Restaurant Workers Warn Jobs Will Disappear If NY Eliminates Tip Credits

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Demonstrators rally outside a public hearing in Syracuse on eliminating tip credits. TOM MAGNARELLI / WRVO PUBLIC MEDIA

SYRACUSE, NY (WRVO) – The New York State Department of Labor is holding hearings across the state to gather input on Gov. Andrew Cuomo’s proposal to eliminate minimum wage tip credits. Many restaurant workers who attended a hearing in Syracuse said they are against the plan.

Maggie Raczynski is from Speigletown, New York, outside of Albany. She is a bartender at Outback Steakhouse who started a Facebook group, now with 20,000 members, that opposes the proposal to end tip credits, even though it would mean raising the minimum wage for tipped workers, which is lower than non-tipped workers.

“We do rely on our gratuities because we’re good at making them and we like doing that,” Raczynski said. “Once you take away the tip credit, our employers don’t have to give us the opportunity to make tips.”

Raczynski said it would also hurt restaurants by raising costs. Supporters of the tip credits received big cheers when they spoke at the public hearing.

Bar owner Bryan Hranek said abolishing the tip credit would force him to eliminate most of his employees’ hours, shifts and jobs.

“Every town in New York has at least one small establishment, similar to mine, that will be devastated by this drastic and unwarranted change to the industry,” Hranek said. “Worse will be the affect on the servers this travesty is purporting to help, as their jobs disappear.”

But Catherine Barnett, the director of the Restaurant Opportunities Center of New York, said women can be put in unpleasant and vulnerable situations to get tips.

“This can range from a seemingly innocent policy of requiring a sexy uniform, to being expected to put up with unwanted flirtation and advances from customers and managers for the promises of higher tips and or better or more frequent shifts,” Barnett said.

Barnett was joined by union members who represent car wash workers, who are also affected by the tip credits. David Jimenez, an organizer for the Retail, Wholesale, Department Store Union, said car washers want one fair wage, plus tips.

“They work very hard for the customers,” Jimenez said. “The customers give them tips. They feel it’s for their service. In this system, it’s sort of like the employer uses that system to compensate for their salary.”

Employers pay tipped workers a lower minimum wage than non-tipped workers, but must make up the difference if the tipped workers do not earn enough.

The hearings will continue until the end of June.

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