(c) 2016 Jon L Gelman, All Rights Reserved.

Monday, September 16, 2013

Tips and Poverty

In the calcuation of wages and rates of benefits, most state workers' compensation programs incoporate tips. Elimination of tips, would eliminated added coverage benefits paid under workers' compensation programs.Today's post was shared by Steven Greenhouse and comes from

When The Times’s restaurant critic, Pete Wells, recently called tipping “irrational, outdated, ineffective, confusing, prone to abuse and sometimes discriminatory,” he was referring mainly to mid- to high-priced restaurants that are considering an end to the practice in favor of surcharges or service-included pricing.

In the diners and other more “value oriented” restaurants that employ most of the nation’s burgeoning ranks of waitresses (the vast majority of servers are female), tips are all that and more. They are part of a parallel economic universe in which employers are allowed to pay sub-minimum wages, with predictably devastating results. According to census data, servers are far more likely than other workers to live in poverty.

It is a national disgrace when hard work, in any industry, leaves workers in poverty. But falling living standards and economic hardship among tipped workers signal prolonged stagnation throughout the economy. That’s because employment growth in restaurants and bars has outpaced growth in nearly all other sectors in recent years, including health care, manufacturing, retail and financial services. 

If wages in food-service and other service jobs are not lifted, it is hard to see where adequate consumer demand will come from to generate and sustain a real recovery.

It is not tipping that most needs to end, however. What needs to change is the federal law that sets the minimum wage for tipped workers...
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Jon L. Gelman of Wayne NJ is the author NJ Workers’ Compensation Law (West-Thompson) and co-author of the national treatise, Modern Workers’ Compensation Law (West-Thompson). For over 4 decades the Law Offices of Jon L Gelman  1.973.696.7900  have been representing injured workers and their families who have suffered occupational accidents and illnesses.