Latest news with #OneFairWage
Los Angeles Times
7 days ago
- Business
- Los Angeles Times
Labor groups, officials push for a minimum wage of at least $25 an hour in L.A. County
Labor advocates and some elected officials are calling on Los Angeles County to adopt a minimum wage of at least $25 an hour. On Monday about 150 workers, labor leaders, Democratic party officials and loyal donors gathered at private tables reserved in the back of Wally's Wine & Spirits in Santa Monica to launch a new effort to raise the minimum hourly wage in L.A. County to $25 — or higher. Amid the tinkle of glassware and clang of cutlery, Saru Jayaraman, an L.A. attorney and president of One Fair Wage, a national coalition pushing to raise wages in the service sector, emphasized the urgency of addressing a steep increase in the cost of living. 'We need bold, proactive action,' Jayaraman said. 'That's the only way people will be able to afford to stay in L.A. County.' A person living in L.A. County and working full-time in a household without children must earn about $28 an hour in order to cover basics of rent, transportation and food, Jayaraman said, citing MIT's living wage calculator. The hourly minimum wage in Los Angeles is $17.28, 78 cents higher than the state's. No wage proposal has yet been submitted to the county, Jayaraman said, but labor groups plan to work with the L.A. County Board of Supervisors to hash out the specifics. The campaign is sure to face staunch resistance from business groups. It follows L.A. City Council's approval of wage boosts for airport and hotel workers to $30 an hour by 2028. Hotels and tourism industry groups have continued to fight the new ordinance, filing paperwork last week to force a citywide vote to overturn it. Business leaders who opposed the tourism wage hike had warned that Southern California — like other tourism hotspots across the U.S. — is already facing a slowdown in international travel due to trade war hostilities and deportation threats. To manage the mounting cost of labor, hotels will be forced close restaurants or other small businesses on their premises — and in some cases, shut down entirely, they said. The coalition of businesses that is seeking to overturn the wage — the L.A. Alliance for Tourism, Jobs and Progress — will need to gather about 93,000 signatures within the next few weeks in order to qualify the measure for the ballot in an upcoming election. L.A. City Councilmember Eunisses Hernandez, who backed the tourism wage boost, said unions were bracing for a fight in the coming weeks and months. 'Corporations and businesses are only going to go more on the attack and do everything in their power to reverse these policies,' she said. 'We are talking about workers being able to buy food, and live in the city they work in.' The campaign to boost the minimum wage has the backing of L.A. County Supervisor Holly Mitchell, who said at the event that she often hears from her constituents that they are being priced out. 'What it costs to just survive in Los Angeles County — it takes away my breath every day,' Mitchell said. Mitchell supports an across-the-board minimum wage increase, rather than efforts to raise industry-specific wages. 'This might not be a popular thing to say, but we don't help ourselves when we have a piecemeal sector-by-sector approach,' Mitchell said. Besides tourism workers, healthcare and fast food workers have also lobbied for improved pay at the state or local level. In unincorporated areas of L.A. County, the minimum wage is $17.81. The federal minimum wage is $7.25 per hour.
Yahoo
01-05-2025
- Business
- Yahoo
Another DC restaurant closing down, blaming controversial 'Initiative 82'
The Brief Another popular restaurant in D.C. is closing down, saying they've struggled under D.C.'s Initiative 82. The legislation raised the minimum wage for tipped workers from just over $5 an hour to currently $10 an hour. Despite being passed overwhelmingly by D.C. residents, Initiative 82 has been cited by several popular restaurants recently as a factor in their closures. WASHINGTON - Another popular D.C. restaurant just announced its closing, blaming a controversial ballot initiative as one of the reasons. Haikan will have it's last day on Saturday after a decade on V St. in the Shaw neighborhood. The owners told FOX 5 they had no comment beyond the statement posted to their social media, which reads in part, "after almost 10 years in Shaw, we've made the difficult decision to close our beloved Haikan. The challenges of food costs, Initiative 82 and the economic climate in the city brought us to this decision." The backstory Initiative 82 has been cited by several popular restaurants recently as a factor in their closures. The legislation was passed overwhelmingly by D.C. voters — twice 1 a few years ago. It raised the minimum wage for tipped workers from just over $5 an hour to currently $10 an hour. In July, it will increase to $12 an hour and keep increasing until it reaches $17.50 an hour in 2027. The Restaurant Association of Metropolitan Washington has been vocal in its opposition of Initiative 82, even asking D.C. Council to repeal it recently. But when speaking to several council members, it doesn't appear a full repeal would be on the table. Councilmember Anita Bonds told FOX 5 she does not support a repeal, but would potentially consider a freeze - which means keeping the minimum wage at $10 per hour, while they figure out what the best way forward is. READ MORE: DC restaurant 'Sticky Rice' blames Initiative 82 as it prepares to close down Those in favor of I-82 point out that restaurants often close for a variety of reasons and this blame game is simply an easy way out. Local perspective FOX 5 spoke to a server and bartender, Blake Vincent, who is also part of the group One Fair Wage. They helped draft the legislation. Vincent said since last year, his bar has seen a roughly 5 to 10 percent increase in customers and a repeal of I-82 would be horrendous. "That scares me because the people I work with depend on a living wage in order to live, to pay their rent," Vincent said. "We live in D.C. It's very high rent. I'm able to pay my rent because of the wage I make with tips on top of it." One Fair Wage pointed to more than 30 restaurants opening their doors in D.C. since the start of the year, more than a dozen in April alone. PREVIOUS COVERAGE: Here's how Initiative 82 could transform DC's restaurant industry Other residents who spoke with FOX 5 also seemed to support the minimum wage increase. "Anytime you talk about tipping, it's going to be hot topic," said Steven Freeman. "But $5 an hour for people who serve your food and all that, in today's climate, today's economy, that's not enough can't live off of it so you've got to find a balance." "You know, if the food is good, and everything is working well in the restaurant, there's no reason for it shut down," said Matt Zakrzewski. "There's probably a way money can be moved around to pay these people the money they deserve." "I just think that people need to be paid a living wage," said Melissa Bell. "They can't continue to pay what they have paid in the past, everything is going up and it's only fair that you pay your workers enough." What they're saying Below is a statement from the Office of the Deputy Mayor for Planning and Economic Development: "We recognize the challenges that many DC businesses are facing. The District is proud to have robust programs to support local retail businesses, but we also know we must also advance a growth agenda that makes it easier to do business here, particularly in the restaurant industry. We will continue to work with the Council on that agenda and legislative proposals as Mayor Bowser advances her FY26 budget." READ MORE: DC restaurants brace as 'Initiative 82,' eliminating tipped wage system, goes into effect Below is a statement from RAMW President and CEO, Shawn Townsend: "The closure of Haikan, a cherished ramen spot in Shaw, marks yet another significant loss for our city's dining scene. After nearly a decade of serving the community, Haikan's decision to shut its doors underscores the mounting challenges faced by independent restaurants in Washington, D.C. While factors like rising food & rent costs and a shifting economic climate play roles, the impact of Initiative 82 cannot be overlooked. This policy, which eliminates the tip credit, has introduced financial strains that many small businesses find insurmountable. As labor costs escalate, restaurants are forced to make difficult decisions, often resulting in reduced staff hours, increased menu prices, or, as in Haikan's case, complete closure. It's imperative for our city leaders to recognize the unintended consequences of Initiative 82. We urge the D.C. Council to reevaluate this policy and consider measures that support both fair wages for workers and the sustainability of our local businesses. The preservation of D.C.'s unique culinary landscape depends on balanced solutions that address the needs of all stakeholders."
Yahoo
03-04-2025
- Business
- Yahoo
New report finds tipping rates at a six-year low in Illinois
A new report supports ending subminimum wages in Illinois. The report, done by One Fair Wage, found financial stability for tipped restaurant workers is coming harder and harder to live off of. Here's what to know about the report. One Fair Wage is a nonprofit organization with the goal to end subminimum wage, or wages for tipped workers below the state mandated minimum wages, nationally. One Fair Wage joined SIEU in the state capital to rally to raise the minimum wage for senior healthcare workers. The focus of the rally held on March 18 surrounded minimum wage workers in the senior healthcare industry and Senate Bill 120, sponsored by State Sen. Celina Villanueva, D-Chicago, to raise the minimum wage for senior healthcare workers from $18 to $20 an hour. The report released by OFW in April first highlights annual tipping rate drops, average annual earnings made by tipped employees and the impacts of cost of living increases on the dining industry. According to OFW, analytics and report information drew on data from Federal Labor Statistics, payroll data from ADP and Toast and firsthand accounts from Illinois workers and employers. The report highlights how tipped workers, the majority of whom are women and people of color, are seeing their wages and financial stability collapse under the weight of an outdated subminimum wage system. In the state, the subminimum wage for tipped workers in Illinois is still just $9 an hour compared to the $15 minimum for other workers in the state. Over 198,000 tipped workers go to their jobs on the daily basis in Illinois, for a median income of $16,733 a year, including tips. To put that in perspective, according to the 2025 poverty guidelines, that income is 100% under the federal poverty line for a household of one. One long term impact of subminimum wage not adjusting with the times is burnout from employees leaving the workforce, and the signs are already visible. Now hiring stamped across doors to restaurants, a demand for servers and shift workers who are increasingly hard to find to fill positions. More: Accessing local journalism is even easier with the State Journal-Register app According to the report, Chicago, which is a fair wage city, research comparing fair-wage states to subminimum-wage states shows that fair-wage states have maintained strong growth rates in the number of restaurant establishments and workers. California, for example, has experienced a 12.9 percent increase in small business restaurants compared to a 5.4 percent increase in small business restaurants in Illinois from January 2020 to February 2022. The US Bureau of Labor Statistics data shows in the short time Chicago and Washington, D.C. have started raising tipped workers' wages, the number of positions in restaurants and establishments have remained consistently employed. The Illinois Restaurant Association has announced its opposition to the legislation in Illinois and disagrees that it will increase pay for tipped workers. In a statement from 2024 when a state bill ending subminimum wage was first filed, the association said the bill will do "more harm than good." "These changes will lead to job cuts, an increase in labor costs, and ultimately force restaurant owners to make difficult decisions that will negatively impact their workers and result in higher prices for customers," IRA said. A full copy of the report can be found at Claire Grant writes about business, growth and development and other news topics for The State Journal-Register. She can be reached at CLGrant@ and on X (Formerly known as Twitter): @Claire_Granted This article originally appeared on State Journal-Register: New report finds tipping rates at a six-year low in Illinois
Yahoo
01-03-2025
- Business
- Yahoo
Michigan's last-minute pay law shows the fight over tips and wages is getting more complicated
Michigan lawmakers brokered an eleventh-hour deal last week resolving a seven-year fight over what tip earners get paid. But the compromise wasn't reached until 12 hours after the deadline, and advocates now say workers should get paid for the delay. The reason for that is complicated, and it caps the latest skirmish in a nationwide battle over minimum wages and tips that experts expect to grind on — in ever more byzantine ways. 'There's conflicting interests, and the difficulty is negotiating and figuring out who has the power,' said Michael Lynn, a professor of consumer behavior and marketing at Cornell University. 'The power is the restaurant industry, and that's why federal law hasn't changed.' All parties appear dug in on the issue, which the ongoing fight against inflation has magnified. Labor advocates and many Democrats want workers to earn higher wages and rely less on gratuities. Business groups and many Republicans want to keep payroll costs and menu prices down. Consumers want to be nagged less to tip. But for now, Washington doesn't look eager to mediate. President Donald Trump has called the federal minimum wage of $7.25 an hour, last raised by Congress in 2009, 'a very low number' but hasn't committed to raising it. Last month, Treasury Secretary Scott Bessent ruled out a nationwide hike, saying it was 'more of a statewide' issue. That leaves intact a convoluted patchwork of state and municipal pay laws that continues to evolve, even as Trump promises to scrap taxes on tips and overtime. A White House spokesperson didn't respond to a request for comment. The Michigan compromise boosts tip earners' base pay to $4.74 an hour from $4.01 previously, rising to 50% of the state's standard minimum wage by 2031. The rate for nontipped employees, which the law bumped to $12.48 from $10.56, will hit $15 by 2027. The measure, whose details voters never got to weigh in on, is a scaled-back version of a ballot measure they were set to consider in 2018. The proposal would have abolished the state's so-called 'subminimum' wage, a common setup also known as a 'tip credit' that lets employers pay tip earners less but requires them to fill in the gap whenever gratuities fall short of the standard pay floor. But Republicans pre-emptively passed those changes and then, in a lame-duck session, sharply curtailed them, which lawmakers spent the next six years arguing over. Finally in 2024, the Michigan Supreme Court reinstated the original law, which called for gradually phasing out the subminimum wage. Last week's bipartisan deal — which instead preserves it — coalesced as the clock ticked down on a midnight deadline. Democratic Gov. Gretchen Whitmer signed it about 12 hours later. One Fair Wage, an advocacy group pushing for higher base pay and an end to subminimum rates nationwide, says that means the earlier law was in force for half a day and employers should pay up. 'Any worker who has worked since midnight is legally owed this higher wage,' the group said in a statement shortly before Whitmer's signature. One Fair Wage said it's offering legal services to anyone affected. Still following along? The complex design of Michigan's updated pay system, the horse-trading it took to get there, and the lingering dissatisfaction that followed aren't unique to the state. 'There is no solution that satisfies everybody,' Lynn said. In November, Arizona voters rejected a proposal backed by restaurants that would have slashed tip earners' base pay once gratuities brought their overall hourly income to at least $2 more than the state minimum wage. Activists including One Fair Wage had criticized the measure as deliberately confusing to voters. In both states — as in others where policymakers have sought to raise pay for tipped workers, phase out subminimums, or both — employers warned higher labor costs would demolish already thin profit margins. Paul Andoni, who owns Shield's Pizza in Troy, Michigan, said paying his staff the $5.99 an hour mandated in the original bill would have cost an additional $90,000 a year, forcing him to raise menu prices by 20%-30%. 'I just don't have a slush fund sitting there that I can go raid to pay for this,' Andoni said. 'I have to get it from the customers.' The National Restaurant Association has long argued that 'servers, customers, and restaurant owners all benefit from the tip credit. It maximizes server earnings, allows operators to hire ample waitstaff, and keeps menu prices affordable.' Tip earners themselves are hardly sold on doing away with the two-tiered system. Some say guests would tip less if they knew workers were earning more, or else steer clear altogether in the face of higher prices. 'Customers won't come in and buy a burger for $18,' said Megan Hendrien, a server at Shield's who estimated she regularly makes more than $20 an hour in tips. There's some basis for these concerns. Gratuities have been relatively anemic in recent years. The combination of shifting pay laws and competition for workers has led many restaurants to boost base pay, with operators increasingly making up for customers' crummy tips. As service-sector employers grapple with these and other costs, menu price hikes to offset them have spurred consumer rebellions. Washington, D.C., is in the midst of phasing out its subminimum wage. Voters took two election cycles to agree on that move, passing it in 2022 after rejecting it four years earlier. The city's tipped rate currently stands at $10 an hour and will match the standard one, now set at $17, by 2027. D.C.'s restaurant industry says the hikes have already forced cuts to its workforce, which it said declined by 3% in 2024 from the year before. In a survey by the reservation platform OpenTable, more than half of area establishments reported reducing employment. On the other hand, Lynn said, tip levels haven't changed much in states that have eliminated tip credits. 'In California, they're still tipping in that 15%-20% range,' he said. At any rate, One Fair Wage President Saru Jayaraman says the piecemeal status quo is unfair and unsustainable. 'What we need is for everybody, small and big business, to have a level playing field,' she said. 'Then the consumer isn't bearing the burden of paying the worker's wage. They're actually doing what they think their tip is doing, which is giving the worker a bonus on top.' But subminimum pay doesn't appear to be going away anytime soon. In addition to sticking around in Michigan, it was upheld by Massachusetts voters who rejected an effort in November to replace it with a system for distributing tips evenly among workers. Only seven states — Alaska, California, Minnesota, Montana, Nevada, Oregon and Washington — have replaced tipped wages with universal pay floors, with gratuities as gravy on top. And while 30 states have raised their minimum wages above the federal pay floor, 20 still haven't. Of those, all but one backed Trump. So far, the president has kept his emphasis on cutting taxes on various forms of income, rather than mandating higher pay. While restaurant workers told NBC News during the campaign that they'd welcome any tax savings on tips, the idea generally ranked as a low priority. 'Two-thirds of tipped workers don't even earn enough to pay federal income tax,' Jayaraman said. Lynn foresees eliminating taxes on tips as benefiting high-earning service workers, while 'the really poor person who's working for tips is going to see a much smaller reduction in their tax bill.' Other critics have said the policy would help employers save money on payroll, taxes or both, encouraging them to shift more workers into tipped roles and ramp up requests that customers kick in gratuities. For now, some servers like Hendrien say they're wary of any changes that could threaten the tips they rely on — posing a challenge to activists like Jayaraman who argue a simpler alternative would leave them better off. 'I love the idea of the no taxing on tips if we were to get the tips,' Hendrien said, 'but at this point, if we're not getting our tips, what's the point of the no tax?' This article was originally published on
NBC News
01-03-2025
- Business
- NBC News
Michigan's last-minute pay law shows the fight over tips and wages is getting more complicated
Michigan lawmakers brokered an eleventh-hour deal last week resolving a seven-year fight over what tip earners get paid. But the compromise wasn't reached until 12 hours after the deadline, and advocates now say workers should get paid for the delay. The reason for that is complicated, and it caps the latest skirmish in a nationwide battle over minimum wages and tips that experts expect to grind on — in ever more byzantine ways. 'There's conflicting interests, and the difficulty is negotiating and figuring out who has the power,' said Michael Lynn, a professor of consumer behavior and marketing at Cornell University. 'The power is the restaurant industry, and that's why federal law hasn't changed.' All parties appear dug in on the issue, which the ongoing fight against inflation has magnified. Labor advocates and many Democrats want workers to earn higher wages and rely less on gratuities. Business groups and many Republicans want to keep payroll costs and menu prices down. Consumers want to be nagged less to tip. But for now, Washington doesn't look eager to mediate. States decide President Donald Trump has called the federal minimum wage of $7.25 an hour, last raised by Congress in 2009, 'a very low number' but hasn't committed to raising it. Last month, Treasury Secretary Scott Bessent ruled out a nationwide hike, saying it was 'more of a statewide' issue. That leaves intact a convoluted patchwork of state and municipal pay laws that continues to evolve, even as Trump promises to scrap taxes on tips and overtime. A White House spokesperson didn't respond to a request for comment. The Michigan compromise boosts tip earners' base pay to $4.74 an hour from $4.01 previously, rising to 50% of the state's standard minimum wage by 2031. The rate for nontipped employees, which the law bumped to $12.48 from $10.56, will hit $15 by 2027. The measure, whose details voters never got to weigh in on, is a scaled-back version of a ballot measure they were set to consider in 2018. The proposal would have abolished the state's so-called 'subminimum' wage, a common setup also known as a 'tip credit' that lets employers pay tip earners less but requires them to fill in the gap whenever gratuities fall short of the standard pay floor. But Republicans pre-emptively passed those changes and then, in a lame-duck session, sharply curtailed them, which lawmakers spent the next six years arguing over. Finally in 2024, the Michigan Supreme Court reinstated the original law, which called for gradually phasing out the subminimum wage. Last week's bipartisan deal — which instead preserves it — coalesced as the clock ticked down on a midnight deadline. Democratic Gov. Gretchen Whitmer signed it about 12 hours later. One Fair Wage, an advocacy group pushing for higher base pay and an end to subminimum rates nationwide, says that means the earlier law was in force for half a day and employers should pay up. 'Any worker who has worked since midnight is legally owed this higher wage,' the group said in a statement shortly before Whitmer's signature. One Fair Wage said it's offering legal services to anyone affected. Still following along? The complex design of Michigan's updated pay system, the horse-trading it took to get there, and the lingering dissatisfaction that followed aren't unique to the state. 'There is no solution that satisfies everybody,' Lynn said. In November, Arizona voters rejected a proposal backed by restaurants that would have slashed tip earners' base pay once gratuities brought their overall hourly income to at least $2 more than the state minimum wage. Activists including One Fair Wage had criticized the measure as deliberately confusing to voters. In both states — as in others where policymakers have sought to raise pay for tipped workers, phase out subminimums, or both — employers warned higher labor costs would demolish already thin profit margins. Paul Andoni, who owns Shield's Pizza in Troy, Michigan, said paying his staff the $5.99 an hour mandated in the original bill would have cost an additional $90,000 a year, forcing him to raise menu prices by 20%-30%. 'I just don't have a slush fund sitting there that I can go raid to pay for this,' Andoni said. 'I have to get it from the customers.' The National Restaurant Association has long argued that 'servers, customers, and restaurant owners all benefit from the tip credit. It maximizes server earnings, allows operators to hire ample waitstaff, and keeps menu prices affordable.' Servers' wants and worries Tip earners themselves are hardly sold on doing away with the two-tiered system. Some say guests would tip less if they knew workers were earning more, or else steer clear altogether in the face of higher prices. 'Customers won't come in and buy a burger for $18,' said Megan Hendrien, a server at Shield's who estimated she regularly makes more than $20 an hour in tips. There's some basis for these concerns. Gratuities have been relatively anemic in recent years. The combination of shifting pay laws and competition for workers has led many restaurants to boost base pay, with operators increasingly making up for customers' crummy tips. As service-sector employers grapple with these and other costs, menu price hikes to offset them have spurred consumer rebellions. Washington, D.C., is in the midst of phasing out its subminimum wage. Voters took two election cycles to agree on that move, passing it in 2022 after rejecting it four years earlier. The city's tipped rate currently stands at $10 an hour and will match the standard one, now set at $17, by 2027. D.C.'s restaurant industry says the hikes have already forced cuts to its workforce, which it said declined by 3% in 2024 from the year before. In a survey by the reservation platform OpenTable, more than half of area establishments reported reducing employment. On the other hand, Lynn said, tip levels haven't changed much in states that have eliminated tip credits. 'In California, they're still tipping in that 15%-20% range,' he said. At any rate, One Fair Wage President Saru Jayaraman says the piecemeal status quo is unfair and unsustainable. 'What we need is for everybody, small and big business, to have a level playing field,' she said. 'Then the consumer isn't bearing the burden of paying the worker's wage. They're actually doing what they think their tip is doing, which is giving the worker a bonus on top.' Status quo with a side of tax cuts But subminimum pay doesn't appear to be going away anytime soon. In addition to sticking around in Michigan, it was upheld by Massachusetts voters who rejected an effort in November to replace it with a system for distributing tips evenly among workers. Only seven states — Alaska, California, Minnesota, Montana, Nevada, Oregon and Washington — have replaced tipped wages with universal pay floors, with gratuities as gravy on top. And while 30 states have raised their minimum wages above the federal pay floor, 20 still haven't. Of those, all but one backed Trump. So far, the president has kept his emphasis on cutting taxes on various forms of income, rather than mandating higher pay. While restaurant workers told NBC News during the campaign that they'd welcome any tax savings on tips, the idea generally ranked as a low priority. 'Two-thirds of tipped workers don't even earn enough to pay federal income tax,' Jayaraman said. Lynn foresees eliminating taxes on tips as benefiting high-earning service workers, while 'the really poor person who's working for tips is going to see a much smaller reduction in their tax bill.' Other critics have said the policy would help employers save money on payroll, taxes or both, encouraging them to shift more workers into tipped roles and ramp up requests that customers kick in gratuities. For now, some servers like Hendrien say they're wary of any changes that could threaten the tips they rely on — posing a challenge to activists like Jayaraman who argue a simpler alternative would leave them better off.
