By TAYLOR
FARNSWORTH
Opinions Editor
The fifth proposal of the 2018 State of the State, the elimination of the tip credit, is causing serious concern among restaurant workers. The comfortability of flexible hours and quick cash, along with packed restaurants during the weekends, may come to a halt if New York State decides to get rid of the tip credit.
The tip credit allows restaurant workers to receive a lower minimum wage than that of non-tipped workers within the state. The assumption being that the overall tips earned by the individual worker is meant to make up for the difference of having not been paid full minimum wage by his or her employer. If the state minimum wage is not made up for by tips then the law requires the employer to cover the difference. This rarely happens.
As minimum wage is slowly increasing as promised by Andrew Cuomo, governor of New York State, as part of his $15 state minimum wage advocacy, restaurant workers are fearful of their financial situations. Aside from Nassau, Suffolk and Westchester counties, the beginning of this year the minimum wage increased in New York State from $9.70 an hour to $10.40; and in December of 2015, the hourly wage for tipped workers rose from $5 an hour to $7.50. As a result of the minimum wage increase for restaurant workers, data from the Census Bureau showed that New York State alone lost over 500 restaurants in 2016.
Just like every state has its own set minimum wage, every state has the ability to have its own tip credit as well. Some states do not have a tip credit in place: Alaska, California, Minnesota, Montana, Nevada, and Washington. Last year, voters in Maine choose to eliminate the tip credit, but due to complaints from the restaurant industry, Maine’s legislature quickly voted to restore it.
It is “a question of basic fairness,” said Governor Cuomo, but nothing about this proposal appears to be very fair.
Tips are based upon quality of service. The elimination of the tip credit thus means more work for less pay due to restaurant’s no longer being able to afford hiring new staff and scheduling adequately for busier shifts. Servers will take on more tables at once due to potentially being understaffed resulting in a lesser quality of service for the guests.
As it currently stands servers appear eager to upsell, pre-bus, provide silent refills, and cater to every request at the hand of their patron. I am not suggesting servers will care less about catering to the guests without a tip credit in place, however the ability to do so to the current standard may no longer be practical.
Guest satisfaction is the ultimate goal for restaurants. It is that satisfaction with both the food and service that brings the customers back, but often we neglect to factor in those whose responsibility it is to have those same guests leave satisfied. Those workers are earning a living based upon an income that comes primarily from the pocket of his or her customers and not in the form of a weekly paycheck by an employer.
The elimination of the tip credit will not only result in restaurants becoming understaffed and a drastic cut to weekly hours for its employees, but customers will see a change in menu prices. In order to make up for the money now being taken from the restaurants to pay its employees, the menu prices will gradually increase to cover the new cost, which may result in customers not going out to eat as often as he or she would like due to it no longer being feasible.
Customers may also be less likely to tip the server based upon overall experience because the guests are now under the impression that the worker is making enough in his or her paycheck to make ends meet and therefore a tip is no longer required. This is a false presumption as a majority of restaurant workers make far more than minimum wage in any given shift and adjust his or her lifestyle accordingly to accommodate to that presumed wage.
According to a Forbes magazine article, “A New York City Hospitality Alliance survey of 486 city restaurants, which employ nearly 14,000 tipped workers found that those servers earn on average, $25 per hour,” more than double the current minimum wage in New York State.
Governor Cuomo’s fight to eliminate the tip credit appears to be largely based upon a fear of discrimination. In a 2014 survey conducted by Restaurant Opportunities Center (ROC) United, a nonprofit organization that advocates for low-paid workers, said 80 percent of women reported having been sexually harassed by their co-workers. It also found that workers in a state that require the full minimum wage paid to tipped workers experienced nearly half the amount of sexual harassment than those working in states that have a tip credit.
In a 2013 study conducted by Michael Lynn, a Cornell professor, he found that white servers were tipped more than African-American servers regardless of the service that was provided. In a previous study in 2000, he also found that attractive women appeared to be tipped more than less attractive women and men in general.
“In New York, we believe in a fair day’s pay for a fair day’s work and that all workers deserve to be treated with dignity and respect,” said Governor Cuomo in regards to eliminating the tip credit.
No one is advocating for inequality or discrimination. Restaurant workers are simply pleading to be heard as their financial circumstances may be hindered based upon a decision to eliminate a credit that helps support themselves and their families present lifestyle. Eliminating the tip credit won’t prevent sexual harassment by those too foolish to know how to behave in a professional manner. Eliminating the tip credit won’t put an end to racist rhetoric or discriminatory actions. But it will cause disarray to those working in the restaurant industry as they scramble to find new avenues for extra cash just to get by.
