opportunity to move into one of the thousands of full-time roles, where they will be eligible for the same Whole Foods Market healthcare plan at a more affordable rate.

The majority of Team Members only need to work an additional 5 hours per week to qualify for healthcare-eligible positions."

But picking up more hours means paying for childcare for some employees. One Whole Foods worker quoted byBusiness Insidersaid she was "in shock" after learning the news, adding:"I've worked here 15 years. This is why I keep the job -- because of my benefits."

Culture and perception

This might make some kind of sense as a financial decision. But as a culture and perception issue, it seems crazy.

Whole Foods has a great reputation for customer service. That's part of why it was worth $13.7 billion when Amazon acquired it in 2017. The way they've treated their employees historically was part of what made it all work.

I've shopped there forever, and the employees are a big reason why.But as we've seen so often -- heck, I even talked about it yesterday -- the hardest thing to build in any organization is culture. A close second might be the perception of culture.

Start chipping away at the pieces for short-term gain, and it can fall apart quickly.

Target du jour

Health care and how we pay for it is one of the most relevant, relatable and volatile political issues in this country today.

Besides, can you think of a company a clientele more urban andliberal than Whole Foods?

Heck, Whole Foods just managed to becomethe target du jour of politicians like Sen. Elizabeth Warren, Sen. Bernie Sanders, and Rep. Alexandria Ocasio-Cortez. It just seems like this decision could totally alienate some of its most loyalcustomers.

So, from the outside: If you truly need to cut costs, Whole Foods, I'd look somewhere else.

We all have our stories. I've been waiting for the chance to tell that one.

The opinions expressed here by Inc.com columnists are their own, not those of Inc.com.

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Whole Foods Just Announced a Surprising Change That Left an Employee 'In Shock' and Could Totally Alienate Their Most Loyal Customers - Inc.

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September 19th, 2019 at 6:41 am