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Hey, Seattle: Not so fast with that minimum-wage hike

Some bartenders and waitstaff, worried about losing tips, oppose the proposal to raise the city's minimum hourly wage to $15.

By Money Staff Apr 29, 2014 1:04PM

This post comes from Peter Robison at partner site Bloomberg BusinessWeek.

Bloomberg BusinessWeek on MSN MoneySeattle's push to become the first big U.S. city with a $15-an-hour minimum wage has hit a snag: opposition from waiters and bartenders.

Fearing a dip in their tip income, some are telling local politicians they're just fine with the status quo. In Washington state, that means $9.32 an hour -- plus tips that, for Seattle bartender Bridget Maloney, can add another $45 an hour on weekends. She's hearing that customers may be stingier if the wage measure pushed by Seattle Mayor Ed Murray passes.

Waitstaff with daily specials © Moxie Productions/Blend Images/Getty Images"People are talking about moving to a European system of tipping," says Maloney, 28, meaning less automatic and not as generous. She has become a spokeswoman for a group called Tips Are Wages, appearing in the Seattle Times, KIRO Radio, and other local media to argue for a carve-out that keeps tipped workers at a lower minimum. "I have built a life around the current model of tipping," she says.

The mayor missed his own deadline to produce a minimum-wage proposal last week, saying his advisers from business and labor are "stuck" over certain issues. Murray, a Democrat, was elected in November after pledging to raise the minimum to $15.

Restaurants have warned they might boost menu prices as much as 25 percent or force servers to share more of their tips with cooks, dishwashers, and other back-of-the-house staff. The average check at Staple & Fancy and eight other restaurants owned by Ethan Stowell, named a "Best New Chef All Star" by Food & Wine magazine, might go from $94 to $117, according to a presentation to the Seattle city council. Pagliacci Pizza, known for such specialties as the salmon primo, says it might remove the tip line from receipts.

Kshama Sawant, a socialist elected to the council on her own $15 pledge, calls those suggestions "fear mongering" and says people who cling to tips miss the point. "We don't want any worker to be beholden to the mood of the customer on any given day," she says.

Academic studies commissioned by Seattle showed a smaller effect on restaurant prices: about 0.7 percent for every 10 percent increase in the minimum wage. They also estimated that a $15 minimum would boost pay for about 100,000 people -- or almost one in four of the city's workers.

Bartender Maloney says she's one minimum-wage worker who doesn’t need the help. After working double shifts and long nights, she's enjoying a vacation. She voiced her opposition via e-mail -- from Barcelona.

More from Bloomberg BusinessWeek

Apr 29, 2014 1:42PM

This is just more socialism. Why can't the value that you bring to the employer in the form of education, experience, work ethic, and talent determine how much someone has to pay you? Why must it be legislated that if you are dumb or poorly educated, have no job experience, are lazy, and have no job specific skills that the least you can be paid to wash dishes or sweep floors is $15 an hour. The world is zero sum people. Who is going to pay for this? Me and you pal. You want a burger and a shake? That will be $24.95 pal! 

Apr 29, 2014 8:14PM
Raise it to $15/hr but I still expect to pay $1 for a McChicken. 

I also expect to pay the same $1.25 for a cup of coffee.

I also expect to pay the same to have my tire changed and the same amount for a butterfinger at a convenience mart.

I also expect to pay the same for a gallon of milk and loaf of bread from the local grocery store. 

I still expect a dozen roses to cost the same as well.

I still expect to pay $2/bag for mulch from hope depot.

I also expect to pay the same for a beer to watch live local bands at my favorite seattle bar.

According to liberals, all prices will stay the same unless someone is being greedy.

Tourism will die in that city.  Also people in the city, will shop outside of the city where prices for things will be cheaper.  The city will die.  GO FOR IT SEATTLE!!!!

Apr 29, 2014 1:27PM

Politicians making promises they can't keep. Par for the course.

Apr 29, 2014 7:04PM

While I would admit that I generally identify as a liberal, I still vote republican at our local level (better for business) and democratic on the national level (don't want Big Biz to get the loopholes and stick it to us w/ the bill). 

They're doing the same thing over here in Hawaii: trying to get the minimum wage from $7.25 to $10.10.  One thing that I've noticed about the democrats who try to promise 'fixing' the minimum wage is that they generally have no idea how to run a business.  When we had testimony at our State legislature, there was a person who testified against the increase in minimum wage, and  had an excellent presentation that showed the economics of the increase and how it would kill businesses.  Didn't matter; of course the politicians did what they wanted to do to support their agenda of re-election.  These people need to get a clue of how the real world works and not screw it up!!

Apr 30, 2014 5:46AM
IMO, a $15 minimum wage is ridiculous.  However, as long as this is legislated at the local level, I have no problem with it.  If the people of Seattle want to elect local pols who want to legally mandate a $15 minimum wage, they have every right to do so.   I kind of hope this measure passes, just so we can see the effects.
Apr 30, 2014 6:08AM

back a few years I was offered a job in Seattle,  framing new homes,  when I started looking into housing costs there before I jumped in I realized that my $70k home in Michigan would cost me well over 350k there, 

Im not sure $15 an hour is enough to keep most people alive there,  if it is,  cant be by much.

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