[Editor’s note: The city of Berkeley is considering raising its minimum wage with an eye toward related policy changes in San Francisco. In his recommendation to the city’s Labor Commission, which has been studying the issue, Mayor Tom Bates asked the panel to consider setting special rules for tipped workers that could potentially grant an exception to the minimum wage for tipped workers. A final determination has not yet been made but, thus far in the discussions, commissioners have said they don’t believe tipped workers should be excluded from the new rules.]
In the midst of the debate over the proposed minimum wage increase in Berkeley, July 24 marked the fourth year that has passed since the federal minimum wage increased in 2009 to $7.25 per hour. The statewide minimum wage has stagnated at $8 per hour since 2008.
Today, millions of Americans find themselves struggling in poverty even while working a full-time job. The largest low-wage employer in the country, accounting for 39% of all workers earning at or below the minimum wage, is the restaurant industry. Restaurants make up a multi-billion dollar industry and one of the fastest growing sectors in today’s economy, yet workers are not seeing the benefits. In fact, seven of the ten lowest-paying jobs and the two absolute lowest paying jobs in the country are restaurant jobs.
In Alameda County, food prep workers earn a median wage of $9.19 per hour and waiters and waitresses earn a median wage of $9 per hour — meaning that the people who put food on tables of restaurant-goers struggle to feed themselves and their families. The benefits of a minimum wage increase to these low-wage workers are clear, yet in Berkeley now, many restaurant owners are advocating strongly to exclude tipped workers from the proposed minimum wage increase.
At the federal level, the tipped minimum wage is currently $2.13 an hour, which the National Restaurant Association has been successful in keeping in place since 1991. As the state with the largest restaurant industry in the nation, California has had no distinction between the tipped minimum wage and regular minimum wage for a quarter century. California is a stellar example of how we can pay equal wages to both tipped and non-tipped workers, while growing a robust and thriving restaurant industry.
Berkeley, as a beacon of progressive values, should not be the first city in the state to set a regressive precedent by subsidizing the low wages that restaurants want to pay their tipped workers. Instead, Berkeley should join the regional momentum and its neighbors, San Jose and San Francisco, which have minimum wages of $10 per hour and $10.55 per hour respectively, in setting a fair base wage for all workers.
A common myth is that increasing the minimum wage would destroy the restaurant industry. On the contrary, a study from UC Berkeley Institute for Research on Employment and Education found that the minimum wage increase in San Francisco did not create a detectable employment loss among restaurants. Other credible studies show that raising the minimum wage for tipped workers would improve productivity and decrease turnover rates, generating sustainable benefits to businesses.
Local restaurateurs also acknowledge these benefits. Nico Sanchez, owner of Platano in Berkeley, wrote on MomsRising.org, “Paying a living wage helps my business because the workers feel respected and don’t quit on me, leaving me scrambling for new workers. Also, when morale is high among my wait staff this is reflected in the satisfaction and generosity of the customers.”
After the minimum wage increased in San Jose in 2012, in an interview with local news channel KPIX, Nick Taptelis, owner of Philz Coffee, noted that as a result of good wages, “team members are actually happier, working harder, and actually giving better customer service, and from that the store actually got busier.”
Another common myth is that an increase in the minimum wage would drive food prices up astronomically. According to a recent report from the Food Labor Research Center at UC Berkeley, raising the federal minimum wage to $10.10 over the next three years based on the Fair Minimum Wage Act of 2013 would only increase the cost of food by at most 10 cents per day per U.S. household.
Moreover, a higher minimum wage would have an immediate impact on the livelihoods of restaurant workers. Kelly, a member of the Restaurant Opportunities Center of the Bay (ROC the Bay) and a Berkeley resident, laments that “the ability of my partner and I to keep the Internet, pay a phone bill on time, or buy food for ourselves and our pets relies on what tips I bring home. Tips cannot act in lieu of a fair minimum wage.”
Natasha, another ROC member, explains the downside of relying on fluctuating tips. “It is hard to secure a good relationship with a financial institution when your employment is not secure and direct deposits amount to only a few dollars an hour,” she said.
A higher minimum wage both in Berkeley and nationally would go a long way toward ensuring that all workers — from large restaurant corporations to small mom-and-pop shops — would have a secure base wage with which to feed their families, just as they feed us daily. It has been four years since the last federal minimum wage increase, and five years since the last statewide minimum wage increase. It is now time to lift the floor for all low-wage workers.
Op-Ed: As a restaurant owner I question minimum wage process (07.02.13)
Minimum wage ‘tip credit’ idea gets cold shoulder (06.21.13)
Berkeley considers city-wide minimum wage hike (06.18.13)
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