Oct 15, 2024
BOSTON (SHNS) - Scrapping the tipped-wage structure for waiters and bartenders could devastate the restaurant industry in Massachusetts, a ballot question opponent warned Monday, while a supporter outlined the potential financial relief for hospitality workers. Doug Bacon of the Committee to Protect Tips urged Bay Staters to vote no on Question 5, which would gradually phase out the tipped pay structure, and Alex Galimberti with the One Fair Wage campaign sought to rally support for the referendum during a fast-moving debate on GBH News Monday, hosted with about three weeks left until Election Day. Bacon, founder of the Red Paint Hospitality Group that operates restaurants in Boston, said the question is "very bad for small business owners." "Many restaurants will close. We will be left with nothing but fast food and fine dining with nothing in the middle. Affordable restaurants will disappear," Bacon said. "Menu prices will go up dramatically. When this is fully implemented, if it were to pass, menu prices will go up 25 to 30 percent everywhere." Galimberti argued the question would tackle inequities in the restaurant industry, particularly outside of high-scale establishments where he said workers are struggling to earn a living wage. The question would also shield workers from wage theft, he said. "Question 5 is important because it brings about fairness for workers. It protects workers from economic instability, from the constant danger of sexual harassment and other forms of discrimination, and from wage theft," Galimberti said. "It is also fair for consumers because consumers are not going to be so much in charge of subsidizing the livelihoods of restaurant workers, not only through tips, but also through benefits that a lot of restaurant workers have to rely on." A Suffolk University and Boston Globe poll last week found that 51.6 percent of likely voters oppose the question, while 39.6 percent support it. Customers could still tip workers should the question win approval at the ballot, but tipping culture faces an uncertain future.  Tipped workers currently earn an hourly wage of $6.75, and if they do not make enough in customer tips to reach the state's $15 hourly minimum wage, employers are required to pay them the difference. The ballot question would eliminate that tipped structure over a five-year period, and by 2029 workers would be earning the full minimum wage. The measure also gives restaurant owners the option to create tip pools, in which waiters and bartenders share their tips with back-of-the-house workers who do not interact with customers, such as cooks and dishwashers. While Bacon emphasized there is no sub-minimum wage in Massachusetts, Galimberti contended that he and fellow restaurant workers have experienced wage theft. Bacon said the "vast majority of people who work for tips in Massachusetts are fairly compensated and in fact, earn in excess of minimum wage." Galimberti, invoking data from Attorney General Andrea Campbell's office, said about 14 percent of wage theft complaints to the Fair Labor Division come from the restaurant industry despite comprising just 5.6 percent of the state's tipped worker population. "Now these are the workers that are brave enough to come forward and complain about wage theft," Galimberti said. "But in an industry that employs an overwhelming majority of immigrant workers -- people that are afraid of bringing forward complaints -- a lot of these complaints go unreported." Forty-three states across the country, including Massachusetts, pay tipped wages. A Tufts University analysis on the ballot question last month said it is difficult to forecast the economic impacts of the transition since "it's been decades since any state eliminated its tipped wage." In the nation's capital, where the city is phasing out tipped wages, the report said, "Not enough time has passed to really assess the economic impact in Washington, but early numbers don't show any obvious problems on the job front. There are somewhat fewer bartenders, an increase in waiters and waitresses, and earnings that are broadly consistent with recent years." Bacon, asked about the report's assessment by Boston Public Radio co-host Jim Braude, said, "That's not the data I've seen." "I have seen reporting, both in the media and by some think tanks that have done research into what has happened in D.C., and what I've seen is they've already lost 10 percent of full-service restaurant jobs," Bacon said. Galimberti called Bacon's comments a "misrepresentation." "I would like to see the opposition point to scientific data because there's no data out there showing that states that have one fair wage plus tips, a full minimum wage for restaurants workers, have hurt in the employment sector," Galimberti said. Bacon forecast a bleak outlook for the state's restaurant sector, particularly affordable restaurants, where he said owners will be forced to raise menu prices to make ends meet if voters approve the ballot question. Customers will turn to other competitors, including grocery stores, Uber Eats and DoorDash, Bacon said. He also warned customer service will diminish if restaurant workers are earning a minimum wage, rather than hustling for tips during busy shifts. "If you're in one of my affordable restaurants and you want to have a burger for 15 bucks, and now it's $20, affordable restaurants will be wiped out in every city and town and main street, and our elected officials realize what a bad idea this is," Bacon said. The legislative committee tasked with reviewing initiative petitions in May decided not to take any action on the ballot questions. In a report on the tipped workers question, the committee said, "At this time, there is insufficient evidence provided on the overall impact that this Initiative Petition would have on the restaurant industry and restaurant workforce in the Commonwealth." "Questions remain on the viability of restaurants and other tipped wage industries to absorb the costs of the more than 100 per cent increase from the current minimum tipped wage an employer is responsible for paying, and comparisons to other jurisdictions are challenging given that the seven states employing this law have followed this policy for many years," the report continued. Galimberti said that restaurant owners are "resilient," as he brought up other financial challenges businesses face, like rising rents. "They know how to do this, and that's why this law is written in a way that is a gradual implementation. It's a slow phase-in that restaurant businesses can adapt," Galimberti said. "And you know, Doug, you raising the price of your hamburger by $5 over one year, that's price gouging, man."
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