The subminimum wage for tipped workers isn’t simply born of racial injustice; it continues to perpetuate both race and gender inequity today.
In the mid-1960s, the guaranteed wage for tipped workers was $0 an hour. Today, the federal minimum wage for tipped workers is just $2.13 an hour — a just over $2 increase — and a mostly female, disproportionately women of color work force of tipped workers still faces the highest levels of harassment of any industry. Women restaurant workers in states with subminimum wage report twice the rate of sexual harassment as women working in restaurants in the seven states that have enacted One Fair Wage — a full minimum wage with tips on top. The women in these seven states — California, Oregon, Washington, Nevada, Montana, Minnesota and Alaska — can rely on a wage from their employer and are not as dependent on tips and thus feel empowered to reject the harassment from customers.
The unfair power dynamic between women tipped workers and male customers in most states has only worsened during the pandemic. Women restaurant workers report being regularly subjected to ‘Maskual harassment’, in which male customers are demanding that women servers take off their masks so that they can judge their looks and their tips on that basis. With tips now down 50 to 75 percent, male customers know women workers are more desperate than ever.
For Black women, the situation is especially dire. Before the pandemic, Black women who are tipped restaurant workers earned on average nearly $5 an hour less than their white male counterparts nationwide — largely because they are segregated into more casual restaurants in which they earn far less in tips than white men who more often work in fine dining, but also because of customer bias in tipping.
With the pandemic, these inequities were exacerbated; nearly nine in 10 Black tipped workers reported that their tips decreased by half or more, compared to 78 percent of workers overall. All workers were asked to do more for less — enforcing social distancing and mask rules on top of serving customers, for far less in tips. Black workers were more likely to be punished by hostile customers for attempting to serve as public health marshals than other workers. Seventy-three percent of Black workers reported that their tips decreased due to enforcing Covid-19 safety measures, compared to 62 percent of all workers. Technically, federal law requires that employers must cover the difference when the hourly wage, subsidized by tips, does not amount to $7.25 an hour. But in practice, that mandate is frequently ignored. A federal review of employment records from 2010-2012 revealed that nearly 84 percent of full-service restaurants had committed wage and hour violations.
Fortunately, the subminimum wage for tipped workers might finally come to an end if Congress enacts the minimum wage policy in President Biden’s new $1.9 trillion relief package in its entirety. The Raise the Wage Act, if passed, would not only raise the minimum wage to $15 minimum wage but also fully phase out the subminimum wage for tipped workers. This would be good news for women and people of color who’ve been denied a living wage and forced to endure harassment on the job, but it would ultimately benefit all tipped workers — and restaurants too. Workers in the seven states that have One Fair Wage receive similar or even higher tips as the workers in 43 states with a subminimum wage, and restaurants in those seven states have higher sales.
The National Restaurant Association has wasted no time launching a campaign to convince Congress to maintain the subminimum wage for tipped workers and the low minimum wage. This move hardly comes as a surprise. For more than 150 years since Emancipation, the restaurant industry has poured millions of dollars into lobbying elected officials to maintain their exemption from having to pay their workers a fair wage, causing tens of millions of women and men to experience poverty, food insecurity, home insecurity, and inequality over generations. As the Raise the Wage Act moves through Congress this month, the choice is clear: our representatives can choose to roll over to the trade lobby yet again and perpetuate a legacy of slavery, or they can choose to listen to the millions of workers — disproportionately women and people of color who increasingly represent this nation’s future voters — and make history during Black History Month by ending the subminimum wage for tipped workers once and for all.