Minimum wage tip cap returns to Capitol

Though it didn’t come up much in last fall’s campaign, the minimum wage issue is back at the Capitol in Saint Paul where a Republican lawmaker is carrying a restaurant-industry-written bill to trim the minimum wage increase for servers.

The bill, from Rep. Pat Garofolo, R-Farmington, caps the minimum wage at $8 an hour, the amount it went to last August.

It would apply only if workers earned a total of at least $12 an hour on a two-week average with tips factored in. If they don’t they get the minimum wage.

Restaurant lobbyists say without the bill, iPads could replace servers or restaurants could switch to fast-food joints that minimize the need for wait stuff.

How bad is a higher wage hurting restaurants? The Star Tribune says not much:

Though restaurant operators warn that the higher minimum wage will result in the loss of jobs, evidence from the Minnesota Department of Employment and Economic Development undercuts the claim. Since August, when the minimum wage floor rose to $8 an hour, the food and accommodations industry added 3,700 jobs, according to DEED employment data.

Likewise, the Pioneer Press trots out the numbers to suggest things are OK in the business.

The Minnesota Department of Employment and Economic Development reported in the first quarter of 2014 that the median pay in wages and tips for the state’s 48,000 servers was $8.68 per hour. Ninety percent earned less than $11.93 per hour.

According to a 2013 survey by the Minnesota Restaurant Association, wages and tips for servers averaged $22 per hour in the Twin Cities metro area and $18 statewide.

And yet, the Pioneer Press noted, restaurant owners sang the blues at a hearing yesterday when a committee passed the bill on a party-line vote.

But Tim Mahoney, owner of the Loon Cafe and J.D. Hoyt’s in Minneapolis, gave an example of the labor costs involved for business owners.

He brought in pay records for one of his waitresses for the first two weeks of February, one of the slowest times of the year. She made $21.38 per hour in tips, he said, plus the minimum wage.

“We’re not all millionaires. We work damn hard,” Mahoney said of restaurant owners.

“It’s a real big deal,” said Bryan Turtle of Turtle’s Bar and Grill in Shakopee. “Our hands are tied. The only thing we can do is raise prices.”

Keith Olson of Keith’s Kettle in Clearwater said that with the raises for serving staff, there’s not enough money to treat cooks and other staff fairly. The system Garofalo lays out is better, Olson said, because “it doesn’t put as much pressure on the entire restaurant.”

The measure isn’t given much of a chance if it reaches the Senate.

  • Jack

    This is a record-keeping nightmare waiting to happen. Who gets to pick the two week period that the average will be computed on? Will the company be forced to pick the same two week period for all employees? Or will they be allowed to cherry-pick so that they can find some two week period when each employee is below the threshold?

    How often will the average have to be recomputed? Is it a permanent reduction to the $8 an hour?

    I vote for doing away with tipping and just paying a reasonable wage.

    I need to remind my college student child that he better be tipping a decent amount when he eats out as someone’s job could be dependent on it in the future. Thanks for the reminder.

    • Great idea, doing away with “optional” tipping. I wonder how owners and patrons would feel about an across the board 18% increase in food costs with information saying, “In recognition that it takes an entire team to provide quality service to our patrons and transparency in our compensation plan, we have increased our prices across the board by 18% with the entire amount going equally to our staff in the form of a livable wage. We ask that you not leave any additional tip as it suggests that one of the team members serving you today is more important than any other. Your dining cost is the same as it always was. If you were dissatisfied with any part of your dining experience, please contact our manager, who will promptly discount your meal by no less than 18%.

  • Ron Fresquez

    I agree with Jack. Pay a livable wage and if the customer wants to leave a tip they should be allowed to do so.

    • Tim

      Indeed, this is what other countries do, and it seems to work just fine. Somehow they all manage to still have restaurants.

      • Ron Fresquez

        The majority of the restaurant industry has grown accustomed to cheap, disposable labor. Most diners don’t mind paying more so wait staff can earn a livable wage or as close to livable wage. If I dine at an establishment that pays its wait staff a livable wage I also want the option to leave a tip for the exceptional service if warranted.

        • Jack

          Nothing would stop you from leaving a tip. As someone who used to live in a “no tipping” country, I still left a tip if service was great.

  • Jack Ungerleider

    While I think its a lousy way to legislate I sometimes wish we had and Initiative and Referendum system in Minnesota. I’d love to get the following on the ballot:
    Effective with the start of the next Legislative session (Year to be included when item is on the ballot) Legislative pay would work as follows: Legislators will be paid $10 each day they report to the chamber to which they are elected. Upon completion of the session voters in a legislator’s district will determine the legislator’s remaining salary with a vote. Options will be to pay the legislator 100%, 75%, 50%, 25% or none of their remaining $30,000 salary.

    That way the voters in each district could decide if they got service worthy of payment.

    • Nick K

      We have this system, but instead of deciding how much to pay them, we decide whether to fire them or not.

  • Jim in RF

    If the MRA’s worst-case scenario is a server working full-time pulls down $42,760 before taxes and healthcare, they’ve lost. What kind of world is it where someone working full-time can’t afford to have a family?

  • >>“It’s a real big deal,” said Bryan Turtle of Turtle’s Bar and Grill in Shakopee. “Our hands are tied. The only thing we can do is raise prices.”<<

    Then f*cking raise the prices. I have no problem paying an extra 50 cents for a burger if it means the server can get a decent wage.

    • Kassie

      Right. This was the whole thing with Papa Johns and the Affordable Care Act too. Saying that price of pizza will go up if they have to insure their staff. Great! I’ll pay 50 cents more for a pizza if it means thousands of people will get insurance.

      • Jeff

        Agreed, it’s sort of the point of the minimum wage – everyone has to raise their prices. There’s no competitive disadvantage that way.

      • Of course Papa John’s doesn’t actually make “pizza.”

  • Postal Customer

    Has Pat Garofalo ever done anything that does not in some way benefit Pat Garofalo?