MinnEcon: July 7, 2010 Archive

'You miss the shift, you lose the money.'

Posted at 12:26 PM on July 7, 2010 by Paul Tosto (1 Comments)
Filed under: Jobs & unemployment

The "$100,000 waitress" was the talk of the day Tuesday. Minnesota gubernatorial candidate Tom Emmer discussed a lower minimum wage for people who work for tips, arguing that some restaurant servers make upward of $100,000 a year and that businesses needed more wage flexibility.

It was sound off time after that.

MPR news had a solid news story on the issue. My NewsCut colleague Bob Collins dove into Myths and the minimum wage debate.

We asked Minnesotans in MPR's Public Insight Network if tips should be figured into someone's base wages. We got some terrific responses we wanted to highlight.

Leah Wilkes is a Network source who moonlights 10 to 15 hours a week at a Twin Cities café. That's the real situation for many people who wait tables. It's not a career. It's a means to bring in some needed cash in a state that has one of highest percentages in the nation of people who work multiple jobs.

Emmer cited a report that used data from 1999 to make the case that "tip credits have essentially no negative impact on wages for tipped employees" and would ultimately help businesses.

That minimum wage check, however, serves a very practical need, says Wilkes.

"I can't remember the last time I actually got a paycheck from my service job. In other words, the paychecks are garnished to cover the taxes on the tips that I make," she told us.

"It's not icing on the cake and usually at the end of the year, I owe a little more." She add:

Almost all service industry people I know don't have benefits.

I do, because I work another job. But for the majority, any illness or injury (off the job) is not covered and I have seen people lose their shirts for emergency visits - not only in the cost of care but also in the lost shifts. There is no such thing as "sick time" in the service industry.

You miss the shift, you lose the money.

She also noted that "on average, a bartender will make 15 to 20 percent of their sales.

So a $100,000 a year bartender, for instance, would be generating $500,000 in sales. "Multiply by that by several servers and bartenders and it sounds like a pretty successful restaurant to me."

As the MPR story noted, $9.36 is the current estimated median wage of wait staff in Minnesota and a state expert says only 10 percent of the state's servers earn more than $17.64 an hour or $37,000 a year.

"I wait tables to supplement my full time day job," said Christine Rosenquest, a Network source from Minneapolis who described her occupations as auditor / waitress.

"Tips are never a guarantee! My tips can range from $50 for a Saturday night to $300. Tips depend on everything from the weather, holidays, and a person's mood. Not to mention that waiting tables is a hard job."

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