Labor Department hears public on wage increase for tipped workers

Nov 13, 2014

The New York State Department of Labor Wage Board held its third public hearing in downtown Buffalo Thursday to determine whether there should be a sub-minimum wage increase for tipped workers. Business owners, employees, and advocates turned out to discuss their positions on the issue.

New York State Department of Labor Wage Board
Credit Ashley Hirtzel / WBFO

The current sub-minimum wage for servers, bartenders, or delivery people in New York State is $5 per hour without tips, because tips are expected to bring them up to the current minimum wage of $8 an hour. But, advocate with the New York State Labor-Religion Coalition Emily McNeill says that’s not the case.

“If you look at the briefing documents that the Department of Labor has, the median income for waiters and waitresses is in the ballpark of $19,000 per year, and we know in everyplace in New York State that’s just not enough to live on,” said McNeill.

New York State Labor-Religion Coalition Advocate Emily McNeill
Credit Ashley Hirtzel / WBFO

McNeill says the poverty rate for tipped workers is double that of the regular workforce.

"There are some employees in fancy restaurants in Manhattan that do make great money, and that's great, but that doesn't represent the majority of the industry," said McNeill.

But, some are calling for the state to keep the current minimum wage policy for tipped workers in place. Managing Partner for the Outback Steakhouse on Niagara Falls Boulevard Anthony Le Page says the current system is working fine. He says his tipped employees are averaging $15 to $20 per hour.

“Increasing the tip minimum wage would leave me with only a few options. Close my business, costing many jobs. Modify my business to a more over the counter type, cutting my staff almost in half. Modifying my systems to add more technology and to have fewer staff members working each day, cutting jobs by half. We could also raise price, which we know is very risky,” said Le Page.

Single mother of two, Renee Mullen is a Server at 

Managing Partner for the Outback Steakhouse on Niagara Falls Boulevard Anthony Le Page
Credit Ashley Hirtzel / WBFO

Outback Steakhouse on Niagara Falls Boulevard. She says serving is where she can make the most amount of money in a little amount of time.

“Raising the tip employee minimum wage will have a huge affect on tips. We as servers count on those tips, it is our livelihood. Not only will this affect employees negatively, but it will affect businesses,” said Mullen.

The state is set to raise minimum wage to $8.75 by the end of the year. The Wage Board will hold a final hearing on whether to raise the sub-minimum wage for tipped workers on December 9th in Albany.

New York State Labor Commissioner Peter is expected to make a recommendation by the end of January 2015 and a final decision by February 2015.