Obamacare Costs
After announcing the policy last week, Armstrong appeared on the CNBC cable network, where he blamed President Barack Obama’s health-care law for forcing cutbacks. Obamacare added $7.1 million in expenses for AOL, he said. Other companies––including United Parcel Services Inc., the fourth-largest employer in the U.S.––also have cited the law for cuts.
In a meeting with employees, Armstrong said the health-care expenses of two workers in 2012 played a role in his decision on which benefits to cut, Capital New York reported last week. The two employees had “distressed babies that were born,” costing AOL $1 million each, he said, indicating that he’d rather give priority to health care over retirement among the company’s benefits.
In his memo over the weekend, Armstrong said he shouldn’t have discussed specific health-care examples at a meeting with employees.
‘Cruel Violation’
Fei, the mother of one of the infants, wrote on Slate.com that her daughter weighed 1 pound 9 ounces when born by emergency cesarean section in October 2012, just five months into an otherwise routine pregnancy. The girl spent three months in a neonatal intensive-care unit.
Even now that her daughter is home and healthy, Fei wrote that she can’t take the girl’s presence for granted. “All of which made the implication from Armstrong that the saving of her life was an extravagant option, an oversize burden on the company bottom line, feel like a cruel violation, no less brutal for the ludicrousness of his contention,” wrote Fei, a novelist whose husband is an editor at AOL.
When Armstrong was a vice president of national sales for Google in July 2005, employee Christina Elwell sued him and the company in federal court in New York for job discrimination under civil rights law, according to court records.
‘HR Nightmare’
In the lawsuit, Elwell contends that after she became pregnant with quadruplets, three of whom she lost, Armstrong demoted her from national sales director to an operations position, according to the complaint.