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Impact of the $15 Seattle minimum wage on restaurants?


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#1 Rail Paul

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Posted 02 May 2014 - 01:44 AM

The NY Times has an article about the Seattle mayor's plan to raise the minimum wage for all employees to $15 an hour. The proposal, which would lead to the highest local rate (Washington State already has the highest state rate at $9.32) in a series of steps. In an unusual move, tipped workers would be included in the program.

 

States and municipalities often carve out an exemption for tipped employees, allowing an often much lower minimum wage.  This would seem to have a potentially significant impact on small restaurants, or places with brigades of bus attendants, dish washers, bar backs, etc who may have a modest claim on tip pools, etc.

 

 

The result, in an agreement reached late Wednesday, with 21 of the 24 members supporting the plan, he said, was a two-tiered minimum-wage structure. Employers with more than 500 workers — no matter where those workers are around the nation — would move on a faster track toward $15 than smaller employers. Tips and employer-paid health care benefits also would be factored in getting to the $15 level for smaller companies, at least in the earlier years of the plan.

The result is a disparity, at least in the rate of pay increases, if not the final destination: Some workers would get to $15 an hour as early as 2017, with a cost-of-living adjustment after that tied to the Consumer Price Index, while other workers, at smaller companies, would not see $15 until 2021. Washington already has the highest statewide minimum wage in the nation, at $9.32.

 

Various factions are sparring over whether to put the move on the ballot, who is included in the fast track increase and who isn't, etc.

 

NY Times:

 

http://www.nytimes.c...&pgtype=article


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#2 tighe

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Posted 02 May 2014 - 06:15 AM

AKA...the suburban restaurant stimulus package.  I look forward to Seattle restaurateurs opening outposts in my 'hood!


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#3 Rail Paul

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Posted 04 May 2014 - 07:06 PM

The Star-Ledger has a repeat of a McClatchy article following up on this story.

 

They note that waitstaff in higher end restaurants are lining up against the increase, while waitstaff in many other places favor the increase. One woman, working in an "expense account" restaurant observes she averages about $45 an hour with tips. In contrast, a barista at Starbucks says she's lucky to get $12 an hour with tips.

 

Restaurant owners interviewed say that they might add a mandatory service fee line on the bill, dividing that among waitstaff, bus staff to offset some of their outlay on the minimum wage. [Florida restaurants tried that, but many backed off following a Revenue Department ruling that any proceeds from service fees constituted 1099 income]


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