I am a server at a full-service restaurant in St. Paul. I am in favor of a tip credit, which guarantees workers at least the minimum wage at all times.
If St. Paul raises the minimum wage, why would I want myself and other full-service tipped workers to be excused from this increase?
Today, between the current minimum wage and my tips, I make well over $15 per hour. Most of my colleagues and many others who work in full-service restaurants will agree.
Without a tip credit, there are three factors that would reduce my earnings:
1) Patrons will be less likely to tip the same percentage, or tip at all, knowing tipped workers are being paid $15 per hour. Unfortunately, some see my profession as a low-skill job and will not tip, because occupations they consider of a higher skill set are paid only slightly more than $15 per hour. There are several articles online regarding this issue. Read the comments; many individuals have said: "If servers get paid $15 per hour, I see no need to tip."
2) Tipping may be converted to service charges. To offset their huge increase in labor costs, many restaurants may strongly consider implementing a service charge, in lieu of a tip, on every bill. A service charge is not a tip. Tips are the property of the worker; a service charge is the property of the owner. I'm extremely concerned because this would give employers the control over the majority of a worker's income. Service charges would potentially convert control of hundreds of thousands of dollars from the workers to the employers.
On Aug. 31, the Citizens League released a 446-page report on the St. Paul Minimum Wage Study Committee's process. The committee heard from two restaurateurs, one for and the other against a tip credit. Each presented potential business model changes that might offset the increase in labor costs.
The restaurateur in favor of a tip credit presented a service charge scenario that reduced tipped workers' earnings from $31 to $23 per hour (a nearly 26 percent reduction).