Big changes could soon be in store for tipped workers in Chicago. Mary Ann Ahern reports.
Big changes could soon be in store for tipped workers in Chicago.
A City Council committee on Wednesday voted 9-3 to approve a raise in what's known as the subminimum wage, meaning tipped workers would make the same minimum amount as other workers across Chicago.
The move isn't complete just yet, however. The proposal now heads to the full City Council for a vote, which is expected in two weeks.
The change would mean raising the minimum wage for tipped workers from $9 to $15.80 per hour, though such employees could still get tips. Under the guidelines, the $9 hourly wage would rise by 8% for five years until it reaches the $15.80 total.
"For anyone that is afraid that for some reason tips will go away once the base wage for workers goes up a little bit, that tips will go away, the data shows that that's simply not true," Ald. Carlos Ramirez-Rosa said during an at-times heated debate Wednesday.
The proposal was recently backed by the Illinois Restaurant Association, which agreed to a compromise on the proposal, despite its reservations. The association's president Sam Toia said during the hearing the five-year plan to raise the subminimum wage was a "compromise we can all live with."
The debate comes as many across the U.S. have a negative view on tipping, according to a new survey, and as "tipping fatigue" has heightened.
Some advocates say the move will offer a fair wage for many restaurant workers who have long gone underpaid, but others have acknowledged the change could put increased pressure on restaurants.
Some have cautioned that changes to labor costs could end up costing consumers even more, as many already battle surcharges due to inflation and more.
BankRate reported recently that a survey found "roughly two in three U.S. adults have a negative view about tipping." But at the same time, 41% of Americans said they believe "businesses should pay employees better rather than relying so much on tips."
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"In industry, an operator only has two things that he or she controls - that's either product costs and, or labor costs because fixed costs are fixed costs," Toia told NBC Chicago in an interview last month.
Still, according to the BankRate survey, fewer people are tipping waitstaff every year, with only 65% saying they always tip a server when dining at a sit-down restaurant, down from 73% in 2022 and 75% in 2021.
The One Fair Wage movement looks to lobby for similar changes for tipped employees across the U.S.
“There are 10 states that are going to move this in the spring and there are four more states where this is going to be on the ballot in November," said One Fair Wage founder Saru Jayaraman.
If the full City Council approves the measure, the raises will start July 1, 2024.
