Restaurants worry about tip culture

LANSING Mich. (WLNS) – Restaurant owners and servers are worried about a Michigan Supreme Court ruling that they say will hurt the tipping system. They spoke with lawmakers on Wednesday to tell them what they want to see happen to prevent the ruling from going into effect.

The history behind the situation goes back quite a few years. In 2018 the group One Fair Wage created a ballot initiative to raise the minimum wage to 12 dollars for everyone including servers and bartenders.

Lawmakers chose to adopt and amend the initiative and reverse the wage increase, which allowed servers to continue relying on tips for income rather than receiving the minimum wage. However, after a lawsuit, the Michigan Supreme Court ruled this unconstitutional and reinstated the original ballot initiative giving everyone a $12 minimum wage.

People like bartender Joshua Smalley say this will eliminate the tip credit, which he says is the expectation of a customer to tip.

“All of us servers and bartenders will make less money and a lot of us will end up losing our jobs,” Smalley said.

Smalley said he likes the way things are with the current system of tips being a part of his income and if it’s not broken, don’t fix it. Even though the law also provides workers paid sick time, Smalley said that aspect is just not worth the pay cut he would experience.

“I think we are willing to compromise, but for the most part, I think we just want to keep things the way they are. Sit-down dining places will end up closing their doors, and I don’t think any of us want that,” Smalley said.

This ruling does not eliminate tips but people say they feel that if customers know their server is making minimum wage they will be less likely to tip. A spokesperson for Save MI Tips, John Sellek said servers have already started to see that happening.

“If they wanted a basic minimum wage job, they would’ve gone out and got one. These jobs pay way more than minimum wage, they’re paying closer to 30 dollars an hour,” Sellek said.

James Hawk with One Fair Wage, the group looking to make these changes, said he doesn’t think people will know about the changes in wages, therefore nothing will change.

“We have in southeast Michigan, there are about 11 restaurants that pay a minimum wage or higher, and their tips are higher right now,” Hawk said.

He said those 11 restaurants are doing fine themselves, even though they are spending more to pay their employees.

“At One Fair Wage we have classes for business owners to take so they are able to transition into paying their workers minimum wage or more,” Hawk said.

If lawmakers do not make any changes, minimum wage and paid sick days for everyone will go into effect in February.

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