Tip-based Wage System has Racial, Gendered Implications

By Anusha Ravi

Until 2014, tipped workers were excluded from the District of Columbia’s paid sick days law. This omission has since been remedied, but tipped workers around the country remain uniquely disadvantaged; this is especially true for women and people of color. At a recent event by the Public Welfare Foundation (PWF), Restaurant Opportunities Center founder Saru Jayaraman discussed these and other topics in her new book, Forked: A New Standard for American Dining.

Forked features the stories of high-road employers who have implemented job quality standards for their restaurant workers, including a fair wage, paid sick days, predictable scheduling, paid vacation, and/or paid family leave. Unfortunately, such standards are far from the industry norm. Jayaraman refers to these employers as “on the high road to profitability”; by employing people in a fair, sustainable manner, these businesses reap the benefits of happier, healthier employees.

Through the process of collecting restaurant owners' stories for Forked, Jayaraman helped spur significant change in the restaurant industry before the book was even published. Restauranteur Danny Meyer’s influential decision to eliminate tipping and provide one wage to both tipped and untipped workers at two of his restaurant groups was driven, in part, by his conversations with Jayaraman.

Forked argues for eliminating the two-tier wage system, which provides tipped workers a minimum wage of $2.13 per hour and forces them to rely primarily on tips for wages. Providing historical context, Jayaraman explained that the original tipped workers were former slaves, whose labor was deemed valueless by slave-owners and subsequent "employers". These workers received nothing for their work; they depended on tips, which were provided inconsistently (and at the whim) of those extracting their labor. This devaluation of certain types of labor—as well as certain workers—continues today, and women of color remain disproportionately disadvantaged. Jayaraman noted that tipped female restaurant workers are two times more likely to be sexually harassed than their counterparts in states with one standard wage. She attributed this phenomenon in part to pressure that tipped female restaurant workers felt to sexualize their appearance in order to receive increased tips. Because this system is accepted and encouraged within the tipped wage industry, Jayaraman said that tipped workers find it hard to speak out against harassment, especially when they are financially dependent on associated tips.

In addition to Jayaraman, the event featured a D.C. employer who has led the way on fair labor practices. Imar Hutchins, owner of the Florida Avenue Grill since 2005, said he purchased the restaurant, in part, because he wanted to make policies more equitable for the workers there. When Hutchins took over, he asked himself: “Can a restaurant … be healthy [for customers] if it’s not healthy for the people that work there?” He quickly moved to raise wages, institute paid sick days and paid vacation, and provide career advancement opportunities for the Grill’s workers. Over the 11 years since, Hutchins has seen improved worker productivity and retention; however, he emphasized the importance of legislation to make these changes easier for employers. “It is hard to expect employers to take the high road because they feel they will be at a competitive disadvantage,” he explained. “But if these changes were legislated, it would be easier to both enact and implement a higher wage.”