Financial Disparities Between Tipped and Full-Wage Workers Larger Than Ever
A new study shows that the wage gap between tipped and non-tipped workers is the widest it's ever been in American history.
1966 amendments to the Fair Labor Standards Act (FLSA) created protections to hotel, restaurant and other service employees, but also created a sub-wage for tipped workers with the expectation that an employee's tips, when added to the sub-wage, would match or exceed the minimum wage. In effect, the tipped wage created a subsidy for service employers, exempting organizations that used tipped labor from paying full wages.
According to a new study from the Economic Policy Institute (EPI), tipped laborers face much more stringent economic outcomes than their full-wage peers. According to the study, the poverty rate among non-tipped workers is 6.5 percent - but among tipped workers, it rests at at 12.8 percent. More than half of the people represented by this overwhelmingly female demographic are more likely to rely on public assistance as a permanent wage subsidy. The authors of the EPI study note that public assistance was never meant to become "part of the business strategy for low-wage employers." They also found that the tipped laborer workforce is currently the largest it has ever been.
In their own research focused on tipped workers, the Restaurant Opportunities Center (ROC) found that one in three tipped workers are parents, and of that number one in six rely on free and reduced lunch programs to feed their children. Poverty rates dramatically rise to 25% among tipped workers who are people of color. However, overall poverty decreases in states with higher minimum wage rates.
The Department of Labor recognizes tipped employees as those who "customarily and regularly" receive $30 or more per month in tips. According to the PolicyMatters Journal, that breaks down to $1.50 a day in tips each month. Employers are required to pay tipped workers $2.13 per hour. An employer can claim a "tip credit" up to $5.12, the difference between the direct wage they're required to pay and the $7.25 federal minimum wage. According to the Department of Labor, an employer should make up the difference if a worker's tips do not cover the difference.
7/27/2015 Senate Majority Leader Mitch McConnell Blocked Efforts to Defund Planned Parenthood - An attempt in the Senate to defund Planned Parenthood by Mike Lee (R-UT) was blocked this weekend by Senate Majority Leader Mitch McConnell (R-KY). Lee tried to attach the elimination of federal funds for Planned Parenthood to a vote for highway legislation, a move which was rejected by McConnell as out of order.
Republican legislators have redoubled their efforts to block funding for Planned Parenthood since the release of two heavily edited clandestine videos of different PPFA employees taken without their knowledge. . . .
7/24/2015 Katherine Spillar Urges Cleveland to Dramatically Increase Hiring of Women Police to Mitigate Police Violence - In a well-received speech at the City Club of Cleveland today, Katherine Spillar, Executive Director of the Feminist Majority Foundation urged Cleveland city officials to dramatically increase the hiring of women police officers as a way to decrease police brutality incidents.
Following a number of high profile police killings in Cleveland of African Americans, and an eight-month investigation by the US Attorney's office of the Northern District of Ohio, the City of Cleveland has now entered into a Consent Decree that requires numerous reforms in how the city oversees and investigates police operations, including training in use of force.
"Among the most important reforms mandated by the consent decree - and the most easily overlooked - are the changes the Cleveland Division of Police must make in its recruitment and hiring practices,
said Spillar. . . .