AMC Theaters CEO Calls Obamacare Delays 'Troublesome'

9:20 AM PST 03/26/2014 by Pamela McClintock
Eric Charbonneau/Invision for Open Road Films/AP Images
Gerry Lopez

Theaters across the country have begun changing the way they do business because of the Affordable Care Act, even though key provisions have been delayed.

LAS VEGAS -- As far as AMC Entertainment CEO Gerry Lopez is concerned, the continued delays in the rollout of the Affordable Care Act are "annoying."

"It introduces a level of uncertainty that is troublesome, and has no right to be introduced," Lopez told The Hollywood Reporter in an interview Tuesday in Las Vegas, where theater owners are holding their annual convention, CinemaCon. "The damn law just keeps changing. Make up your mind."

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Theater circuits, like other service industries, rely heavily on part-time workers, and thus face rising costs and substantial changes in the way they manage their employee ranks because of Obamacare. Perhaps the biggest issue facing exhibitors is a provision that declares an employee is full time if they work 30 hours a week, versus the historic 40 hours. Employers will have to offer affordable health insurance to all full-time workers.

The 30-hour rule was delayed, but takes effect next year for any company with more than 100 employees. "It's the big gorilla in the room," said Steve Gooding of Reynolds & Reynolds, an employee benefits firm that hosted a seminar at CinemaCon Wednesday morning.

In 2016, smaller companies with 50 to 99 employees will also have to begin offering affordable health insurance to full-time workers.

The National Association of Theatre Owners is part of a broad coalition urging Congress to overturn that provision and restore the full-time threshold to 40 hours.

Obamacare also requires employers to provide detailed records on its health plans and number of employees.

"It's a very onerous project," Gooding said. "And there can be substantial penalties if you don't do it."

Many exhibitors, including AMC, have already begun implementing those systems.

"It's already changed our work environment," Lopez said.

Lopez insists no one has been let go because of Obamacare. The exhibitor has some 20,000 employees.

AMC is the second-largest circuit in the U.S. behind Regal Entertainment. Last year, there were reports that Regal had laid off some workers because of Obamacare.

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