The push for higher wages for workers earning tips has been gaining strength across the United States. This movement has seen some success with several states leading the charge to raise minimum wages for tipped employees.
Currently 32 states have wages higher than the federal rate of $2.13 an hour. These higher wages address the inherent income volatility and unpredictability of wage-earning tipped workers who are often subject to tips that are often rooted in bias and subject to discrimination.
As legislation in the states that have included wages for tipped workers has demonstrated some success, many more states are now considering pursuing similar legislation. Just recently, Arkansas, Nevada, Maryland, Connecticut and Vermont have joined the ranks of states that are pushing for tipped workers to earn full minimum wage.
Under current federal law, tipped employees are only required to be paid a base rate of $2.13 – a rate that hasn’t been changed since 1991. This is significantly lower than the federal minimum wage of $7.25 an hour, as well as lower than the current living wage for many states which, according to the National Employment Law Project, can be as high as $11.00 in Rhode Island.
However, advocates argue that tipped workers often still don’t earn a livable wage, as they don’t always receive tips, or receive less than the federal minimum wage even with tips. With this in mind, the push for higher wages for tipped employees is gaining momentum in a growing number of states in the hopes of creating parity with the federal minimum wage.
A recent analysis by the Economic Policy Institute found that raising the minimum wage for tipped employees would directly affect over 1.3 million workers in the U.S., with the greatest impacts on people of color and women. It is a step that has been long over-due, and one that is being embraced by states across the nation.
For too long, the income of tipped employees has been volatile and unreliable, and this trend is finally being addressed in the form of legislation. With more states joining the ranks of those mandating full minimum wages for tipped workers, the future of employment and wages is finally looking brighter in 2021.
