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Democrats Could Play Key Role in Repealing Wage Increase for Tipped Workers

Susan Sharon
Maine Public
Customers inside Rolly's Diner in Auburn on Wednesday.

Nearly a dozen Democratic lawmakers, and possibly more, are backing an effort to overturn the repeal of the wage for tipped workers.

The repeal is included in the citizen-initiated law raising the base wage for thousands of Mainers. But doing away with the tipped wage has long been resisted by restaurant owners and their workers, who worry a higher base wage will mean lower tips and a pay cut.

Nearly 420,000 Mainers voted to support raising the minimum wage in November, a solid majority of 55 percent — the kind of victory that would seem to settle the matter. But it hasn’t, at least for servers like Christine Morrisson, who waits tables at Rolly’s Diner in Auburn.

Her base wage has gone up, but she says she’s seen a 10 percent dip in tips since Question 4 became law.

“In all, they’re tipping us less but we need to make more. So it’s a catch-22,” Morrisson says.

Waitress Tiffany Churchill at Happy Day’s Diner in Auburn says she’s experiencing it, too. Churchill, a single mom, says her tips have dropped by about 25 percent. She says customers are tipping less and seem to confused about how much they make under the new law.

“I think people think our hourly (wage) went up more than it did and they’re not compensating us the right amount for our services,” she says.

Darren Doulin, the owner of Happy Day’s, says the higher minimum wage may force him to increase menu prices to offset pay raises for staff.

“I think it’s going to put small places like me out of business,” he says.

Such concerns are not new to state lawmakers. They heard them two years ago, when restaurant owners and tipped workers showed up to oppose a standalone bill to eliminate the tipped wage.

Question 4 eventually eliminates the tipped wage. It’s a contentious idea, even among Democrats united about raising the minimum wage.

State Rep. Brian Hubbell is among at least eight Democrats in the crosshairs of progressive groups like the AFL-CIO and the Maine People’s Alliance because they support reinstating the tipped wage.

Hubbell represents Bar Harbor, a tourist destination with an economy buoyed by restaurants and the workers who currently depend on tips to make a living. Last year he told the Mount Desert Islander that he supported Question 4, but he opposed eliminating the tipped wage.

“This is really a case where I’m hearing from the workers themselves,” he says. “It’s not they’re reflexively opposed to it. They’re just really worried about it.”

Worried, that is, about a pay cut.

The tipped wage used to be $3.75 an hour when the regular minimum wage was $7.25. The tipped wage is now $5 an hour, thanks to the passage of Question 4, and it’s supposed to increase until it’s equal to the regular minimum wage in seven years, by then at least $12 an hour.

That might seem like a decent raise, especially if tipped workers keep receiving tips.

But concerns that customers will stop tipping persist. And they're not new.

Two years ago, a stand-along bill was introduced to eliminate the tipped wage. Sen. Amy Volk, R-Scarborough, co-chairwoman of the Labor Commerce and Economic Development  Committee recalled the public hearing in which restaurant owners and workers lined up to testify against the bill. 

"It was very overwhelming," she said.

And the proposal was overwhelmingly defeated in committee.

Now lawmakers in both parties say they're hearing from the same workers and businesses. Hubbell says this isn't some big lobbying effort by big business, as his critics have suggested.

"If the president of Applebee's is coming to lobby me about about that, I'm not going to say I don't care. But those aren't the people who tug at me to do the right thing the way these families are," he said.

Matt Schlobohm of the AFL-CIO says he believes that Democrats should not support any efforts to undo Question 4, saying the tipped wage repeal was deliberately included in Question 4.

“I think Democrats should not be in the business of lowering workers’ wages. And tampering with the referendum — let’s be very, very clear — what it does is lower workers’ wages and that’s a bad idea,” he says.

The AFL-CIO cites federal data estimating that Maine servers make just over $9 an hour with tips. And, they say, seven other states have done away with the tipped wage without catastrophic consequences.

They cite other reasons for rejecting a tipped wage economy — studies showing female servers are more prone to sexual harassment by employers and the customers they rely on for tips.

“We have an economy that’s deeply out of balance where workers can’t make ends meet and we need to raise wages for all workers,” Schlobohm says.

But correcting the economic imbalance appears to have a math problem. It may take only a handful of Democrats to reinstate the tipped wage, a move supported by Republicans and Gov. Paul LePage.

Rep. Lance Harvell, R-Farmington, believes that there are more than eight Democrats who will vote to reinstate the tipped wage.

"My sense is that if you're in a service community, I don't care what you are, Democrat, Republican, Green, man on the moon, that you're hearing from these people," Harvell said.

Harvell believes those voices could be more persuasive than progressive groups like the AFL-CIO and the Maine People's Alliance.

Schlobohm isn't convinced, arguing that the progressive base is already energized as it lines up to resist President Donald Trump in a movement that some have compared to the tea party that eight years ago took down Republican candidates who didn't align with firm conservative policy issues.

There are several bills to reinstate the tipped wage, which means the battle over its future will likely come to a head at the end of the legislative session.

Note: This story has been updated to remove references to subminimum wage, which has a specific definition not applicable to the debate over the tipped wage.