With Minimum Wage Proposal, Tipped Workers Might Get a Small Boost

In his State of the Union address this week, President Barack Obama called on local lawmakers around the country to raise minimum wages. The Massachusetts Senate is way ahead of him. It passed a bill in November that would push the state wage from $8 to $11 dollars an hour by 2016. But there’s one group who, on paper at least, make far less than that: people like servers and bartenders who rely on tips.

Minimum Wages and Tipped Minimum Wages in New England States

Source: U.S. Department of Labor

Elizabeth Adams has worked at the Route 9 Diner in Hadley for four and a half years. She’s also a recent UMass graduate. She makes $2.63 an hour.

“My general check is around $20, it could be $30 depending on how many hours I work. I generally work about 30-40 hours a week,” Adams says.

But that’s not including tips. Adams says even if there are slow days, over a week, she’s making about 500 bucks, with just that $20 or $30 coming in her paycheck, and the rest in tips. The benefit of that?

“It’s instant cash,” Adams says, “so if I have to pay for something quickly, I can get it if I know I’m working, I know I have that. On the other hand, there is that uncertainty if it’s not busy, the luck of the draw with customers. It is all based on the tradition of tipping.”

For servers like Adams, the minimum wage has been $2.63 an hour since 1999. The bill passed by the senate would more than double that to $5.50 an hour by 2016. By law, employers of tipped workers are supposed to make up the difference if an employee’s total pay doesn’t add up to the regular minimum wage. Adams says it’s never come to that for her. She says she would welcome a boost to her paycheck. But both she and Brian DiPippo, a bartender at the Moan and Dove in Amherst, have mixed feelings about the extra money.

Rt9Diner2“I would love to actually be able to make more money, but I am sympathetic towards some of the small businesses that would be greatly affected by having to pay double or more,” says DiPippo.

Those sympathies are probably heartening to the Massachusetts Restaurant Association, which has staked out a position in a predictable fight over the pending wage legislation.

Mansour Ghalibaf is board chair of the restaurant association, and owner of the Hotel Northampton. Ghalibaf argues that if restaurant owners have to pay higher wages to their employees, they’ll need to raise prices, which will drive down the number of customers.

“If the customer is less, of course everybody is going to make less money. Their wage will go a little higher, but their tip, which is basically that’s what they are there for, to make the tip, it is going to be less because of lack of customers,” says Ghalibaf. “So it is that type of catch-22 in a way.”

“Customers will have extra money in their pocket to get the dessert that they’re not ordering now, or for some customers, they’ll eat out an extra night when they would stay home,” counters Steve Crawford, spokesman for a group called Raise Up Massachusetts.

The union-backed group gathered signatures to put a minimum wage increase, including for tipped workers, on this year’s ballot. Raise up Massachusetts wants to put the tipped wage slightly higher than the Senate’s proposal. Crawford says the group even discussed eliminating the separate pay scale all together, but chose to stick with tradition.

“We thought this was the most viable proposal to get more money into the pockets of everybody,” says Crawford.

Even the restaurant association is in favor of some sort of a wage boost. But the group’s Mansour Ghalibaf says it should be raised at a slower rate. He notes that waiters and waitresses already make more than minimum wage, and he’s right. According to the federal Bureau of Labor Statistics, servers in Massachusetts make an average of $13.13 an hour, and bartenders make $12.74.

Regardless of the outcome of this debate, a big portion of servers and bartenders’ pay will still be up to the judgment of customers. Elizabeth Adams at the Route 9 diner says working for a positive judgment can be physically and emotionally exhausting.

“You have to put up a face of being always friendly, always obliging, always engaging with your customers,” says Adams. “And you do run into people who are not so happy or not in a good mood, and kind of take it out on you.”

Over at the Moan and Dove bar, Brian DiPippo says even if he had the choice not to rely on tips, he’s not sure he’d take it.

“It kind of keeps you honest. You’ve always got to remember, since it is so much of your income, you’ve got to make sure you’re doing a good job,” says DiPippo. “But I would be able to relax a little more.”

Just how much DiPippo will be able to relax is now up to lawmakers in the Massachusetts House. But regardless, servers and bartenders will still have to put on that smile, stay honest, and keep pushing for those tips.