Minimum Wage for Tipped Workers Could Rise in Upcoming Years
Boston, MA– A bill has been proposed that would gradually raise the sub-minimum wage for tipped workers in Massachusetts until their pay is equal to the state minimum wage.
Last year, Governor Charlie Baker signed legislation to gradually raise the minimum wage for all workers in Massachusetts to $15 by 2023. This includes a hike for tipped workers as well, from $4.35 in 2019 to $6.75 in 2023. As of January 1, 2019, the minimum wage has been raised to $12.
In addition to these wage gains, some lawmakers want to do away with the sub-minimum wage that is paid to tipped workers, saying that these workers are not guaranteed a fair salary. The current law stipulates that tips must make up the difference so that the tipped workers are earning at least minimum wage. Employers are supposed to make up the difference when tips do not compensate, but not all business owners are honest and there are many restaurant workers being exploited. Tipped workers are mostly food service workers and are almost 70 percent female.
State Senator Patricia Jehlen of Somerville (D) and Representative Tricia Farley-Bouvier of Pittsfield (D) have both stated their support for eliminating the state’s sub-minimum wage for tipped workers. They are backing a bill that would gradually raise the wages of tipped workers to $13.95, and would require tipped workers’ wages to equal the state minimum wage in 2028.
Restaurant owners object to the bill and say that it would be unsustainable to pay food servers the full minimum wage. They warn that the bill could force many businesses to close. Restaurants are already scrambling after the new legislation went into effect on January 1 this year because of required changes to the way that server pay is calculated. Previously, restaurants could take the average of a pay period to ensure that employees were receiving at least the state minimum wage when tips and wages were added over a one or two-week period. However, the new legislation requires that employers calculate server pay for every shift, ensuring that workers are getting minimum wage per shift worked. This is a challenge as restaurant workers typically balance out slow and busy shifts over the week. Employers will likely find themselves making up the difference for the slower shifts.
Aside from the added cost of ensuring employees are receiving minimum wage per shift, restaurant owners are not yet equipped with payroll systems that support these per-shift pay calculations. Until payroll systems are updated, many employers will have to do the calculations manually.
(Image via Wikimedia: FASTILY [CC BY-SA 3.0]