Did The Wage Board Just Boost Tipped Workers, Or Crush Them?

February 2, 2015
By Joe Maniscalco

Tipped workers have many reasons to jeer the sub-minimum wage.

Tipped workers have many reasons to jeer the sub-minimum wage.

New York, NY – Governor Cuomo’s Wage Board has finally issued its recommendations – but they may not be the remedy tipped workers around the state earning less than the minimum wage have been fighting for. 

Advocates for struggling, and often abused tipped workers, are applauding four of the Wage Board’s recommendations because they could pave the way to establishing one fair wage for all workers. 

After nearly six months of deliberations, the three-member board is recommending New York State do the following: consolidate various restaurant and hospitality tipped worker categories into a single category; raise the tipped minimum wage for restaurant and hospitality tipped workers to $7.50 an hour, while raising New York City’s tipped minimum wage to $8.50 an hour should the legislature raise the city’s minimum wage – and finally, consider elimination of the sub-minimum wage for tipped workers, and guarantee everyone the full minimum wage. 

Seven states have already successfully scrapped the sub-minimum wage for tipped workers. New York's sub-minimum wage for its approximatley 400,000 tipped workers presently stands at  $4.90 an hour. 

The Restaurant Opportunities Center [ROC-United] is calling the four recommendations an “Important step forward for working New Yorkers,” while Make the Road New York [MRNY] is welcoming them as “long overdue.” 

“Overall, the board's proposals represent progress, and to a degree we think wouldn't have been possible without ROC and the #1FairWage coalition calling for an elimination of the lower, tipped minimum wage altogether,” Maria Myotte, National Communications Coordinator, ROC, told LaborPress in an email. 

That said, worker advocates insist that the Wage Board’s fifth recommendation to actually try and penalize tipped employees who work hard, and earn more than 120 percent of the full minimum wage, undermines whatever other gains the Wage Board proposes. 

The Wage Board’s final recommendation allows employers to claim a “$1 tip credit” and continue paying their workers a sub-standard tipped minimum wage if they can demonstrate that staffers make more than 120 percent of the full minimum wage – or 150 percent of the full wage in NYC. 

“This final recommendation is without precedent nationally and undermines the Board's other recommendations,” MRNY said in a statement. “It is nothing more than a subsidy to more profitable restaurant employers; would be extraordinarily difficult to enforce, and by imposing this lower sub-minimum wage for workers of these employers, guts the Board's other recommendations to increase the tipped minimum wage to $7.50 per hour (and $8.50 in NYC) and would continue to keep tens of thousands of tipped workers in New York State in poverty.”

Governor Cuomo, who along with Labor Commissioner Mario J. Musolino, has the authority to alter the Wage Board recommendations. Cuomo previously had argued against allowing NYC to set it own minimum wage because he felt it would prove to be too complicated. And he is also on record saying that the sub-minimum wage for tipped workers is too low.

“The fifth proposal, the $1 tip credit, is very troubling,” Myotte told LaborPress. “It's unprecedented, and would essentially undermine the board's first 4 proposals to increase the wage and simplify the tipping system. We're hoping that Cuomo and Musolino reject the $1 tip credit, and take steps to implement the first 4 proposals.”

The existing sub-minimum for tipped workers especially hurts women who are more than twice as likely to be in poverty as those in the overall workforce. Women forced to rely on tips to make ends meet also continue to be vulnerable to abusive customers


February 2, 2015

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