Poverty Rate Among Tipped Workers Double That of Regular Workforce
Following the first convening of Gov. Andrew Cuomo’s wage board on Monday, workers and advocates called for the elimination of the sub-minimum wage for New York State’s 230,000 tipped workers at a rally in New York City.
“I can’t live on $6.40 an hour, it’s that simple,” said Jose Sanchez, 32, a pizza deliveryman who has worked at a Domino’s in Washington Heights for four years. “Domino’s says that because we make tips, that’s enough. It never is, especially when they’re pocketing some of our wages in the process. Profitable chains like Domino’s pay us so little that we have to live on food stamps and Medicaid. The Wage Board can help fix that by getting rid of the sub-minimum wage.”
Employers in New York can still pay less than the minimum wage—just $5 an hour—to restaurant servers, delivery workers, and other service workers. While employers are legally required to “top off” a tipped worker’s pay when it falls short of the regular minimum wage, lax and disorganized enforcement enables employers to routinely violate minimum wage, overtime and other wage and hour laws with minimal repercussion.
“New York has a real opportunity to follow the lead of states like California, Minnesota, and Alaska in promoting fair pay for women and other low-wage workers by eliminating the tipped sub-minimum wage,” said Tsedeye Gebreselassie, senior staff attorney at the National Employment Law Project. “With the highest inequality in the country, it’s time for New York to adopt this common-sense policy and ensure that all tipped workers are at least paid the full minimum wage directly by their employers.”
A July report by the National Employment Law Project finds that eliminating the sub-minimum wage would benefit an estimated 229,000 tipped workers in New York. Service jobs are among the top-growth jobs in Western New York, the Southern Tier and Long Island. With women making up more than 70 percent of the tipped workforce, eliminating the sub-minimum wage would help address New York’s persistent gender pay gap, where women earn just 83 cents for every dollar that men make.
New York’s minimum wage is set to rise to $9 an hour by Dec 31, 2015, but the sub-minimum wage for thousands of tipped food service workers remains stuck at $5 an hour. The poverty rate among New York’s tipped workers is more than double that of the regular workforce. Seven states across the country that adopted policies requiring employers to pay tipped workers the full minimum wage and have shown that eliminating the sub-minimum wage reduces poverty without slowing job growth. Tipped workers are already being paid $9 or more in California, Washington and Oregon, and will soon be getting raises to over $9 in Minnesota, Hawaii and Alaska.
“The tide is turning,” said Tony Perlstein, Campaigns Co-Director of the Center for Popular Democracy. “Fast Food workers have demonstrated that they will do whatever it takes to make a fair wage. We call on Governor Cuomo and the wage board to lift up working families in the Empire State by eliminating the sub-minimum tipped wage.”
The New York City rally and Albany media availability were organized by Raise Up NY, fighting for #1FairWage, a coalition comprised of tipped workers, the National Employment Law Project, Make the Road New York, the Center for Popular Democracy, Fast Food Forward, New York Labor-Religion Coalition, New York Communities for Change, ROC-NY, ROC-NY affiliate of Restaurant Opportunities Centers (ROC) United, Strong for All, United New York, Citizen Action NY, and other community groups and advocates.
Voices from the Coalition
Carolina Portillo, member of ROC-NY and server:
“Tips just don’t add up, and relying on my customers’ generosity to pay my bills exposes me to unwanted sexual harassment. I hope the wage board and Governor Cuomo do the right thing and eliminate the sub-minimum wage.”
Hugette Toussaint, a 38-year old tipped worker in the service industry:
“The Wage Board needs to know that the tipped minimum wage is not fair. It’s not enough for us to eat or pay the bills or afford daycare. After taxes, our checks end up being nothing. Since were living off tips, we’re always worried about ending up homeless because we can’t pay our bills.”
Karen Scharff, Executive Director of Citizen Action of New York:
“An astounding number of restaurant workers—one in three—can’t afford to feed their families. New York can immediately address this inequality through the Wage Board process by eliminating the sub-minimum wage. People who work hard every day should be able to afford the basics.”
Michael Kink, Executive Director of the Strong Economy For All Coalition:
“Governor Cuomo has a real opportunity to boost wages for thousands and thousands of New York’s lowest-paid and hardest-pressed workers. The Wage Board can and should eliminate the tipped minimum wage—it would boost paychecks and really help revive our local economies everywhere in the state.”
Refugio Denicia, a member of Make the Road New York and the Retail, Wholesale, and Department Store Union, who works at Off Broadway Car Wash:
“The manager used to steal tips from the workers before we had a union contract. As a father of two children, I can tell you that it’s very difficult to pay the rent and support a family earning less than the full minimum wage plus tips. All workers should earn the same minimum wage, and that the Wage Board should do away with the sub-minimum wage for all tipped workers.”
Claudia Leon, member of Make the Road New York from Queens who worked as a waitress:
“It was impossible to raise my three children depending on tips and never knowing how much money I would take home at the end of the day. I’m glad the Wage Board has the opportunity to address income inequality in New York. All workers in New York deserve a raise, including tipped workers.”
Juan Alonso, owner of Taqueria Izucar in Bushwick, Brooklyn, and member of Small Business United, a project of Make the Road New York:
“As a small business, we take care of all our books ourselves. Tracking two different minimum wages for tipped and non-tipped workers takes time that we simply don’t have. I would rather pay all workers the same minimum wage.”
Ashley Ogogor, current tipped worker, 2 years in restaurant industry:
“There shouldn’t be a tipped minimum wage because you’re never really guaranteed if you’re going to get a tip, regardless of how great your service was, customers leave whatever they want or have. It’s like a gamble every night. Even when you’re working hard every single night. you’re not guaranteed the salary that you need to get by.”