tipped minimum wage

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by Ben Spielberg | May 1, 2019 · 1:33 am

Boycott the Anti-Worker Surcharge

Workers in the Fight For $15 movement have sparked dozens of minimum wage increases over the past six-and-a-half years. Workers have also won the battle of public opinion: even the majority of Republican voters now support their efforts. But businesses who profit off low wages, particularly those in the food industry, aren’t ready to concede defeat. When they’re not hoodwinking media outlets with an astroturf group that pretends to represent workers’ interests, restaurants are campaigning hard against higher wages at the point of service.

Adding a small surcharge to your bill is one aspect of restaurants’ anti-worker campaign. Those that employ this practice should be boycotted.

What is the surcharge and where might you see it?

The surcharge is an added cost that a business links to pro-worker legislation. It is presented differently in different establishments. Customers who look closely may just see a line item that says “living wage surcharge” or “mandates surcharge” when they get their checks. Some restaurants may put a note about the charge in small font at the bottom of their menus. Others may put up a sign explaining the added costs.

Signs and menu notes often assert the organization’s support for the benefits that ostensibly led to the surcharge. Don’t be fooled. The note, and the charge, are designed to prejudice customers against living wage policies.

How do we know the surcharge is anti-worker?

Consumers don’t like surprising add-ons; when you go somewhere expecting to pay menu price and then end up needing to pay more, you’re usually annoyed. Business owners who put a surcharge on their menus know that and want you to tie your annoyance to legislation that makes them compensate their employees more fairly.

Note that the labor involved in making, selling, and/or serving a product is only one of many factors that influence a product’s price. The cost of purchasing the ingredients or materials needed to make a product matters, as do rent, utilities costs, advertising spending, and a variety of other business expenses. Have you ever seen a “rent increase surcharge” on a menu? How about an “advertising fee?” Since a business owner’s desired profit may be the biggest factor in the prices that business owner sets, the most honest note on a menu would probably be something along the lines of: “The price of this hamburger is $15 because of the lifestyle of Mr. Smith, the owner of this restaurant and four other restaurants in the city, who lives in a $1.5 million house, drives a Porsche, and is looking forward to his three-week stay at a Hawaiian resort this summer.”

That’s not to say it’s necessarily unethical for businesses to raise prices after a minimum wage increase. While minimum wage increases don’t tend to influence prices very much – in part because they can lead to a higher volume of sales (due to increased demand for businesses’ products), efficiency gains (e.g., lower turnover), and/or more equal distributions of wealth within companies (by shifting profits from owners to workers) – it’s reasonable for prices to be one channel through which businesses with small profit margins absorb added costs. But it is both unreasonable and unethical for a business to itemize labor costs and nothing else. When you see a wage surcharge or note tying price increases to wage increases on a menu, what the business is really saying is that, if it weren’t for the law, they’d be paying their workers a more exploitative wage. And that they’re hoping your annoyance about the surprise charge they’ve added will convince you they should be able to do so.

How can you challenge the surcharge?

The next time you see a business embracing this practice, ask to speak to the owner. Explain why their policy is unacceptable and ask them to change it. If they refuse, let them know that you’ll be boycotting their business until they change their mind. Then leave a note in the comments of this post or send a direct message to @BenSpielberg on Twitter to get the business added to the list below.

Update (8/1/19): Effective 7/23/19, Ike’s Love and Sandwiches became the first business to respond to the boycott by removing their surcharge. They have been removed from the list below. Email aizleforhr@loveandsandwiches.com or call 510-309-9909 to let them know that you appreciate them making the right decision and can now resume eating their sandwiches.

Update (1/19/20): Following conversations with Emily Burton and me, Enoteca La Storia in San José has become the second restaurant to remove the surcharge. They have been removed from the list below. Email Joe Cannistraci at joe@joecannistraci.com to let him know that his concern for his workers’ well-being is much appreciated.

Enoteca La Storia
408-618-5455
infosj@enotecalastoria.com, Mike@enotecalastoria.com, miyuki@enotecalastoria.com, joe@joecannistraci.com
Submitted by: Emily Burton

Notes: Emily emailed them and they wrote a long response attempting to justify the policy, saying (among other things) that they felt it was a better solution to their increased labor costs than raising menu prices and that many other restaurants also have this practice. Emily conveyed that the policy attempts to pit customers against workers and that she would be encouraging others not to go there until they changed the practice.

CALIFORNIA RESTAURANTS TO BOYCOTT

San José

Luna Mexican Kitchen
408-320-2654
lunamexicankitchen@gmail.com
Submitted by: Paul Nyhof

Notes: I emailed management and they never responded.

Treatbot
408-548-7328
info@treatbot.com
Submitted by: Melissa Urbain

Notes: I emailed management and they never responded.

Village California Bistro
408-248-9091
john@thevillagebistro.net
Submitted by: Ben Spielberg

Notes: I emailed management and they never responded.

Zona Rosa
408-275-1411
dine@zonarosasj.com
Submitted by: Ben Spielberg

Notes: I emailed management and they never responded.

San Francisco

Greens Restaurant
415-771-6222
info@greensrestaurant.com, min@greensrestaurant.com
Submitted by: Ben Spielberg

Notes: I had a nice email exchange with Min Kim, their general manager. Min said they support all the pro-worker legislation in San Francisco and said “I do understand your push to include costs in the menu. But, I also do believe you and I would not be having this conversation if it wasn’t separated.” Min indicated interest in discussing the issue further but has not responded to my follow-up emails.

Palo Alto

Local Union 271
650-322-7509
hello@localunion271.com
Submitted by: Ben Spielberg

Notes: I emailed management and they never responded.

Mayfield Bakery and Café
650-823-9200
info@mayfieldbakery.com, karey@bacchusmanagement.com, tim@bacchusmanagement.com
Submitted by: Ben Spielberg

Notes: Founding Partner Tim Stannard wrote to me that “The issue of labor surcharges is a difficult and thorny issue for us…It’s probably too complex to go into in an email, but if you send me your phone number I’d be happy to give you a call to try to explain.” Tim left me a message and said he was interested in chatting about the issue but then stopped returning my emails and follow-up calls.

Oren’s Hummus
408-391-9762
mistie@orenshummus.com
Submitted by: Kate Frelinger

Notes: I emailed Mistie, the President and Owner, and she wrote back an email explaining why they have the surcharge, saying she “encourage[s me] to consider the business owners [sic] perspective in that we do not control the ongoing increases of the additional health care and other costs that are imposed on the business.” She incorrectly contended that the surcharge “is infarct [sic] pro-worker because without denoting these funds to pay for these benefits we would likely have to hire less people or provide a lesser quality of benefit.” When I followed up with an explanation of why her assertions were unfounded, she said she “respectfully need[ed] to decline [my] invitation to speak more on this matter.”

WASHINGTON RESTAURANTS TO BOYCOTT

Check out this comprehensive list from Working Washington.

12 Comments

Filed under Business, Labor

Tagged as boycott, living wage, minimum wage, surcharge, sustainable restaurants, tipped minimum wage

by Guest Authors | October 1, 2018 · 5:44 pm

Dear Councilman Grosso: Please Be Our Ally and Support 77

Dear Councilman Grosso,

We’ve met before. I worked at a bar in Chinatown that you used to frequent. We only spoke a few times, but I remember feeling proud to have you as our guest because you had a reputation for being an ally – an advocate for women and for the LGBTQ community. I’m writing to you today to ask you to be an ally to vulnerable workers in Washington, D.C. by supporting Initiative 77, which will raise the wages of tipped employees and help stabilize a flawed system.

The restaurant industry in Washington has afforded me many opportunities as both a bartender and manager. I have a deep respect for my service industry peers, and when my colleagues came out against 77, I voted “no” alongside them. In retrospect, the pressure in the industry was substantial to oppose, and then to repeal. Yet when the voters of D.C. popularly supported 77, I began to realize that our conversation about the initiative had been imbalanced. We had not heard from bartenders who supported 77 and, perhaps most importantly, we had not heard from many of the most vulnerable members of our industry.

In support of these vulnerable workers, I testified against the repeal of 77 after most of the Council had left for the night, dashing from work after last call at 1:00 a.m. and returning to close the bar after my testimony. While I waited my turn, I heard the fears of my colleagues who work in some of the city’s most renowned restaurants. They testified that 77 would catalyze the decline of our vibrant restaurant industry. Many fears reminded me of those I heard when other voices lobbied against paid sick days. Meanwhile, so many whose fears are realized on a daily basis went unheard that night. Once more, I will try to speak for them, as one of them.

I have felt the volatility of subsisting on tips. At that Chinatown bar, our staff sometimes missed a week’s income when bad weather drove everyone away. More recently, while pursuing my graduate degree, I worked daylight hours, which cut my income to a fraction of what it had been. While I earned meager tips off a handful of guests, I meticulously cleaned and prepped the bar for the busy night ahead. The system allowed my hard work to go unpaid.

I believe that Initiative 77 is a step toward professionalizing this industry and giving all tipped workers the stability and respect that they deserve. This is a bill meant to help the most vulnerable in our industry. It is for women who smile through degrading treatment because we need a tip. It is for underpaid immigrants who toil tirelessly to keep things running, often doing double the work for half the pay. It is for the welfare of our residents who are not chosen to work in the city’s highest-grossing restaurants.

I have seen enormous, unjustified disparities in pay. As a manager, I’ve seen the books. I’ve seen what restaurants spend on turnover, and I’ve witnessed the revenue lost from an undervalued and sometimes uninspired workforce. I also know that rising expenses are absorbed through small increases in food and beverage prices. The industry will shift to accommodate a higher base wage.

The Council has repeatedly asked these vulnerable workers to show themselves. It has asked why they have not spoken more loudly. Councilman Grosso, as an ally, I believe you know better. These groups are more dependent on good relationships with management and staff than they are on any city law. And they already voted once. I am asking you to stand for them. I am asking you do what’s right.

Supporting 77 is a way for you to stand for the rights of all tipped workers across our city. With your support of 77, you’re not choosing between restaurants and workers; you’re choosing to create a more just and equitable system for all.

Aubrey DeBoer

Aubrey DeBoer is a bartender and restaurant manager in Washington, DC with nearly 10 years of industry experience. She has been a Ward 5 resident for the past eight years.