While some businesses are moving many employees from full-time to part-time status to avoid the health insurance mandate of the Affordable Care Act, Cumberland Farms is taking the opposite approach.
The Cumberland Gulf Group, an affiliate of Gulf Oil, announced on Monday that it was converting 35 percent of its part-time employees to full-time status, to enhance their benefit package and the company's ability to recruit the best talent.
Approximately 1,500 of the 4,200 part-time Cumberland Farms employees nationally will be given the opportunity to convert to full-time status, effective Oct. 1, according to John McMahon, senior vice president and chief human resources officer at Cumberland Gulf Group in Framingham, Mass.
"This is a great opportunity for us to put our money where our mouth is," McMahon said. "We are walking the walk about being a people-oriented organization."
Cumberland Farms, which operates primarily in the eastern United States and Florida, owns roughly 600 retail stores and gas stations, as well as petroleum and grocery distribution operations in 11 states.
The company employs 452 in New Hampshire, with only 171 in full-time status. The remaining 281 are part-time and will be eligible to have their hours extended. The ACA considers an average 30 hours a week or more of work as full-time status.
McMahon would not disclose how much Cumberland Farms is spending to accommodate the shift in the workforce, but said it was in the millions of dollars. The company's fiscal year beings on Oct. 1, which is why the switch-overs are scheduled to begin at that time.
Most remaining provisions of the ACA, including the employer mandate, take effect on Jan. 1, 2014.
"We decided to implement our plan early," said Air Haseotes, president and CEO of Cumberland Farms. "Investing in our employees is not just a smart thing to do; it's the right thing to do."
Employees will be given the opportunity to apply for the additional hours, and decisions will be made store-by-store on the basis of employee merit and store scheduling needs, said McMahon.
"We're going to be working with store managers over the next three months," he added. "They understand their people, who's interested in working more hours and who have been good performers. We'll be able to move them up into the higher number of hours."
Under the "play or pay" provision of the ACA, businesses that employ 50 or more full-time equivalents must offer medical insurance to those employees or pay a penalty of $2,000 per employee. Many employers that use a large number of part-time employees, including restaurants and convenience stores, are scheduling employees for less than 30 hours a week to avoid the requirement.
"This is consistent with our whole strategy of making Cumberland Farms a great place to work," McMahon said. "If we're going to have the best people, we're going to have to offer them something that's very compelling."