Working People Shouldn’t Have to Rely on Tips for a Living

No working person should be struggling to make ends meet.

But for millions of people across the country who rely on tips to make up their wages, that struggle is a constant reality. Both a legacy of slavery and a driver of sexual harassment and wage violations,the tipped sub-minimum wage system is indisputably unjust.

Everyone should be paid a living wage and have basic workplace protections so that they can sustain themselves financially, be healthy, and be able to take care of their families. Yet, despite providing services that many of us depend on and that help our communities thrive, millions of hardworking people across the country have no such guarantee.

The majority of minimum wage earners and tipped workers are adults providing for their families.

Despite the common misconception that the average minimum wage worker is a teenager earning pocket money, more than half of all tipped workers are women — 35% of whom are mothers — and nearly 60% of tipped workers are people of color.

In Chicago, where the Shriver Center on Poverty Law is based, tipped workers are paid the sub-minimum wage of only $6.40 an hour, an amount that is supposed to supplemented by tips to make up the full minimum wage of $13 an hour. In theory, employers of these low-paid workers are supposed to make up the difference if the tips the worker received falls short of the $13 they are entitled to be paid for their work.

In reality, wage theft and other violations are rampant.

This is not a minor problem with just a few “bad actors”, but rather a systemic one maintained by the archaic sub-minimum tipped wage system. Compliance sweeps of the restaurant industry conducted by the U.S. Department of Labor between 2010 to 2012 showed that 83.8% of restaurants had some type of wage theft violation, including tip credit violations, which resulted in nearly $5.5 million in back wages. It’s clear the current system is not working for working people — or even customers who may believe their tips are going directly to the workers they interact with.

With that low level of pay and such unpredictability around their earnings, unsurprisingly, hundreds of thousands of families in our city have difficulty making ends meet or budgeting for their basic necessities of food, shelter, and healthcare.

A recently proposed rule by the Trump Administration could mean that tipped workers will get even less of their tips.

Under the proposal, which the Shriver Center has challenged, a server who formerly could spend no more than 1.2 hours of a six-hour shift, on average, doing non-tipped work like rolling silverware, cleaning tables, or sweeping floors can now be required to spend two hours — or four hours, or whatever the manager deems “reasonable” — doing such side work, foregoing tipped income while still being paid a sub-minimum tipped wage which can be as low as $2.13 an hour in some jurisdictions.

It is more critical than ever that Illinois and states across the country move away from the tipped sub-minimum wage system.

Let’s be clear: eliminating the tipped sub-minimum wage does not eliminate tips — just the need to rely on them.

Eliminating the tipped sub-minimum wage only removes workers’ dependence on tips, ensuring that they can earn a consistent living wage without relying on the uncertainty of how much they will make in tips on any given day, and without being coerced into tolerating abusive behavior from management or customers.

Though the Chicago City Council did not vote to eliminate the tipped sub-minimum wage in 2019, the Shriver Center will continue to advocate for and with low-wage workers in Illinois and across the country for the end of this unjust system that continues to keep economic security out of reach for so many.

Read the previous installments in our series The Truth About Tipped Wages:

The Racist History Behind America’s Tipping Culture

How Working for Tips Fosters Sexual Harassment