minimum wage
Think Tipping Is Out of Control? Watch This.TWO DOLLARS AND...
Think Tipping Is Out of Control? Watch This.
TWO DOLLARS AND THIRTEEN CENTS AN HOUR.
That’s how much millions of American workers are paid under the federal subminimum wage — which was set all the way back in 1991.
While many think tipping for services has gotten out of control, arguing over who deserves a tip and how much they should get distracts from what we should really be angry about: business models that depend on not paying workers a living wage.
It’s bad enough that the federal minimum wage is a measly $7.25 an hour. But employers are allowed to pay tipped workers just $2.13 an hour because supposedly the workers will be able to make up for it in tips.
Saru Jayaraman of One Fair Wage has been advocating to change this absurd and exploitative law. I asked her to share with us FOUR big reasons why we need to get rid of the subminimum wage and pay service workers a full living wage with tips on top.
Number 1: Workers who earn a subminimum wage often end up making less than the minimum wage
43 states currently allow certain workers to be paid a subminimum wage. Employers in these states are legally required to make up the difference if a worker’s combined wage and tips don’t reach the full minimum wage. But over a third of tipped workers report that their bosses regularly fail to do this.
That’s because enforcement of wage laws is lax, and it makes it easier for employers to get away with shortchanging staff.
Number 2: The subminimum wage perpetuates gender discrimination and harassment on the job
More than two-thirds of tipped workers — 70% — in the U.S. are women. And one in six women that work a tipped job are living in poverty — that’s nearly 2.5 times the rate for workers overall.
Since workers earning the subminimum wage are so dependent on tips to make a living, they are put in situations where they have to tolerate inappropriate customer behavior. A staggering 76 percent — that’s more than three-quarters of tipped workers — have reported experiencing sexual harassment on the job. And that only got worse during the pandemic.
Number 3: Tipping is actually a relic of slavery
Tipped workers are disproportionately people of color. And Black service workers in particular consistently earn less, including tips, than their white counterparts for doing the same job.
Look, this inequity of the subminimum wage is tied to America’s history of structural racism.
Following the Civil War, tipping was used as a racist solution by employers who didn’t want to pay formerly enslaved Black workers. So by allowing them to pay their workers just in tips rather than a wage, employers were able to avoid directly paying these workers.
Number 4: Paying workers a living wage plus tips is actually better for business — and our economy.
Corporate lobbyists, particularly for the restaurant industry, warn that paying workers a full minimum wage with tips on top will be devastating to businesses. But research shows these fears are completely overblown.
So far, seven states have replaced their subminimum wage for tipped workers with a higher minimum wage that still allows for tips on top. These seven states are actually faring better than the 43 states with subminimum wages for tipped workers — both in the number of restaurants and number of people employed by restaurants. And take home pay for restaurant servers and bartenders in these states was 24% higher than in states with a wage of just $2.13 an hour.
Workers at restaurants that have scrapped their subminimum wages in favor of higher minimum wages with tips on top are more productive, happier, and less likely to quit their jobs. This alone helps business owners cut employee turnover nearly in half. This is especially important following the pandemic, when restaurants are facing historic staffing shortages because over 1 million workers have left the industry due to low pay.
So not only have higher wage states been able to maintain their industries, but workers are more productive, getting paid more, and less likely to live in poverty.
And when workers have more money, they spend more money — stimulating their local economies in the process.
And for the first time in 30 years, workers are winning on this issue, like in DC and Chicago and a dozen other states.
The bottom line is that ending the subminimum wage for tipped workers is better for workers, it’s better for business, it’s better for our economy — and it’s the right thing to do.
Webbe says Hunt’s measures fatten the rich at poor’s expense – and Labour little better
Independent MP slams latest damaging Tory budget measures and assault on poor, sick and disabled
Leicester East MP Claudia Webbe has accused the Tory government of using Jeremy Hunt’s autumn statement to fatten business at the expense of the poor, of ‘snatching the assessment of illness out of the hands of doctors’ to punish the long-term sick and of doing the exact opposite of what the UK economy needs – and says that Keir Starmer’s Labour is little better in enthusiastically promoting the discredited austerity narrative.
In a statement issued today, Ms Webbe said:
Jeremy Hunt’s Autumn Statement boasted of giving corporations the biggest tax handout in modern British political history, doling out billions to companies – many of whom are already making obscene profits in a cost of greed emergency of soaring bills and food costs.
And he is doing this on the backs of the poor, sick and disabled, with horrendous measures to whip those who are unfit to work into taking jobs their medical experts have said they cannot do – and to do it they will snatch the assessment of illness out of the hands of doctors and have it decided by the government’s agents instead.
The past decade has seen a steep rise in poverty, with fourteen million people below the poverty line, including well over four million children. In Leicester East, four in every ten children were already living in absolute poverty – now the Chancellor says if people do not submit to his new regime to get them back into work, he will cut them off completely from support after six months. The effect of this on my constituents and the poor and sick across the country will be horrific.
This country, since 2010, has seen an appalling rise in the misery imposed on those who were already struggling to get by. More than four in ten disability benefit claimants have attempted suicide under the government’s brutal regime. Suicide has become the leading cause of death in men under fifty. Poor mental health abounds, yet the government has today shown it remains determined to punish and persecute those who cannot work – and indeed that it is determined to deny the reality of life in this country for so many.
In my constituency of Leicester East, we have seen endemic exploitation and poverty wages in our garment industry. I told the Chancellor in response to his Autumn Statement that the unionised manufacturing base of Leicester East has long been diminished – not replaced by technology, innovation and good modern jobs with decent pay, but by fast fashion, sweatshops and unscrupulous employers paying illegally-low wages. All this has been exploited by brands and retailers who are in a race to the bottom for ever-increasing profits while their supply chains fail to pay the minimum wage.
I asked him what action the government will take to regulate and ensure that brands and retailers are held to account for the sustainable outcomes of their products in their supply chains and wage justice for the people that make their goods, and to tackle those British brands and retailers who threaten to seek cheaper labour overseas so they can avoid paying the new minimum wage that the he had just announced. There was no meaningful response.
The government is using tweaks to the minimum wage – which it misnames the living wage – as cover for its handouts to business, but its increases are still very far below the level at which a person working one job could live on. The government claims work is the way out of poverty, but millions who are working are among the poorest.
Mr Hunt claims the government is going for growth, when in fact they are doing the exact opposite of what our economy needs – and hurting millions to do it. Economists recognise that the best way to boost economic growth is to give more money to the poor, because they have to spend it. But yet again the Conservatives are giving more to the rich and to corporations who will put much of it into offshore bank accounts where it does no good. As it is, despite his claims of growth he has had to acknowledge that the Office for Budget Responsibility is downgrading growth forecasts for the next three years.
And it has to be said that the Labour party is largely in agreement with the government it is supposed to oppose. This country needs politicians with the courage to speak the truth that the punishment of the poor to enrich the wealthy is a political choice and not a necessity or even productive. Sadly such politicians are at the moment in very short supply at the moment.
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The 2021 federal budget
I’ve written a ‘top 10’ overview of the recent federal budget. The link to the post is available here: https://nickfalvo.ca/ten-things-to-know-about-canadas-2021-federal-budget/