On Monday, restaurant workers from across New York and organizers with the One Fair Wage campaign will be going to the State Capitol in Albany to push for legislation that would establish an equal minimum wage floor across the board, including for tipped workers in the service industry. Like many others, New York State allows employers in the hospitality industry to pay their workers an hourly minimum wage lower than the state mandated $16 an hour, as long as the wage paid by the employer plus tips meets the minimum. The New York State Department of Labor calls the remainder of the wage made up in this way a “tip credit.” Food service workers can earn as little as $11 with a maximum $5.50 tip credit in New York City.
Senate Bill S415A and Assembly Bill A1200, sponsored by State Senator Robert Jackson and Assemblymember Jessica Gonzalez-Rojas respectively, would establish minimum wage requirements for varied industry workers, commonly known as a one-fair-wage measure. Both bills are currently in committee. According to Jackson and Gonzalez-Rojas, such a measure “will put more money in working New Yorkers’ pockets and help insulate many of our state’s most vulnerable workers from whatever is to come” with a Trump administration whose policies (e.g. tariffs) could raise their costs. They will be joining the event to explain their bills.
Restaurant owners in New York City strongly oppose the move to a one-fair-wage model, with a survey last year of nearly 900 of them finding that 67% claimed they would reduce staff if they had to pay the full minimum, and another 54% said they would consider closing. Data from states where the lower tipped minimum wage has been eliminated – Alaska, Minnesota, Montana, Oregon, Nevada, Washington, and California – does not suggest that it has harmed the industry. Analysis from the Economic Policy Institute has found that one-fair-wage states have stronger restaurant growth than states that have maintained the subminimum wage for tipped workers, both in terms of number of restaurants and total employment.
The tip credit system also presents issues that are not directly related to wages. A 2023 report from ProPublica found that the restaurant industry outpaces all others in terms of wage theft across the state, totaling over $54 million between 2017 and 2021. This accounts for about 25% of all stolen wages in the Empire State over that period. Another EPI report found that tipped restaurant workers are also more likely to experience sexual harassment in states that have a subminimum wage, as “the more dependent workers are on customers to pay their wages, the more they are forced to tolerate abusive behavior from customers.”
Advocates and workers have been seeking Governor Kathy Hochul’s support on the one-fair-wage bill since at least last year, and tried to get her to include the measure in her 2024 budget. She has previously said that she “will review legislation if it passes in both houses of the Legislature.”
