Tip-credit argument is nonsense in minimum-wage debate

  • Article by: KRIS JACOBS
  • Updated: February 21, 2014 - 7:05 PM

Ignore the restaurant industry's recycled arguments.

Although neither of the minimum-wage bills pending in the Minnesota House and Senate has a provision that allows servers to be paid less than the minimum wage, you would never know it from restaurant industry exhortations. The Feb. 1 Business section commentary, “In the push for higher pay, don’t forget tips,” needs correcting.

Minnesota law bars the practice of paying servers less than the minimum wage of $7.25 an hour, because labor standards have been higher here since 1986. Surrounding states have no such prohibition. Wisconsin pays $2.33, Iowa $4.35, North Dakota $4.86 and South Dakota $2.13.

In his commentary, a Minneapolis restaurant owner insisted that paying the minimum to wait staff “artificially puts downward pressure on kitchen wages” — an argument that gets recycled every year but is never supported by the facts. The notion is contradicted by wage data from surrounding states. For example, that a Wisconsin waitress earns $2.33 an hour, but kitchen workers still earn nearly $1 an hour less than Minnesota workers.

Minnesota legislators should understand that the real “artificial pressure” is coming from a handful of well-heeled lobbyists hired to exploit their advantages, lower our expectations and drop the higher standards that define our differences. Minnesotans value a workforce that is always at or near the top of every measure of labor force excellence. Let’s keep it that way.


Kris Jacobs is executive director of Jobs Now Coalition.

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