Tipped wage

If it’s passed by Congress, President Joe Biden’s COVID-19 relief proposal would do a lot more than fund relief payments and vaccine rollouts. It would also raise the wage floor for all US workers – and give a particularly long overdue raise to restaurant servers, taxi drivers, manicurists, and other tipped workers.

For Tanya Wallace-Gobern, getting rid of the subminimum wage for tipped workers is a matter of racial justice. “Passing a living wage bill for tipped and non-tipped low-wage workers is essential to reducing inequality,” she said in a recent briefing.

As the executive director of the National Black Worker Center Project, Wallace-Gobern oversees a network of eight centers across the country that aim to build power and transform working conditions for Black workers. The subminimum federal wage for tipped workers, which has been stuck at just $2.13 since 1991, is a clear barrier to their goals.

While employers are technically supposed to make up the difference if workers don’t earn enough in tips to reach the current $7.25 federal minimum, this rule is largely unenforced.

Meanwhile, studies have long found a racial bias in tipping. A survey by One Fair Wage found that prior to the pandemic, 60 percent of Black tipped workers earned less than $15 per hour, compared to 43 percent of white tipped workers. And since the pandemic, 88 percent of them have seen their tips plunge by half or more.

The legislative vehicle for the Biden plan, the Raise the Wage Act, would boost the overall federal minimum wage to $15 by 2025. For tipped workers, it would rise to $4.95 this year and then by $2 per year until it matches the overall $15 minimum in 2026.

The subminimum tipped wage is a shameful relic of slavery. Tipping became prevalent in the United States only after the Civil War, when restaurants and railway companies embraced the practice because it meant they didn’t have to pay wages to recently freed slaves.

That past hangs heavily over many Black workers.

“Let’s face it,” Wallace-Gobern told me, “50 years after President Lyndon B. Johnson declared a war on poverty, Black people in the South still contend with economic hardships, persistent poverty, and the enduring legacy of slavery.”

Wallace-Gobern, who is based in Raleigh, North Carolina, argues that policies designed to empower Black workers will help every other worker, too.

“Black workers are the canaries in the economic coalmine of our country,” Wallace-Gobern said. “When the canary died, that was a signal that the conditions were bad for the miners. That’s the role Black workers play. If you improve their working conditions, that will lift all workers.”

New studies agree with her. The Economic Policy Institute estimates that nearly a third of all Black workers would get a raise under the Raise the Wage Act.

With the National Black Worker Center Project, Wallace-Gobern is aiming to strengthen the capacity of Black worker centers to win minimum wage increases, build up a cadre of civil rights organizers, and advance a Southern strategy on racial justice and democratic freedoms.

Excerpted: ‘End the Subminimum Tipped Wage’

Counterpunch.org