Should the US raise the federal minimum wage?

[grumbler]

That's a good first start for change.  Tips shouldn't subsidize restaurants.

They don't.

In theory that is true.  But in practice, all too often, the house takes a percentage of the tip pool.

Really? How often is that?

All too often I have no idea

FYPFY

[crazy canuck]

That's a good first start for change.  Tips shouldn't subsidize restaurants.

They don't.

In theory that is true.  But in practice, all too often, the house takes a percentage of the tip pool.

Really? How often is that?

All too often I have no idea

FYPFY

Not quite.  I don't know the precise number but I do know it happens enough for the employment standards branch here to have launched an investigation to try to crack down on the practice.  So I think I will stick to my much more accurate response of all too often.

[Admiral Yi]

Even when the house does not take a cut, tips do subsidise restaurants as tipping culture allows restaurants to get away with paying their employees less.

That's not a subsidy.  Any more than having to pay for your own transportation and parking is a subsidy.

It's only a subsidy if the restaurant receives additional money on top of what it gets from its customers.

[crazy canuck]

Even when the house does not take a cut, tips do subsidise restaurants as tipping culture allows restaurants to get away with paying their employees less.

That's not a subsidy.  Any more than having to pay for your own transportation and parking is a subsidy.

It's only a subsidy if the restaurant receives additional money on top of what it gets from its customers.

I agree that minimum wage laws which permit lower wages is not a direct subsidy in the same way as preferential tax treatment would be a subsidy.  But I can see the argument that it is an indirect subsidy as the state is allowing that sector to have lower operating costs.

[Eddie Teach]

Even when the house does not take a cut, tips do subsidise restaurants as tipping culture allows restaurants to get away with paying their employees less.

That's not a subsidy.  Any more than having to pay for your own transportation and parking is a subsidy.

It's only a subsidy if the restaurant receives additional money on top of what it gets from its customers.

Tipping adds to the price of the meal. The restaurant can't receive this money directly, but it still benefits from cheaper labor as a result.

[sbr]

There's a separate minimum wage for tipped positions.  Currently $2.13 I believe.

That's a minimum hourly wage that can be paid as long as tips bring the employee's total pay to at least the real minimum wage.

[Tonitrus]

That's a good first start for change.  Tips shouldn't subsidize restaurants.

They don't.

Tips simply shouldn't be a factor in regards to laws on minimum wage.  Better?

[MadImmortalMan]

Let the states raise their minimum wages.

Yeah.

States like New York might be able to handle a $15/hour rate across the board, but this will cause some serious pain in places like Mississippi, Arkansas, etc.

Lots of the states where that makes sense already do so.

[Zanza]

Let the states raise their minimum wages.

that.

It's up to the States to do it, not the Federal.  Then people will move to States they feel better in, if it really makes a difference.

Are minimum wage earners actually mobile enough to just move to a different state in order to seek better economic opportunities?

[Josquius]

Yeah... The people will move to where the jobs are thing just doesn't apply for most

[Admiral Yi]

Tipping adds to the price of the meal. The restaurant can't receive this money directly, but it still benefits from cheaper labor as a result.

How is that?  Currently the restaurant gets $20 (let's say) from you for the food, drink, and facilities, and you pay $4 directly to the waiter.  It would make no difference to the restaurant if you paid them $24 and they paid $4 to the waiter.

[Martinus]

Tipping adds to the price of the meal. The restaurant can't receive this money directly, but it still benefits from cheaper labor as a result.

How is that?  Currently the restaurant gets $20 (let's say) from you for the food, drink, and facilities, and you pay $4 directly to the waiter.  It would make no difference to the restaurant if you paid them $24 and they paid $4 to the waiter.

Well, you are exactly agreeing with what Peter Wiggin said.

If tipping is seen as mandatory (due to cultural, peer pressure etc. reasons), then it is effectively an increase of the price and it would be more honest to just add it to the price listed in the menu and have the restaurant owner increase the salary of the staff by a corresponding amount. This way the outcome will be more fair, as the salary of the staff would not depend on arbitrary opinion of the customer, often based on non-service-or-quality-related factors, such as "was the waitress pretty". And it would also allow for a more fair split of the benefit between individual staff members. I think it also creates a healthier work environment, as it reduces a potential hostility between the server and the customer ("that asshole left no tip") etc. Of course, some will say that the quality of service will fall as a result but I disagree - I have been to restaurants in many countries with no (mandatory) tipping culture, and well paid waiters were nonetheless very polite and helpful.

If tipping is not mandatory and is seen as something extra for an excellent, above average service, then the server cannot rely on it as a part of his or her salary, and consequently needs to be compensated better by the employer

[Admiral Yi]

Where did we agree?  The part where he said the restaurant benefits and I said it makes no difference?

[Martinus]

I think the tipping culture really works in (short term) favour of one party - the employer - as it follows the classic divide et impera principle, by setting (otherwise) fairly common interests of the server, other staff members and the customer (have a good experience) at odds with each other, thus effectively alleviating the employer's/restaurant owner's liability for delivering that to all parties involved (by paying its employees well and delivering good value for money to a customer).

[Eddie Teach]

Tipping adds to the price of the meal. The restaurant can't receive this money directly, but it still benefits from cheaper labor as a result.

How is that?  Currently the restaurant gets $20 (let's say) from you for the food, drink, and facilities, and you pay $4 directly to the waiter.  It would make no difference to the restaurant if you paid them $24 and they paid $4 to the waiter.

Sure, but why are you giving the restaurant $24 for a $20 meal?