Minnesota restaurants want tips included in minimum wage

Categories: Food, News

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The MN Restaurant Association wants an exemption to wage increase for workers who make more than $12 an hour with tips

With the state Legislature looking to thrust Minnesota's minimum wage up to $9.25 an hour, The Minnesota Restaurant Association (MRA) is throwing its hat into the debate, suggesting that the increase could throw the hospitality industry into financial difficulties. The group is seeking exemptions for tipped employees to help offset the increase in expenditures.

According to the MRA, tipped employees are making on average more than $12 an hour when tips are factored in. Their proposed plan adds a second tier to the minimum wage of $7.25 if employees' wages and tips combined exceed $12 an hour. Currently minimum wage in Minnesota is the same for both tipped and untipped employees.

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Should servers make full minimum wage plus tips?
The MRA is asserting that because restaurants already operate on extremely slim profit margins, the increase in wages for tipped employees will force them to have to pass the costs on to guests through increased prices on menu items and cut back staffing.

The MRA claims that "full service restaurants face increased competition from concepts where guests order and pay for their food and beverages at a counter. These fast-casual businesses don't offer the opportunity for tip income, which would result in higher individual earnings."

The association goes on to clarify that tips are already considered to be income when it comes to things like income, payroll, unemployment taxes, Medicare, and social security. It argues that the only place tips are not factored in as income is when it comes to the minimum wage.

The idea of the tiered system is to give restaurant owners a little breathing room when it comes to the added labor costs because most nontipped restaurant employees already make more than $9.25, so it won't affect that portion of the business.


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6 comments
Chris Pederson
Chris Pederson

Not everyone has choice when it comes to the job they get.

Nicholas S. Goers
Nicholas S. Goers

Not every server deserves a tip, that's for sure so why should a restaurant increase the price of their food to cover that? That will cause more damage, because people will just stop going out all together. They should take tips in to account and if you don't like it, find a new job than!

Dee Finkelson
Dee Finkelson

im a server n i dont like the idea! leave it as it is. Doesnt mean that i dont like the min wage raise, but hell no they'll cap our income to $12/hour !! If u work for company/factory u'll get benefits n such. But for individual resto with no big chain u dont get anything. So screw that.

Cara Flora
Cara Flora

good luck finding quality servers if that happens

Chris Pederson
Chris Pederson

why can't the restaurants just charge a little bit more and raise the wages, then we won't have to tip.

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