My initial gut reaction was to support it, but I was quite surprised how many servers have come out to say No. I was skeptical about this at first, because I have issue (still do) with how it’s being portrayed in annoying political ads. That restaurant owners would be “forced” to take tips away from servers, etc. I understand that raising prices would likely be one of the outcomes, but I don’t understand why restaurant owners would be “forced” to do anything else.
I would love data points to understand how much of the current wages are tips vs base. What’s the average earnings in the Boston area, and what percent of that is base vs tips?
Realistically, I think people would tip less than before, but I don’t think it will stop completely. It’s also unclear why that necessarily means it will be less than what they used to make (all the “I won’t be able to pay my bills” in the ads) in total. I would love to see data from the cities like L.A. and Chicago that have in fact raised minimum wage for tipped workers, and if these folks feel like they take home less now.
This is really hard, if not nearly impossible, to quantify with any type of statistical clarity or certainty.
In part, because of several factors, including (1) response bias (i.e., that servers will be truthful in how they are reporting their tips); (2) the presence, or lack thereof, of tip pooling; (3) and the variances between different types of tipped hospitality employees (i.e. a bartender will make significantly more than a server at Denny’s, for example).
I cannot speak for the situation in MA, but from my experience, most tipped employees in CA, FL and TX that I am aware of make significantly more than the stated minimum wage, even after accounting for variables like tip pooling and response bias.
Making more than minimum wage is a given, otherwise servers wouldn’t be able to survive in those cities. If there was any way to get aggregate earnings data - which does exist, if even on tax forms - this would be the data that we need to make a strong decision. I’m sure the government are not going to provide this data, no matter how many assurances are given. This also in theory wouldn’t be difficult to do if employers really wanted to look at this. If many restaurants are using actual payroll software, this would be easy to pull and analyze.
The problem here isn’t the availability of data; it’s the accuracy of that data.
Anyone who has worked as a tipped employee, or have experience with a tipped employee, knows that the “reported” tips are never what’s actually received by the employee.
I am not saying that’s right or wrong, just that it is.
Doesn’t mean the data is not worth pulling and analyzing (if someone really asked for it and found a means to do it). If there is fraud going on, but then at least report on what data you have. The accuracy of the data you are tracking is an inherent problem with all data analytics, but it shouldn’t stop someone from at least looking at what we have. It’s the keeping it obfuscated that will be real problem in the long haul. Only on reporting it will someone have any reason to push for more accountability to keeping it accurate.
If on the other hand, what is implied is that the servers are actually making out because businesses are complicit in under-reporting wages than that’s a different issue to tackle, that would still require looking at what gets reported.
the data exists. any private company/analyst/consultant could put it together without breaking a sweat. in private consulting I did exactly that - as restos were contemplating going to the “service included” model. at relatively high end places, my work indicated waitstaff pay would decrease and tipped employees would not be happy. resto owner(s) didn’t think that would happen, but it did - and just about every ‘service included’ model has reverted to the tipped model.
it is the lack of political will to do such analysis that is the stonewalling entity.
state income records could be used.
the IRS already flags ‘tipped workers’ and compares their declare tips vs. others from the same employer and from regional data.
you will see many comments in ‘tipping threads’ about people who prefer to leave cash on the table tips. not reporting cash tips . . . you can get away with some; but go overboard and the IRS will likely wish to have a chat with you.
bottom line to that . . . one can estimate the unreported tip $ value, within a margin of error.
tips included on credit card charges - the employer is required to report those to the IRS. and obtw, it is legal for employers to reduce the tip amount by credit card charges.
I have been tipping in cash since the beginning of time (ok, maybe since I’ve been a young adult and had friends in the service industry who always appreciated cash tips).
from boston.com. interesting that while are few servers who are financially supporting question 5, the are quite a few who’ve contributed to the opposition.
As a non Bostonion I have to point out that there is a huge population of Massachusetts residents west of Boston . Often businesses do not accept plastic or require a minimum amount and some don’t accept tips on plastic. You can say it’s illegal as I have tried but they still do it.
Yeah, I do analysis like this all the time for my company, and would never make decision without looking at key data points like this. It’s crazy that no one has asked for this type of data, or has shared what the data is. Having worked closely with a lot of payroll systems, this is easy to pull as it’s literally reported on W-2s, and would be information we pull all the time for different compensation analysis.
With concerns about accuracy of the data, then who can you blame but the people who are intentionally painting the wrong picture of their earnings? If people are proposing legislation to fix what are perceived inequities in the wages - because this is what the workers and business owners are reporting or sharing - then that’s a problem of their own making.
Let’s take a bartender who gets “tipped” a nice $20 or maybe even a Benjamin for his entire party for a long pour on a 23 yr Pappy Van Winkle (to make the example extreme). That tip is not reported to the restaurant owner officially, but the restaurant owner knows full well that her bartender is skimming off the top on a busy Friday night.
Now, is the owner going to call out her bartender on this? No, because it would do no good. One, there’s no way to prove any of this is going on (unless the owner were to stand next her bartender on each pour, which would be both impractical and ridiculous). And, two, it would actually make for a very disgruntled employee and just a bad work environment, especially poignant if said bartender is otherwise very good at his job.
So in this scenario, it’s best for both parties to keep quiet. The server/bartender, aside from getting phantom tips on long pours, doesn’t have to report it as “reported” wages to the IRS, and the owner gets wage control by keeping the bartender’s wages at a constant (or near constant).
Ever wonder why tipped employees’ minimum wages generally rise at a slower rate than many other non-tipped hospitality workers? Assuming they even get raises, which many do not (and which many never complain about).
So, in the end, who cares what gets reported. It ostensibly remains a constant. A sort of convenient accounting fiction for both employee and employer.
Yes, we all want data. But if the data is fictionalized, do we still call it “data” and if we do consider it data, do we still want it?
Anyone else old enough to remember the simple rule of thumb for tipping: “Triple the tax”? Now I guess it’d be “Quadruple the tax” but still not brain-bending.
This thread is more and more convincing me that the correct vote on this is yes. While I am generally for less intrusive government and would support the interested parties (owners and waitstaff) deciding what a fair wage is there is a huge black hole in this case.
As with other cash businesses there is a possibility of not reporting accurate data, in this case tips. While I don’t believe that waitstaff are any less honest and ethical as other people why should they have an advantage over other workers as far as full reporting is concerned?
The cashier at McDonald’s, who typically does not earn tips, gets 100% of their income reported. How does the owner of a tipped worker establishment even know what the difference is between the tipped MW and the non-tipped MW so they can make up the difference?
If a tipped worker underreports their tips then the owner might have to make up the difference to get them to the non-tipped MW. IMHO if we can’t get the government out of the salary determination completely then we should at least have total transparency by only allowing credit card tipping.
Data will remain fictionalized unless it’s brought to light and scrutinized. I’m not out to get anyone, but just highlighting that key issues around fair pay and wages, benefits, cost-of-living are not ending when this current campaign for this policy ends (regardless of direction). Rather than having each side frame it however they want it - look at the data! It can only improve when it is seen, reviewed, (eventually) scrubbed and reported.
