Democrats seek to repeal tipped minimum wage for restaurant workers

NOW: Democrats seek to repeal tipped minimum wage for restaurant workers

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MADISON, Wis. (CBS 58) -- Those who work in the restaurant industry could see a higher hourly wage under a proposal introduced by two Democratic lawmakers.

Rep. Francesca Hong (D-Madison), a restaurant owner, and Sen. Chris Larson (D-Milwaukee) introduced the bill which would eliminate the $2.33 hourly wage tipped workers currently make and raise it to the state’s minimum wage, $7.25 per hour.

Some restaurants already pay their tipped staff more than the sub-minimum wage, but Hong said all restaurant workers deserve a high standard of living.

“Every single position in a restaurant has value, so it’s important we continue to see owners working towards a greater vision for restaurants who have equitable pay structures,” said Hong during a virtual press conference.

The bill would require restaurant owners to pay the minimum wage, $7.25 per hour, to all employees who receive tips.

Josh Berkson, a Madison restaurant owner, shifted his pay structure once the pandemic hit, for all his employees to make above the minimum wage.

He said once his restaurants Merchant and Lucille downtown shifted to carryout and deliver only, he noticed all of his staff were putting in the same amount of work, as oftentimes servers make more money than hosts and dishwashers.

“If there’s no such thing as departments and we are all (serving) customers, then the tip credit has no value at all,” said Berkson.

Higher wages could cause employees to earn less than they currently do, said the Wisconsin Restaurant Association (WRA).

“If the tip credit is eliminated, many restaurants would terminate tipping, raise prices to cover higher wages, and move to an hourly, wage-only system,” said Susan Quam, vice president of WRA.

“The tip credit system incentivizes servers to deliver excellent service, enables customers to reward servers for great service, and allows restaurants to keep labor costs in check,” Quam added.

Other states have attempted to repeal the hourly tip wage in Chicago, Maryland, Michigan, Maine, New Mexico, Virginia, and Washington D.C., according to Quam, but noted many workers spoke out in opposition.

Larissa Joanna, a server in Madison and member of the Restaurant Workers Coalition, argues a higher wage is even more important now, as the pandemic has created uncertainty in how much waitstaff makes throughout the week.

“The sub-minimum wage is dehumanizing for a lot of workers going out of their way, risking their lives during this pandemic,” Joanna said.

The bill wouldn’t eliminate tips or interfere with how they should be distributed.

The proposal comes as the federal government is considering an increase of the minimum wage to $15 per hour, a move widely opposed by Republicans.

“My preference would be that if we are looking to get more money in the pockets of tipped employees, we do it by taxing them less, rather than making sure big government gets more,” said Senator Andre Jacque (R- DePere).

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