Minimum wage hike for tipped workers? Restaurant group, local bartender say no

Raise the Wage Ohio is trying to get a constitutional amendment on the ballot to raise the minimum wage for both tipped and nontipped workers

A group of restaurant owners and employees on Tuesday spoke against a proposed constitutional amendment that could raise Ohio’s minimum wage for both tipped and non-tipped employees.

Ohio currently has a minimum wage of $10.45 for non-tipped employees, and $5.25 for tipped employees.

Raise the Wage Ohio’s constitutional amendment, which has not yet been approved for the November ballot, would take minimum wage for non-tipped employees to $15 by Jan. 1, 2026, with future increases linked to inflation. Meanwhile, the tipped wage would eventually match the non-tipped wage by Jan. 1, 2029, plus whatever they make in tips.

The Ohio Restaurant & Hospitality Alliance on Tuesday said the changes would be “devastating” not just to restaurants, bars, businesses and their employees, but to consumers and the economy as a whole. They cited a huge increase in labor costs to their businesses, as well as server/bartender opposition to changing the lower tipped wage system.

Lindsay O’Dell is a bartender at the Huber Heights location of sports bar franchise Submarine House and a 20-year veteran of the industry. At the OHRA’s press conference Tuesday, she said she loves her chosen career and is against the effort to raise minimum wage for tipped employees.

“We do not want our tips being messed with, our wages being changed,” O’Dell said. “I make over $30 an hour. My husband is an engineer who has went to college and I also went to college, and I make well more than he does. I’m clearly the breadwinner in the family.”

Raise the Wage Ohio — which is part of a national campaign organized by One Fair Wage — argues that their amendment wouldn’t hurt restaurant employees, as they are advocating for a full minimum wage plus tips, not one in place of the other.

The Ohio Restaurant & Hospitality Alliance disagreed. John Barker, ORHA’s president & CEO, said menu prices would likely increase by 20-25%, with some restaurants imposing new service charges to cover these higher costs.

Credit: Bill Lackey

Credit: Bill Lackey

Barker cited an online survey OHRA commissioned of 990 servers, bartenders and other tipped workers, one that showed 93% want to keep the current system with a base wage and tips that provide the ability to earn more than the minimum wage.

About 85% of servers and bartenders said that if the lower tipped minimum wage is eliminated, they believe customers are unlikely to continue tipping on top of any mandatory service charge.

Barker said the restaurant industry is Ohio’s third largest industry, employs about 550,000 Ohioans and is still trying to recover from the COVID-19 pandemic.

“Our industry is currently trying to weather the cumulative effect of record high inflation over the last three years,” Barker said. “That includes food, lots of supplies, and labor costs, which have soared.”

The proposed changes, Barker said, would increase labor costs by $4.55 an hour for every non-tipped employee making minimum wage, “which would place tremendous pressure on all businesses in Ohio, particularly small operators and mom and pops.”

Barker said in Ohio, tip workers never make less than the full minimum wage.

Mariah Ross, ballot initiative director of Raise the Wage Ohio, strongly disagreed.

“Today, one of our worker members who makes $5.25 plus tips and is canvassing for the initiative to collect signatures told me she made $60 after working 9 hours yesterday,” Ross said. “That’s less than $7 an hour. Real workers know that ending the sub-minimum wage and securing $15 plus tips is what is needed to create a more sustainable financial future for themselves and their families.”

Other findings from the OHRA survey, which was conducted in April by Pittsburgh-based CorCom Inc. include the following:

  • 91% agree that the current tipping system works well for them and does not need to be changed.
  • 83% of tipped employees say they are earning $20 per hour or more while 64% of tipped employees say they are earning $25 to more than $40 per hour.

Submarine House’s O’Dell said if One Fair Wage’s proposed measure passes she would have to find other work.

“I couldn’t afford my life any longer,” she said. “… No server, (and) I speak for all of us, we do not want this to pass. It will devastate everybody.”

One Fair Wage said the survey’s results are the result of “a strategy to mislead workers” that they would only get the new higher minimum wage, and not tips. They claimed that data from states like California, Oregon, and Washington show that an increase in wage does not result in decreased tipping.

Tod Bowen, ORHA’s managing director of government relations & external affairs, said his organization supports Senate Bill 256, which he called “a slower path to a $15 minimum wage for non tipped workers.”

Introduced by State Senator Louis Blessing, R-Colerain Twp., that legislation aims to increase the minimum wage to $15 by Jan. 1, 2028 for non-tipped employees, and would do that by increasing the minimum wage by a dollar each year after the first increase to $12 on Jan. 1, 2025.

Blessing said the minimum wage for tipped employees would be half of the non-tipped wage, so $7.50 by Jan. 1, 2028.

“Servers in restaurants make far more than minimum wage,” he said. “Raising their base pay would actually be very harmful to them because the additional costs may lead employers to lay off workers, or even go out of business.”

Bowen said ORHA will mount a “robust, grassroots effort” to combat any ballot initiative by One Fair Wage.

Democratic State Senators Kent Smith of Euclid and Hearcel Craig of Columbus proposed their own minimum wage bill last year, raising pay by a dollar each year, to $15 in 2027. Smith told this news outlet Tuesday that all three proposals are better than the status quo.

“All of these would be great for the 30% of the people in the state of Ohio that are at or near the federal poverty level,” he said. “Those are the folks that can’t make big campaign contributions. They’re struggling to pay their utility bills.”

However, he said the Raise the Wage Ohio amendment would provide the most permanence, as bills can potentially be repealed by lawmakers while something voted in by Ohioans cannot.

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