The federal minimum wage for tipped workers is $2.13/hr. While that is remarkably low, there is a caveat requiring the employer to compensate for any difference if the worker does not actually make the current federal minimum wage of $7.25/hr. How often that happens, though, is incredibly rare.
Some people might wonder why there is such a stark difference between the wages of tipped income earners and even the paltry wages of other minimum wage earners. The National Restaurant Association is one of the biggest lobbying firms in the nation, currently ranked in the top 250. They are a powerful force to be reckoned with and have not only fought to keep the wages of tipped workers down, but also pushed against raising the federal minimum wage of average restaurant workers.
Bar Marco, an upscale-yet-affordable diner has bucked this trend and is taking on the industry in its own way. Founded in 2010 by four friends who, according to their website,
…quit their corporate jobs and set out on a mission to change Pittsburgh’s food culture.
The founders were so inspired by one of their food mentors, Marco Enrico, that they named the business after him. According to their website, Marco’s house tragically burned to the ground but he continued to give back to his local community despite the hardships he endured. Keeping in line with his spirit of giving the owners of the company have eschewed the traditional spirit of the powerful restaurant lobby and have stripped their workers of all tips, instead offering them financial and job security.
Here is what the restaurant is now promising all workers:
- $35,000 base salary (starting)
- 10 days paid vacation
- 500 shares of company stocks
- Maximum 44 hour workweek
A company built upon the premise of giving back to the community is truly living up to its ideals. This means that the lowest paid individual to work for this company will be receiving no less than $15.30/hr – and that is if they work the maximum of 44 hours per week.
People have already begun lodging complaints that this will reduce the efficiency and friendliness of the tipped workers, but according to a study completed at Cornell University good tipping is not indicative of good service. People whose basic needs are taken care of will be more productive, friendlier, and offer the service to which they know is expected of them. It does not create job security because they will act with impugnity. In fact, it does precisely the opposite.
According to a 2011 report by Allegretto and Filion of the Economic Policy Institute
Tipped workers experience a poverty rate nearly twice that of other workers.
After three successful years this company has grown from just the four owners operating the restaurant to being named in the top 50 “New Restaurants”, as well as one of the top 33 Cocktail Bars in the United States. It is not merely the food, nor the service they provide, but clearly how they value the worth of their employees that has helped them rapidly grow from a start-up to a restaurant with national recognition.
Now, if only we could get more restaurants on board with this then perhaps we could begin to fix the income disparity problem with our working class.