For Immediate Release: April 30, 2015
Contact: Maria Myotte, maria@rocunited.org, 720-352-6153

ROC United Announces Support for Historic Bill to Increase Federal Minimum Wage to $12/Hour and Phase Out Subminimum Wage for Majority Women Tipped Workforce

Raise the Wage Act Demonstrates Impact of ROC Led Campaign Calling for ‘One Fair Wage’

“High Road” Restaurant Employers Commend Bill’s Efforts

Today, Restaurant Opportunities Centers (ROC) United announced its support for the Raise the Wage Act, introduced by U.S. Senator Patty Murray and Representative Bobby Scott. The bill will increase the federal minimum wage to $12 an hour 2020, and phase out the separate, lower minimum wage for workers who earn tips by increasing the tipped minimum wage on a yearly basis till it achieves parity with the general minimum wage. This bill represents an important step forward in the One Fair Wage campaign’s goals of ensuring the dignity of a fair and stable wage for all Americans.

The bill will be particularly impactful for more than 5.3 million Americans who are tipped workers. Under current federal law, these workers – more than two-thirds of whom are women – can be paid a subminimum wage as low as $2.13/hour, the rate at which the federal tipped minimum wage has been frozen for 24 years. This amounts to an annual median income of just $14,596, including tips and before taxes — less than a third of the median income for the average American. As a result, tipped workers are significantly more likely to live in poverty and rely on public-assistance programs to support their families. Tipped restaurant workers — 66% of whom are women —  live in poverty at nearly three times the rate as the rest of the U.S. workforce, and use food stamps at nearly twice the rate. A recent study found that as a result of the full-service restaurant industry’s inadequate wages, nearly half of all full-service restaurant workers require public support programs, costing taxpayers nearly $9.5 billion/year as subsidies to the industry’s poverty wages.

“The status quo for tipped workers is simply unacceptable,” said Saru Jayaraman, co-director of Restaurant Opportunities Centers United. “No employer should force customers to pay the majority of their workers’ wages, nor should any worker be forced to depend on the generosity of strangers for their income. This two-tiered minimum-wage system forces a predominantly female workforce to accept regular harassment just to keep food on the table. All workers — tipped and non tipped — deserve a fair minimum wage. The Raise The Wage Act is a historic step toward ending the unfair two-tiered wage system and ensuring one, fair minimum wage so that all Americans can support themselves and their families.”

The subminimum wage forces women who earn tips to rely on customers, rather than their employers, for their income. This leaves them vulnerable to harassment since refusing to tolerate a customer’s inappropriate behavior can mean losing pay. According to a recent report, 90% of female tipped restaurant workers report experiencing sexual harassment, while the Equal Employment Opportunity Commission has targeted the restaurant industry as the single largest source of sexual harassment claims in the U.S.

“We applaud Senator Murray and Representative Scott’s leadership on fair wages for workers, including tipped workers,” said Meg Fosque, National Policy Director for ROC United. “Raising the minimum wage for tipped workers is fundamental to addressing inequality in our country. When we allow employers to pay tipped workers, mainly women, less than minimum wage, we are writing the gender wage gap into law. Fixing this broken system will be good for American women and their families.”

Seven states, including the entire West Coast and Minnesota, have already instituted one minimum wage for all employees. These increased wages have been good for the restaurant industry and good for the job market. In fact, average per capita restaurant sales in states with one wage surpass the rest of the country by a margin of approximately $17,000 while projected job growth in the industry is 1.5% higher.

“I’m lucky, I’ve been a tipped worker in California, one of the states that doesn’t have a lower wage for tipped workers, for 23 years,” said Hugo Aleman, current server in CA and member of ROC-LA. “It’s not perfect, we’re fighting for a wage increase over here, but I can’t imagine what it’d be like to live in a state where being a server means your employer only has to pay you $2.13 an hour. That’s terrifying. Everyone deserves a fair wage, regardless of what state you live in. I’ve worked at several successful restaurants that pay all their employees at least the minimum wage, it can be done.”

“As a server, I’m surviving on the generosity of strangers which is scary,” said Moira Walsh, ROC member and current server in Rhode Island. “We deal with customers who are expected to pay our wages. I say expected because Lord knows tipping is not required. I live off tips and $2.89 an hour. There are days when I go home with less money than I owe my babysitter and I know I’m not alone. I need a paycheck that is reliable and consistent so that I can put food on the table for my family. A fair living wage would make the necessity a reality.”

“The subminimum wage is not sufficient,” said Lori Zito, member of Restaurants Advancing Industry Standards in Employment (RAISE) and President of Choices Cafe in Miami, Florida. “At Choices Cafe, we have always paid one fair wage, even though it is not mandated because we do not believe that our employees should have to depend on tips to live. As an organic restaurant whose food costs are at least twice as much as restaurants serving conventional food, we are proof that making ethical decisions in aspects of operations can still create a sustainable and successful business model. We support one fair wage — we always have. It’s the right thing to do.”

“We know from experience a minimum wage increase makes great sense for business,” said Paul Saginaw, member of RAISE, and co-founding Partner of Zingerman’s Community of Businesses in Ann Arbor, Michigan. “Since opening Zingerman’s Deli 32 years ago, we’ve grown to nine businesses employing 625 permanent staff with about $50 million in revenues. Paying entry wages our employees can live on has been important for our profitability and our annual compounded growth rate of 10 percent. Raising the minimum wage to $12 by 2020 would help break the cycle of wages holding too many working families in poverty and inject billions into the economy. We support efforts to create a level playing field that encourages employers to move toward raising wages for tipped workers as well.”

American voters already support elimination of the subminimum wage by an overwhelming margin. According to recent national polling, 71% of the public favor eliminating the two-tiered wage system in favor of implementing one minimum wage for all workers. That support remains consistent among Democrats, Republicans and independent voters.

Through the One Fair Wage, ROC United is currently spearheading efforts in several states and D.C. to eliminate the two-tiered wage system and ensure a fair minimum wage for all workers.

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Co-founded by leading workers’ rights advocate Saru Jayaraman (“One of the top 50 most influential people in the restaurant industry” – Nation’s Restaurant News) ROC United has grown to over 13,000 worker-members across 26 cities in the US, winning 15 worker-led campaigns, totaling $8 million in stolen tips and wages.