OVER 100 RESTAURANT OWNERS SIGN LETTER TO GOV CUOMO AND LEG LEADERS ASKING TO FREEZE THE TIPPED WAGE
FOR IMMEDIATE RELEASE: December 29, 2015
CONTACT: Jay Holland, 518.452.4222
Over 100 Restaurant Owners Sign Letter to Governor Cuomo and Legislative Leaders Asking to Freeze the Tipped Wage
Albany, New York — Melissa Fleischut, President and CEO of the NYS Restaurant Association, sent a letter to Governor Andrew Cuomo, Senate Majority Leader John Flanagan, and Assembly Speaker Carl Heastie asking them to freeze the cash wage for tipped employees for five years. The letter was co-signed by over one hundred restaurant owners who employ over 8,500 New Yorkers. The letter asks that a five year moratorium on wage boards be put in place for tipped employees if a legislative agreement is made to increase the minimum wage. The majority of the restaurants that signed the letter are small businesses and many are minority and women owned businesses.
“Employers in the hospitality industry are being hit with a whopping 50% increase to the tipped wage this week,” said Melissa Fleischut, President and CEO of the NYS Restaurant. “The industry needs time to adjust to this dramatic increase; this is why we are asking that any increase to the minimum wage exclude tipped employees.”
Under a little known provision of New York State law, the Governor is required to call a wage board for tipped employees every time the statutory minimum wage is increased. This can be offset by including language in any deal to increase the minimum wage that establishes a moratorium on wage boards for a period of five years.
The cash wage for tipped employees is being raised from $5.00 to $7.50, effective December 31, 2015. This was the result of a wage board that was formed after the 2013 budget deal to raise the minimum wage in increments over a three year period. The increase in front of the house labor costs is forcing employees to look for ways to save, including hour reductions, layoffs, using tablets at tables, and going to a non-tipping model.
“It’s hard to imagine any business giving half of their labor force a 50% raise overnight, but that’s the reality the hospitality industry is facing at the moment,” said Fleischut. “This increase has already forced restaurants to close, business owners to cut hours and lay people off, and made owners look to incorporate more tablets at tables; any further increase will just exacerbate these problems.”