Today there was a protest on the steps of City Hall by people urging Gov. Cuomo to eliminate the tip credit.
The New York City Hospitality Alliance issued the following statement:
“The data is clear that servers and bartenders who earn tips in New York City make more than the minimum wage – in many cases two and three times the minimum - and the law protects those who don’t.
Eliminating the tip credit means customers will pay higher menu prices at restaurants, resulting in less income for workers when they leave smaller or no tips at all. This major cost increase would lead to fewer good paying jobs and more shuttered storefronts.
Therefore, we urge Governor Cuomo to look past the theatrics of today’s rally and consider the negative impact that eliminating the tip credit would have on small business owners and tipped workers alike.
Furthermore, the truth is that we must protect all employees from harassment whether there is a tipping system or not, and eliminating the tip credit while continuing tipping as suggested by some advocates, does not change the issue. Both the state and city recently enacted expansive anti-sexual harassment laws and our industry looks forward to working with government to implement them. However, let’s not unfairly conflate these serious issues when so much is at stake.”
For questions or comment contact Andrew Rigie, Executive Director, New York City Hospitality Alliance at arigie@theNYCalliance.org.
WHAT IS THE TIP CREDIT?
In 2016 the New York State Legislature set the tipped wage at 2/3 of the full minimum wage, the remaining 1/3 is the tip credit. This allows employers who rely on razor-thin profit margins to save on operations and allows employees the opportunity to earn more money in tips. If an employee’s tipped wage and tips ever equal less than the minimum wage, the employer is required by law to make up the difference.