What is the “Living Wage” that Waitstaff Should Be Paid If We Outlaw Tipping?
Jillian Melton and Paul Sklar work at two restaurants hundreds of miles apart. And when it comes to the $15 minimum wage debate, their differences in views could almost be as vast.
The push by Democrats to raise the federal minimum wage would also eliminate a decades-long practice of paying restaurant servers as little as $2.13 an hour under the expectation they would earn far more through tips.
It is a pay structure prevalent in most states, including in Tennessee, where Melton was a server at the chain restaurant Seasons 52 until she was laid off during the pandemic. But for Melton, that reliance on tips was "archaic," often meaning the difference between spending more time with her children, or having to work a last-minute shift.
"I've missed track meets," Melton says. "I've missed baseball games because I needed to work, even though I planned to be off tonight, because yesterday went so terrible."
But Paul Sklar, a server at an Olive Garden in Baltimore, doesn't want the tip wage system to change. He worries restaurants would have to cut hours or lay people off if they were forced to pay more to their staff out of pocket.
"If they have one slow day or one bad weekend, they're ready to cut hours, make tough decisions with some of their most loyal people, so I can only imagine what having to pay a much higher wage would do," Sklar says.
Although servers make far less than the standard federal minimum wage of $7.25 an hour, restaurants are legally supposed to pay the difference when those employees' pay falls short of that amount.
But servers complain many restaurants often skimp on topping off their pay if they don't make enough in tips.
The tipped wage structure is a relic of the Jim Crow era, when businesses looked for ways to avoid paying a full wage to African Americans and women.
People of color and women today make up a huge chunk of the tipped workforce, and discrimination and sexism persist, affecting servers such as Melton.
The most recent Democratic proposal to hike the minimum wage would scrap this two-tiered system. Businesses would have to pay every worker at least $15 an hour, whether they make tips or not.
Forecasters from the Congressional Budget Officesay boosting the minimum wage to $15 an hour would deliver a pay raise to as many as 27 million Americans, but they caution it would also cost as many as 1.4 million jobs.