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Gubernatorial Candidate Challenges Governor’s Plans to Eliminate Tip Credit in New York Restaurants

Posted by at 13 September, at 04 : 26 AM Print

In a recent edition of the Daily News, Dutchess County Executive and Republican candidate for governor of New York Marc Molinaro published an op-ed challenging New York
Governor Andrew Cuomo’s plans to eliminate the top credit that New York restaurant owners receive against server hourly wages. The op-ed in its entirety is presented here:

COUNT ON GOV. CUOMO to create a problem where there
is none. Here’s a governor, after all, who once made New York
sheriffs and police officers criminals for fully loading their sidearms.

Now Cuomo is going after the New York restaurant industry
and its hundreds of thousands of food servers. It’s an industry that
has thrived since George Washington hoisted a mug in a farewell
to troops at Fraunces Tavern in Lower Manhattan. But whatever
it is, and however well it works, Cuomo thinks he knows better. He can fix it, even
when it’s not broken.

The governor aims to end what’s known as the tipped wage, which is the minimum

that service workers make when they are also eligible for tips. It’s a terrible
idea that’ll hurt the very people it purports to help. When I worked in a Dutchess
County hamburger restaurant growing up, the tipped wage was about 11 cents —
okay, a bit more than that — but I did the job because I took home enough in tips
to meet my expenses and put away a few dollars for community college. Being a
waiter was the best job around for someone of my age and work experience, and
I was grateful for it.

Today, the tipped wage in New York City is a healthy $8.65 per hour, going up
to $10 per hour at the end of year. In 2014, when the tipped wage was just $5, the
average hourly income for a food server was $23.34, according to the New York
City Hospitality Alliance. Bartenders made $27.48 per hour. Those numbers are
surely higher for both now.

Enter Cuomo. The governor, whom I don’t know ever made minimum wage in
his life, wants to force New York restaurant owners to pay waiters and waitresses
the same minimum wage non-waitstaff makes.
Waiters and waitresses statewide know that customers will cut back on tips,
or not tip at all, when they realize that servers are being paid more ($15 per hour
when the state’s new minimum wage fully takes effect). They also understand that
fewer of them will have jobs if Cuomo gets his way.
How do they know that? Because it’s happened in other states where tipped
wages were abolished. Maine was forced to reverse course on a November 2016
ballot measure that banned tip wages after furious servers were either laid off or
watched their incomes plummet.

Meanwhile, New York restaurant owners already besieged with government red
tape and expenses oppose ending the tipped wage because they simply can’t afford
it. Cuomo’s move would force them to cut staff or raise food prices, which
could easily put them out of business. Already, 80% of New York City restaurants
fail within five years, according to Business Insider. Margins are that tough.
So why is Cuomo doing this?

Apparently because, as he’s challenged on his left flank by Cynthia Nixon, he
wants to showcase his “progressive” bona fides. In this case it means bowing to the
will of radical labor organizations like Restaurant Opportunities Centers United.
ROC United, as it’s colloquially known, wants to unionize New York restaurants
en masse. If these are the people Cuomo wants to impress, he can knock himself
out. But maybe he should do it without knocking New York eateries and their servers
out of business at the same time.

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