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Total Compensation Is the Only Way to Raise Workers' Income and Preserve Your Local Favorite Small Business

Total Compensation Is the Only Way to Raise Workers' Income and Preserve Your Local Favorite Small Business

James Yamasaki

TOTAL COMPENSATION Means tips, benefits, and other forms of compensation would count toward wages.

Dave Meinert owns several local businesses including the Comet Tavern and the 5 Point Cafe. Below, he argues in favor of total compensation. Over here, Jess Spear argues against total compensation. They will be responding to each other's arguments Friday, April 4 on Slog.

I've worked in the hospitality industry since 1980 and own several businesses that employ close to 200 people in Seattle.

I support a $15 minimum wage that includes total compensation because it is how we can raise the guaranteed minimum income for the lowest-paid workers without closing low-margin, high-labor-density small businesses, while at the same time ensuring tipped workers are guaranteed a livable base income without lowering the income for those tipped workers currently earning more than $15. Without total compensation, raising the minimum wage will cost many jobs and could close your favorite local business. 

"Total compensation" is simple: In many industries, an employee's earnings are only part hourly wage, the rest made up of other forms of compensation—tips, commissions, bonuses, and benefits. This non-hourly-wage compensation can often be the largest part of an employee's income.

In the restaurant industry, every employee is guaranteed the state minimum wage of $9.32 per hour. In addition, servers typically receive significant income from tips. 

Average tips in Seattle range from $10 to $35 per hour or more. About 90 percent of tips are paid on credit cards, making them easy to track. These tips show up on employees' W-2 forms and are counted as income by the IRS. As we increase minimum wage and food prices rise to compensate for that, servers will also get an increase in tips. 

Total compensation counts verifiable tips as part of guaranteed minimum earnings. The tips must show up on the employee's paycheck every pay period, and that paycheck would show the number of hours worked and what the tips added up to per hour. Benefits could be handled the same way—the value of the benefits would be averaged over the hours worked. Total wages, tips, and benefits would be tallied on the employee's paycheck, which would clearly show what is earned per hour. If it's ever less than $15 per hour, the employer would have to bring it up to $15 by increasing the wage for that pay period.

It is standard around the US for minimum-wage laws to count non-hourly-wage earnings and benefits as wages. San Francisco allows a meal credit and counts bonuses and commissions; Miami-Dade County and Boston have a credit for health care; Albuquerque counts health care and child care; San Jose counts commissions, meals, and bonuses; Santa Fe allows a tip and meal credit and counts health care and child care; DC has a tip credit with a base of $2.77 and counts commissions. All of these laws were backed by labor and the living-wage movement. Obama's $10.10 proposal also counts tips as wages. It would be more than ironic that the same people supporting tips and benefits counted as wages elsewhere would be willing to harm small businesses locally by denying Seattle the same thoughtful regulation.

Enforcement is key. We need harsh punishments for any business that doesn't pay $15. I suggest a fine of two to three times the amount underpaid plus interest for the first offense, and loss of business license or jail for the second offense. Employees must also have a place to take labor complaints, and we should look to San Francisco and form an Office of Labor Standards to ensure this and other local labor laws are enforced.

Don't allow false rhetoric to win this debate. Go out to your favorite local restaurant or retailer and ask the owner what they think about the concept of counting total compensation in a new Seattle wage policy. Ask your server if they are making a living income after tips and what they think about this debate. Engage and educate yourself on how diverse worker income is and how it works in our community. I bet you'll be surprised. recommended

Read a rebuttal of this argument by 15Now organizer Jess Spear.

 

Comments (51) RSS

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1
The only way this is going to benefit society as a whole is to make sure we are taking total compensation and tips into account. If we don't, all servers currently earning tips will be hurt and small businesses will ultimately end up closing. We need to phase it in like Dave says, and make sure we are looking at this holistically.
Posted by jen in seattle on April 2, 2014 at 9:41 AM · Report this
rdub 2
You know who else doesn't oppose total compensation ? The same people who have created the only cut-out in the proposal. The Labour Unions. This is because they not only support it , they use it in their own contracts. They consider Health care, meals , retirement, transportation etc. as part of TOTAL COMPENSATION.
Posted by rdub on April 2, 2014 at 10:18 AM · Report this
trstr 3
Not mentioned anywhere here is the basic fact that total compensation is nothing more than shifting the cost of traditionally employer-given benefits onto the employee. It's a shell game done to the employer's benefit, and the worker loses out. "You thought you were going to get $15/hour? Haha, now get back to work!"

Meinert says that we are doing things differently than other localities. That's a bad thing? We don't want to be DC with a base $2.77 wage. That's crap. Dave, if you want a system like that, feel free to move away from us who don't. Don't drag us down to their level.
Posted by trstr on April 2, 2014 at 10:31 AM · Report this
4
The bizarre thing is that NOBODY has ever proposed Deep South style tip credit- to drive wages down to $2-3 buck an hour. For all that I know, what's being discussed is retaining the current minimum wage as a base, and if tip does not supplement enough to reach the new level of MW- employer has to supplement that. This way currently tipped employees would still make at least 9.32 (or higher), plus retain the amount of tips they are currently making. Reason- overall prices at restaurant would not raise 25-30%- as they would if tip is not counted in the wage calculation- but by 5-10%, which the public can afford and will not decrease tipping or attendance frequency. The actual result is no astronomical price hikes, no restaurant closures, no job loss of any kind.
If tip is not taken in consideration in the wage formation, restaurant prices will rise with 25-30%. That means dramatically decreased tipping- cause the public's spending ability has not improved by said percentage. Or, as I'm overhearing, the restaurants can raise prices by 25-30% and forbid tipping- Starbucks style. Then the restaurant would have the discretion to decide what wage overall to pay its servers. My guess is that restaurants would calculate wages based on their worst months of performance, resulting in actual DECREASE of overall home bring cash by servers, bartenders and even back of house. In other words, half ass thought through policy by the unions and 15NOW will decrease the income of restaurant employees. I wonder, if they are pro- interest of the working public, why would they want that? What is the sick political calculation behind it? No server or bartender I've talked to supports the idea of tip not factored in the equation.
Posted by valume on April 2, 2014 at 11:28 AM · Report this
rdub 5
As stated, Unions include Total Compensation in thier agreements . So maybe they should get I the same buss out of own as Meinert?
Posted by rdub on April 2, 2014 at 11:29 AM · Report this
rdub 6
* get of the same bus
Posted by rdub on April 2, 2014 at 11:30 AM · Report this
rdub 7
*on
Posted by rdub on April 2, 2014 at 11:33 AM · Report this
trstr 8
Yes, if unions are screwing over their members, as they often do, they should fuck off as well.
Posted by trstr on April 2, 2014 at 12:04 PM · Report this
9
Meinert is correct, tip penalties are standard across the US ("total compensation is NOT)... BUT, WA successfully cast this off when voters approved I-518 in 1988, increasing labor wages in tipped industries by 85% over 2 years.

A larger jump in labor costs for these industries. In less time than 15 Now is proposing. And employment in those industries fared better than the overall economy in the following period. So BS to Meinert and those trying to use this debate to regress our labor standards.

And @rdub and other right-wingers. A union negotiating a contract that is, say, $13/hr in wages + healthcare benefits that accrue to the workers entire family, that is voted on by the workers, is entirely different from an employer imposing deductions based on "benefits" that they decide on, with who knows what deductibles etc.

http://slog.thestranger.com/slog/archive…
Posted by bogart14 on April 2, 2014 at 12:34 PM · Report this
10
Wouldn't "total compensation" basically mean that nothing would change?
Posted by AlaskanbutnotSeanParnell on April 2, 2014 at 12:49 PM · Report this
11
@9 what the fuck, seriously?! You're supporting the union exemption simply because you think it's right wing to oppose it?!
Posted by marianbuilt on April 2, 2014 at 1:09 PM · Report this
12
@10 - no, total compensation would mean that everyone is guaranteed $15 earnings, but with a credit if the employer paid for health care.

So for example, a server would get $9.32 per hour wage (never below the state minimum wage), and then their tips would account for the rest up to $15, if they made that much per hour in tips. If they didn't make enough in tips to them to $15, then the employer would have to make up the difference. No one would make less than $15 per hour.

Back of house would all get raises up to $15. Any business, say like McDonald's, where employees don't earn tips or commissions, would have to raise them up to $15. The only people not getting raises are the ones already earning $15 or more per hour.

For health insurance, it would be something like that if the worker got health, $2 of that cost would be a credit off the minimum wage. So the minimum wage would basically be $13 if health insurance provided, $15 if not. If health insurance isn't included, many small businesses wouldn't provide it and would just transfer this cost to wage. The employee by law would have to go pay for it themselves. We know that many employees won't do this, which is bad for everyone. So I favor including a credit for health insurance.

This isn't a tip penalty. This is counting real earnings as part of the minimum wage and guaranteeing them.

Posted by Meinert on April 2, 2014 at 1:36 PM · Report this
13
@marianbuilt - I didn't say that I necessarily support a union exemption, but made a distinction between a union negotiating a contract that includes other forms of compensation such as healthcare, which would include what type of plan you get, vs. Dave Meinert imposing whatever he determines will save him the most money on labor costs. Big difference.
Posted by bogart14 on April 2, 2014 at 1:49 PM · Report this
trstr 14
@12: Those "real earnings" [sic] aren't being calculated as part of the minimum wage now. The only reason that you want to change that is because you want to avoid paying your employees more money. You want the benefits that you give now to be counted as wages in order to cheat your workers. It's as simple as that.
Posted by trstr on April 2, 2014 at 2:25 PM · Report this
pinksoda 15
What I find interesting about the phrasing of this debate is this: wouldn't it unfairly penalize lower end restaurants as compared to higher end restaurants whose servers are practically guaranteed >$15/hour now, simple because of the cost of dining in those higher-end establishments? How could this be made more fair for the employers at Rancho Bravo, for example, who may have to supplement their server's wages and who would have a more difficult time doing so than, say, the employers of the Canlis, who probably would never have to supplement their server's wages?
Posted by pinksoda on April 2, 2014 at 2:27 PM · Report this
16
@13 I have yet to see any benefit package that cost my employees more than it cost me, the business owner. But if you know of some, I'm all ears. Before you vilify me as a greedy business owner in the process, please note that I am for raising the minimum wage, my lowest paid employee makes $20/hr before any benefits, and I cover more than the allotted 50% of the benefits I do offer.

Now, could you explain to me how someone in the union, paying union dues, and earning less than what should be minimum wage is better off. Without using Dave as an example?
Posted by marianbuilt on April 2, 2014 at 2:35 PM · Report this
17
@16 - The point is that there is a world of difference between a biz owner deciding that they are going to include paid sick leave, meals, healthcare (costs of which are going up way faster than CPI), tips etc. in "total compensation", and workers negotiating exactly what will be counted, and how. Also if you have an organization behind you making complaints about wage theft is much more feasible/less scary.

In general this "total compensation" method of subverting the increased wages would make wage theft much more common and easily done. Already a "2009 study of nearly 4,500 low-wage workers found that more than two-thirds experienced at least one pay-related violation in their previous work week". 2/3rds in 1 week!

Additionally @15's point is spot on. This would give high-end restaurants a competitive advantage in terms of labor costs over cheap diners, Pho joints etc. And Dave has made an example out of himself of the quintessential business owner that feigns concern about the community in order to protect their profits. And ham-handedly at that.
Posted by bogart14 on April 2, 2014 at 3:18 PM · Report this
18
Total Compensation: Making me pay your worker's salaries via my tips.

When I tip, my goal isn't to help POS, I mean Meinert, pay his employees. When I tip, my goal is to give extra cash to those that have provided me quality service.

So fuck you, Meinert.
Posted by Bloated Jesus is Bloated on April 2, 2014 at 4:48 PM · Report this
sikandro 19
We obviously can't trust the economics of anyone whose bar charges $1/game for pool.
Posted by sikandro on April 2, 2014 at 5:34 PM · Report this
20
Thank you Dave, this is a smart piece about the $15/hour minimum wage. I also support a minimum wage increase, and don't think that $15 per hour is out of line, but need total Compensation in order to sustain paying it. What Dave doesn't say directly here is that we all pay our kitchen staff more than minimum (in many cases more than $15) and so they will see little to no increase. Our servers and bartenders, on the other hand, who received minimum wage plus tips, will see the largest raise in the restaurants. That said, servers and bartenders at our restaurants make between $25 and $65 per hour in tips, and they don't need a raise. That is money we would rather use to pay the employees in the kitchen who have giant skills, work incredibly hard, and are often struggling to make ends meet. There is a giant income gap in restaurants as a result of the fact that federal law prohibits us from demanding that servers share tips with the kitchen, even though the kitchen has a large part in making the table happy (perhaps not as large as the server, but quite a bit, wouldn't you agree?). Please talk to your city council member, and our mayor and encourage them to keep total compensation in any legislation or referendum on the minimum wage in seattle, it is the only way to guarantee that we can help the people who are most in need, without unintentionally harming large groups of people in the process.
Posted by JakeK on April 2, 2014 at 5:54 PM · Report this
21
If the servers are paid $15 an hour the money simply isn't there to pay kitchen employees more than $15 meaning that a cook who has been working and honing her skills for a decade will be paid the same wage as the dishwasher starting tonight.

IF, as Dave says above, server's gratuities are included in their compensation (total compensation), the kitchen employees will be able to be paid more to care for their families and not need to work two or three jobs.
Posted by guitarman on April 2, 2014 at 6:12 PM · Report this
22
If the goal is to raise everyone making minimum wage out of poverty, and the costs of healthcare are a part of that calculation, it would seem reasonable to include that as part of the total package. More importantly, without total compensation, we are creating inflated labour costs in places that are unnecessary. When a server is making 25-35 an hour, giving them a $6 raise, doesn't seem to line up with the ultimate goals of lifting people out of poverty. It's an excessive raise, and ultimately limits the room for back of house to earn more than the proposed 15 minimum. I do think there will have to be a shift in the way restaurants work (prices included) to achieve this $15 MW increase, but, verifiable income (as tips are to the IRS) seems like a logical inclusion in the new MW evaluation. Especially when there would be regulatory provisions in place. I think it's simple fear mongering to assume that every employer is going to rip off all their employees, and there for no exceptions can be made. While I think you can always find a few bad apples in the bunch, safe to say those people are going to find a work around to what ever rules you create. If they want to really buck the system, they can simply pay cash under the table to illegal workers. Doesn't seem like a good enough argument to discount a win win situation for both small business and it's employees.
Posted by swakinc on April 2, 2014 at 6:35 PM · Report this
trstr 23
So, what I hear you all saying is that you want to pay for the $15/hr increase on the backs of your waitstaff.

That's fucked up, dudes.
Posted by trstr on April 2, 2014 at 8:51 PM · Report this
24
@15 15NOW has fucked RANCHO BRAVO either way. They should have thought about this before...
Posted by Moresanity on April 2, 2014 at 9:19 PM · Report this
25
@23 please open your own business and practice what you preach. Report back to us next year.
Posted by Moresanity on April 2, 2014 at 9:23 PM · Report this
26
Ugh, I was 100% behind a tip credit. But this "health care, meal credit" is bullshit. You can't pay the bills with a meal credit, and health care should be standard, not an excuse to pay people less.

Tip credit makes sense, as long as you ensure that the employee makes at least 15 bucks an hour, but any other non-cash benefit should not be included. And by including these in your argument you're weakening it.
Posted by j2patter on April 2, 2014 at 9:57 PM · Report this
27
And "meal credit" is complete bullshit. I've worked in restaurants in high school/university, and some ran by close friends. Food gets thrown out, so to pay for a meal or give a discount on food hardly costs restaurants.
Posted by j2patter on April 2, 2014 at 10:28 PM · Report this
28
Washington state at $9.32 is the highest state minimum wage in the state. It is unwise for the city of Seattle to raise it further. Most economists agree that minimum wage laws are harmful, not helpful. They discriminate against low skill people and make it impossible for them to find jobs.

Restaurants with tipped wait staff are not the only businesses impacted. There are plenty of small retail shops that just get by. I'd rather have them employing some people at $9.32 than closing and providing no employment.

Furthermore, if it were legal for people to work for $6 per hour, there would be more people out there working and staying out of the rain and at least feeling someone productive, not shut out. No one forces anyone to work for anyone. Coercion is wrong. Free markets work. Do we no longer want 11th graders to be able to work part time jobs? Is anyone going to pay an 11th grader $15 to scoop ice cream? Do we no longer want small neighborhood ice cream shops and the like?

Why do people feel it is moral to demand a certain wage rate at the point of a gun? If it is so easy, and you are an employee complaining at the wage you are getting, why don't you open up a business next door and do it better? And pay better?
Posted by eminor on April 2, 2014 at 11:53 PM · Report this
Theodore Gorath 29
@28: Democratic voting for laws is the exact opposite of demanding things at the point of a gun.

If you had actual arguments or any public support, you would not have to make up rhetorical garbage like that.
Posted by Theodore Gorath on April 3, 2014 at 5:01 AM · Report this
30
29@ at least dispell his rhetorical garbage . Or is that beneath you. He makes a good point. Is it better for Seattle to have higher unemployment and less jobs fr low wage workers in return for more pay for those who work???
Answer that
Posted by A real live employer on April 3, 2014 at 7:23 AM · Report this
31
Sure, a carveout is a great savior for bars & restaurants, but would this plan not leave non-tipped/commission-based businesses out in the cold? Why is it OK to have these carveouts that allow us restaurants & bars to dodge a wage increase, but levies this massive rise in expense to all of our neighboring retail & manufacturing? How can the art & pet supplies stores survive with having to raise their prices to what many say would be set at an unsustainable level. What about clothing or bookstores? What about manufacturing? What about non-profits? We get these carveouts for our industry but we leave behind every other business? How is that right, logical or possible?

The problem here is not that bars need a carveouts for Total Compensation but that the arbitrary number chosen - $15 - is simply too much in this economic climate. It's not sustainable for all.

Sure, I'd LOVE to pay my people $15, but you're ready to subject every business to a race of figuring out how to manage this new massive increase in the cost of doing business and are accepting that many simply will not be able to survive as a sad but necessary effect of what really is just political pressure by a group that has no idea of business realities?

We can't abandon our neighborhood businesses who don't qualify for Total Compensation. It's time to stand up and tell people the truth about how not every business can survive having to wait until the rising tide if a minority of greater income earners, this 'Trickle-Around Economics' works a miracle and creates so much more income around Seattle as to allow them to earn that massive increase in the cost of doing business.

We can't just abandon these businesses and these workers who will be our of work because is this cowardly & myopic plan which only saves some businesses at the expense of others. We can't be selfish like that.
More...
Posted by I'm Cool on April 3, 2014 at 8:58 AM · Report this
Theodore Gorath 32
@30: What point? It was all based on imaginary scenarios, with no evidence presented. You also have no point, and present no evidence. Please present evidence of your assertion that raising the minimum wage will lead to higher unemployment and economic downturn.

If it is so obvious, it should be easy to find evidence for your assertions, right?
Posted by Theodore Gorath on April 3, 2014 at 9:53 AM · Report this
33
Dave, ever since the 1988 minimum wage hike - the job growth in Washington exceeds the national job growth rate. Just stop already.
Posted by Readabook on April 3, 2014 at 10:53 AM · Report this
34
If you want a tip credit, I am open to that. Total compensation? In the immortal words of Jon Stewart: "Go fuck yourself! Go fuck yourself!"
Posted by Hanoumatoi on April 3, 2014 at 11:26 AM · Report this
35
@31 provides one of the more interesting comments to this whole argument. Everyone seems to be looking at bars for the standard of how small businesses will handle the wage increase, but seem to ignore other business (I know this is not completely the case, but I see more comments/stories in relation to bars and restaurants than anything else.) Even if Total Compensation were to work for them, it wouldn't work for any of those other businesses.

The more I think about the thought of a $15 minimum wage, the more it doesn't make sense. One argument I keep seeing is that with the wage increase, those people who didn't have the extra spending cash before, will now have the money to go out and use that new hard earned cash in small businesses. But if the whole argument for supporting a wage increase, is to lift people teetering on the poverty level up to a livable wage (meaning they can effectively pay for their rent, bills, groceries, support their children, etc.) - what makes people believe that they'll suddenly have all this extra cash to just sling around?

This isn't to say I'm completely opposed to a wage increase, the number is just too high. Small increments over time make much more sense, and personally I think a good place to start would be to match San Francisco's minimum wage of $10.55/hr - a city who's cost of living is 20% higher than Seattle's.
Posted by tmc on April 3, 2014 at 11:41 AM · Report this
TheMisanthrope 36
"Trickle-around economics" is the new buzz term from business groups? It's not that catchy...try again Friedman.

If any business depends on the poverty of their employees (including busboys, whom Friedman never mentions, or the kindness of strangers to pay their employees, that business does has no place in this country.
Posted by TheMisanthrope on April 3, 2014 at 2:07 PM · Report this
37
Funny how commenters that reference I-518 enacted in 88' and it's minimal impact on jobs fail to mention that it was followed by the 3 yrs of the highest inflation in Seattle in 25 yrs. CPI's of 4.7% in 89', 7.4% in 90', & 5.8% in 91'. Seattle hasn't seen CPI adjustments that high since. I am not suggesting I-518 is the only cause for this inflation, but to suggest an increase in minimum wage has no effect on inflation is either ignorant or disengenious.
Posted by sawant is an idealogue w/ no business experience on April 3, 2014 at 3:19 PM · Report this
38
Theodore Gorath.The burden of proof is on your crowd.

But for starters how about the Congressional Budget office report( That just came out btw.)
That says 500k jobs will be lost by a raise of the minimum wage to 10.10 nationally. There you go!! And that is from $7 to 10.10. Or is the unbiased neutral party CBO wrong here.

We are talking about btw going from 9.32 to 15 different story..

So I cited an example..Cite yours( keep in mind the highest increase in MW was San Fran's 27% increase over 3 years ) not 60%+.

There is no example of a MW going up this high this quick. Never has happened and is unprecedented..So good look trying to compare SF,DC or even the City of Richmond for that matter(which is going to be the highest Nationwide)
Posted by A real live employer on April 3, 2014 at 3:33 PM · Report this
39
@23 why don't we just eliminate tipping altogether? That way we ensure that business owners aren't cheating the system and it ensures that servers make the same amount as cashiers or other workers in "non-tipping" jobs.
Posted by db206 on April 3, 2014 at 4:13 PM · Report this
40
How about banning tipping, raising prices of food accordingly, and providing a stable income to waiters? Seriously, if a meal costs $10 and I have to add $1.50 as a base tip, why is it that the meal cannot cost $11.50? I would have already paid that much, plus as a customer I would know exactly how much I'd have to pay in the end.

This "total compensation" thing is just bullshit to avoid paying your employees what they deserve.
Posted by Ailurus on April 3, 2014 at 6:18 PM · Report this
41
It's amazing to me that people are actually saying we should get rid of tipping. I'll respond to this in Slog today. But not counting tips as part of total comp means servers will make far less than they do now. Ask ANY server in Seattle if they would rather get a $15 wage w/o tips or $9.32 wage with tips and have that guaranteed to never be less than $15 per hour. People are ignorant if they think servers make less than $15 per hour in Seattle.
Posted by Meinert on April 4, 2014 at 8:47 AM · Report this
42
A lot of alarmist BS tactics going on. Tipping is not mandatory now and no one is going to make it illegal despite whatever propaganda is out there. Ask any server if they would like to make $15 with the same possibility of making tips. It's ridiculous to say not adopting total comp will cause servers to make less. Correlation does not imply causation. It would be nice if these business owners spent the same kind of energy they are using to fight better wages for employees for something more constructive. So gross, I have stopped patronizing all of the businesses spouting this garbage and I am not the only one.
Posted by Yeah You on April 4, 2014 at 9:33 AM · Report this
43
@42 - no one has said tips will be made illegal. What people are saying on one side is that tips are not a valid model for compensation, while the other side says they are.

If tips aren't a valid model for compensation, and we don't count them as compnesation in a $15 minimum wage, employers will have no choice but to raise prices and get rid of tips. This will allow for no decrease in sales, but income to pay for the wage increase. But it also means that while servers will get $5.68 more in wages, they'll lose their tip income.

Instead, I propose count tips as part of compensation but guarantee no one makes less than $15 per hour. This way the servers now making over $15 an hour because of tips will still be making that, the back of house will get a raise, prices will go up just a little, and small businesses will survive.

The argument basically comes down to guaranteeing a minimum income of $15 counting total comp including tips, raising income for all workers, while preserving small businesses, or mandating a $15 minimum wage across the board, closing small business, and ensuring one group of workers make less while one makes more.

I like the first option, and it achieves the goal of everyone in Seattle earning a living income.
Posted by Meinert on April 4, 2014 at 9:47 AM · Report this
44
@43 I get what you are proposing, I just don't agree. What you guarantee your employees in wages should be separate from what they have to hustle for. A rise in minimum wage isn't going to affect my tipping, and if you take the line off of your credit card slips, I will leave cash. That's what I do in non-tipping cultures. Tipping instead of fair wage is cultural. It also had the tendency to be racist, sexist and ageist.

The position you have taken is a turn off for many of us who used to patronize your businesses. Trust me, we discuss it and we are judging with our dollars. However, I don't think that will hurt your very successful establishments, just like I don't think $15 will. You can still be a champion for your workers and truly taken a progressive business stance. Small business deserves an appropriate phase in to adjust to higher wages, just like workers deserve a living wage.
Posted by Yeah You on April 4, 2014 at 10:36 AM · Report this
45
I can see why one feels as though it's a necessary step for business survival (which is the ultimate question, seeing as how a shuttered restaurant can't maintain it's people by any means), but total compensation absolutely is a commission paid by servers to employers for selling their employers product (ie s the tips for their first $30 in sales per hour). It's being framed as a survival tactic, but it's a conciliatory prize being hedged against a winning $15now campaign, because it gives businesses a a competitive advantage for free: "Everyone ELSE'S labor costs are increasing, but we get to tell servers and bartenders to pay their own wage hike."

It's madness for any of us to think that's not a shitty thing to do. It's divisive. Have you ever seen the service in places where employees don't love and respect the owners? You should. Why not look towards our own people to increase sales instead of looking towards our own people to cut costs? As service workers, our responsibility is to keep our industry prosperous and our brethren well-cared for. If I earn an extra $45 in wages during my grueling 8 hour brunchtending shift, I should feel obliged to to spend an extra $45 at my favorite bars and restaurants. Think of how much of your clientele is industry, and think about whether or not you want to alienate them.

Or from a more self-centered point of view, think about how much some of our best establishments have invested already into the bartenders and servers in the city. Minimum wage for 2010-2014 at, say, 35hrs/week yields a total investment of $81.5k. If, after the law changes, we find that top-tier service workers are unwilling to work for sub-minimum wage, then places with established staff are going to be facing the question of whether that loss is worth the extra $10k per year it would cost to retain them. Maybe it is, maybe it isn't. If I had to get a new random guy off the street for $326 per week or keep the face of my business for the last half-decade for $525 a week, I wouldn't have to think too hard about it.
More...
Posted by alarbus on April 4, 2014 at 12:22 PM · Report this
46
Really has nothing to do with total compensation, but still, what about the people that are making more than min wage but not much more? if you're making $16 an hour because you've put in the time and effort to get raises, are you gonna get a raise too?? or is that kid that's in HS with no skills come in and make a dollar less than you starting out? Personally the whole 15NOW is a too much, too quickly. It will hurt a lot of small businesses, all the wait staff that this is arguing over will be unemployed because the small business they work for will have to close. Only the big business will be open, with their unskilled labor, but they'll be making $15/hour with little to no benefits like they are now, being forced to work off the clock, through their breaks, like they are now. So all in all. Prices in Seattle will go up to accommodate the increase and people will just go somewhere else to do their shopping and eating out. It'll be offices and Starbucks.
Posted by KevR on April 5, 2014 at 5:02 AM · Report this
ilikefood 47
i would like the stranger to publish a list of all small business/restaurant/coffee shop/bar owners in and around capitol hill, and if they vote yay or nay on raising the MW. those that had the guts to vote yay (without requiring tips and meals and insurance count towards the wage increase) will instantly gain the bulk, if not all of my business.
Posted by ilikefood on April 5, 2014 at 5:50 PM · Report this
48
David I would like to know what you have to say about all the small businesses who's staff make little or no tips. Even if total compensation (or at least tip credit) is passed they will still have to pay huge wage increases while business owners like you will not. Thoughts?
Posted by jack chandelier on April 6, 2014 at 6:57 PM · Report this
49
So yeah, it's a given that a $15 minimum wage will decimate the Seattle restaurant business. But no one seems to be asking the basic question of "why should we, collectively as a society, give a shit?" There's many reasons why reducing the number of restaurants in the metro area could be a positive thing, maybe not for the economy, but certainly for the general integrity of our collective unconscious.
Let's first consider the over fetishization of food and eating that seems to have become a mainstay of not just U.S. culture, but of urban culture in particular. Whilst I'll applaud restaurant pioneers like Maria Hines and the like for attempting to raise awareness of where our food comes from and how it was raised/ grown, the reality is restaurants that seek to bring back a true concern and connection to our food sources are the exception right now, not the rule. The fact is that the average Seattle diner is overly concerned about the color of his steak, but if one were to attempt to talk to him about how that animal was treated when it was alive, you would find a very unsympathetic ear. Too many restaurants have gotten by simply by putting the same GMO crap you'd buy at Albertsons on a square plate, doing a little sauce painting with a squeeze bottle (as described by Anthony Bourdain in the seminal classic Kitchen Confidential) and voile! what was $10 dollars worth of food is now $50 worth of so called "fine dining." I can assert this with a certain amount of authority since I spent the better part of my twenties wielding the aforementioned squeeze bottle.
I can't help but role my eyes when FOH staff cry that they might take a pay cut. The standards of service at most urban eateries with so called "professional" servers is just ridiculous, and in essence what this represents is a monetization of the role of servitude, dating way back to when it used to be ok for one person to own another. While this (generally) doesn't happy anymore, the need for one person to feel superior to another persists on, and hence we have "professional" servers. It's simply not enough for us to have someone cook for us and bring us our food and drink. We need someone who will just LOVE to do this for us, as if it's a pleasure. I won't argue that serving isn't hard, I've done it, and it is. But I quit because I found all I was really doing was supporting people's sense of entitlement with my disingenuous smile and overly friendly demeanor. The fact was, if you could afford to dine at any of the restaurants I worked at, you're sense of entitlement was already a fully formed behemoth and didn't need any support from me. Couple this with the fact that the FOH for years has made about double what the BOH makes and it's really hard for me to be sympathetic. The question I pose to readers is does our culture really need such a large work force of people with most of a liberal arts degree who can carry five plates at a time and describe a 100 bottle wine list from memory? Sure, the economy supports it, but the economy also supports blatantly chauvinist pornography. That doesn't make it a good thing that moves our society forward in any way. Servers making less, and cooks making more, could be a good thing. Sure, the level of service will likely suffer, but again, is this really a bad thing that people might have to finish their liberal arts degree and get a real job making a real contribution to society in order to make a decent living?
More...
Posted by RetiredRestauranter on April 6, 2014 at 7:41 PM · Report this
TCLballardwallymont 50
Why so much emphasis on wages (or compensation if you like)?

It isn't how much you make as an absolute number that drives personal economies. You make 40k a year in San Francisco? Fuck, you are scraping by at best. You make 40K a year in Idaho Falls? You're doing just fine. We call this the area's "cost of living" and measure it through common markers such as groceries, housing, taxes, and transport cost for a given area to give us a cost of living index.

Now, does anyone think that the cost of living (all other concerns aside, # of jobs, etc) will not increase rapidly to compensate for the new minimum? Anyone? Bueller? Bueller? Bueller?

I like that the 15now coalition wants to make things better for the lowest paid among us. I wish that they would stop doing so using means unlikely to affect lasting change.

That first paycheck after the increase? Going to be awesome for some folks. The first federal tax season after the increase - not so awesome. The rent increase notices - really not at all awesome. The higher bills for food at the grocery, etc etc.

Wages do not get paid in a vacuum. As soon as this takes effect you will see a directly proportionate rise in the total cost of living index.

Remind me again, who gets hurt the most when an areas CLI goes up? OHH OHHH wait! I know this one!! It's the impoverished!
Posted by TCLballardwallymont on April 10, 2014 at 12:11 AM · Report this
51
People keep quoting the minimum wage increase of 1988 like it's the same thing, when it's far different. In 1988 they brought the minimum wage from below poverty levels up to a national standard. What's on the table now is to increase the highest minimum wage in the nation by 67%, that's a HUGE difference.

As i've stated in other comments pages, I've been a tipped employee for the past 14 years. I work hard, this is my career, and I make a very good living. It's imperative that tips are included in this drastic of a change to the minimum wage otherwise the entire restaurant and bar industry in Seattle is at risk.
Posted by JimR on April 10, 2014 at 3:08 PM · Report this

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