Yeah, I’ve read about no-tipping places where customers get angry at not being allowed to tip.
Yes. Do away with the tipped minimum. Prices will increase everywhere, servers will get decent wages, lots of people will stop tipping. If some people still tip during the transition, or forever, fine. I don’t begrudge the servers some extra income.
please excuse my ignorance as a non-American, but why are employers allowed to pay as little as that to their staff? With all the regular bs you have to put up with in any service industry, plus the new and dangerous depths of bs this survey shows, I’m a little shocked people rely so heavily on tips for income.
Because the federal, and most state, minimum wage laws have a proviso called the tipped minimum wage.
Any worker who derives a “significant amount” of their income from tips, may be classified as a tipped worker. Which are subject to a much lower minimum wage.
Federally it’s just $2.13 an hour, and $30 per month is the very low bar for " significant amount" of income as tips.
Some States have higher minimum wage laws than the Federal standard. All but a few maintain the tipped minimum catagory.
Technically if you get little enough in tips to fall below the full minimum wage, State or Federal depending on where you are, your employer must make up the difference. But enforcement is practically nil on that.
Tipped workers are also usually excepted from overtime and sick time rules among other important labor protections.
What it boils down to is that when the minimum wage was created the Hotel and Resort industry lobbied hard to be excepted from it. Using arguments we still hear today about all that tax free tip money the sinister wait staff are making. Highlighting the handful of service workers who made the most.
As most tipped hospitality workers at the time were black, it was a fairly easy trade off to make to get a minimum wage in place.
On top of that our minimum wage laws, particularly Federally, have lagged badly. Minimum wage in most states puts you below the poverty line. And the habit has been to not keep the tipped minimum locked to the minimum proportionally. Tends to either not get raised or get raised less. So it’s fallen even further behind.
In the vast majority of states a tipped worker will never actually be paid a cent by their employer. All of that money will go direct to taxes and tips will represent 100% of take home pay.
I still have a few zero dollar pay checks I kept just to prove it’s a thing.
Insult to injury employers save a significant amount on payroll taxes by employing tipped workers. Some states even offer a tax credit for each tipped employee.