Starting December 31, 2015, the New York State Department of Labor will put into action Governor Cuomo’s proposal to raise wage for tipped workers to $7.50 an almost 50 percent raise from the current $5.00 minimum wage. “New York has become a state of opportunity in the past four years – but we must do more to ensure that opportunity is available to all workers, and the State Department of Labor’s decision to raise the minimum wage for tipped workers is an important step toward making that happen,” Governor Cuomo said at a press conference on Feb. 24.
Tips added to employees’ base salaries must equal minimum wage; however, that does not seem to be an issue for some employees in Ithaca.
“I make about $50 an hour when I’m bartending right now so that’s more than minimum wage can ever even come close to,” Beriont said.
“[Servers] generally make over $30 an hour on average,” Ursula Kurman, owner of the local restaurant Viva Taqueria and Cantina, said. With hourly wage and claimed tips combined, she thinks her employees are paid very well,
With $5.00 an hour wages, tips are significant for these workers. “I do count on that paycheck every week but that’s something I put in the bank and only spend when necessary and I kind of live day to day with my tips,” said Guthrie Noonan, manager of Loco Cantina in College Town.
It is common practice for servers to not declare their cash tips, which means they are not taxed on this money, whereas tips put on credit cards are automatically declared. “Much of tipping is under the table – not at Viva because we make servers claim tips, but in general it is a huge underground economy, evading payroll taxes and income taxes,” Kurman said.
Raising the wage a dollar or two for many of these workers does not seem to have that much of an effect because of their heavy reliance on tips. “That two dollars extra, to me, isn’t a huge thing. I don’t think it’s really creating a living wage anymore than the $5 an hour,” Kristen McGinnis, server at Joe’s Restaurant, said.
The Wage Board within the state’s Department of Labor plans to review the system of cash wages and tip credits and will discuss whether this practice should be eliminated altogether. Kurman is on board with this idea.
“Having tips be a large part of a workers income demeans the quality of their job,” Kurman said. It not only makes them more susceptible to sexual harassment, but Kurman adds, “working for tips encourages servers to give food or drinks away and do things to increase their tips that don’t necessarily benefit the restaurant.”
Because tips are the majority of servers’ already low wages- some states have wages as low as $2.13 an hour, servers do not often object to what they feel will bring in the highest tip, according to the Restaurant Opportunities Centers United, who said in a press release that 90 percent of female restaurant workers experience some form of sexual harassment.
This rise in wage for tipped workers to $7.50 an hour will still be less than the state’s minimum wage, which will increase to $9.00 by December 31, 2015.
