ST. PAUL, Minn. — Republican lawmakers pushed Monday to allow employers to pay their tipped workers lower wages by counting tips in their wages, amid concerns that a higher minimum wage in cities like Minneapolis is putting strain on restaurants and bars.
The so-called tip credit is a familiar proposal in Minnesota, but the gradual increase of the minimum wage in Minneapolis to $15 hourly by 2022 — and a similar proposal in St. Paul — has increased the pressure at the Legislature.
A House committee debated a measure Monday that would cap tipped workers' wages at the current rate of $9.65 hourly. That only takes effect if they make an average of $14 hourly once tips are counted or $12 if they work at smaller restaurants and bars.
Jennifer Schellenberg, President at Restaurant Workers of America, said rising minimum wage — without a tip credit — could lead more restaurants to scrap tableside service in place of computer tablets and food runners if owners can't make enough money. She was joined by a dozen supporters from various Twin Cities restaurants who sported buttons reading "Save the tip" pinned to their black shirts. The organization describes itself as an advocacy group for restaurant employees.
Rep. Joe McDonald, a Republican from Delano, said his bill is in response to their concerns.
"It's not about freezing people's wages," he said. "It's about preserving their jobs, preserving their way of life."
But opponents say they need to protect workers' wages.
Minnesota AFL-CIO President Bill McCarthy told lawmakers that some tipped workers would struggle to earn a living without the safety that comes from the full minimum wage, especially during slow times.
He and other Democrats also said the bill undercuts certain local authorities in setting their own wage minimums.