Tipped Wages Set the Table for Poverty, Sexual Harassment

Feb. 17, 2018

At a recent conference in Detroit, I had an opportunity to meet Saru Jayaraman, co-director of the Restaurant Opportunities Centers United (ROC United) and hero of the gender equality movement. She was presenting at session titled “Closing the Gender Equity Gap.”

While I have been aware of pay inequality for a long time, she presented a mind-blowing study that connected low hourly tipped wages with an increased rates of poverty and sexual harassment for restaurant workers. She also made a compelling argument for why many women who experience harassment and abuse early in their working career choose to downplay or ignore it later on.

Here in Michigan, the tipped wage is $3.38 per hour, and in order to reach the state's minimum wage, lawmakers expect that the remaining $5.52 to be made up through customer tips. Adding insult to injury, restaurant owners are required to report their servers' tips to the IRS, so base wages go toward covering taxes. As a result, nearly all take-home income comes from tips.

“When you earn [minimum wage as a waitress], your wage goes to taxes and you get a paycheck that says $0. You live on your tips, and when you live on your tips, you have to put up with inappropriate customer behavior in order to feed your family,” said Sheena Bland, a restaurant worker from Detroit.

Today, 70 percent of tipped workers in Michigan are women who suffer from three times the poverty rate of other Michiganders, even when taking tips into account. Forty percent are single moms who support their families on tips.

This is especially problematic when you consider that the restaurant industry is the single largest and fastest growing private sector employer in the country. It is worth nearly $800 billion a year and employs more than 14 million workers, with one in ten Americans working in a restaurant.

According to a 2014 ROC United study, women working in states with a sub-minimum tipped wage were twice as likely to report experiencing sexual harassment than women where the minimum wage is the same for tipped and non-tipped workers. This is even worse when you consider that the restaurant industry is already the single largest source of sexual harassment charges filed by women with a rate five times higher than any other industry.

The same study surveyed 688 restaurant workers found that whopping 80 percent of women experienced sexual harassment from customers. Two-thirds reported it from managers, and half from co-workers. (Male restaurant workers also reported experienced sexual harassment, but to a lesser degree.)

“We also learned that managers were encouraging them to objectify themselves — to wear more make-up, to show more cleavage — at three times the rate in states like New Mexico, where the wage is $2.13, than in states like California [with a $10.00 minimum wage],” says Jayaraman.

Interestingly, when tipping first came to America in the 19th century from Europe, Americans found it dehumanizing and demeaning. They thought it seemed contrary to American democratic ideals.

“They rejected it as the vestiges of a feudal system. They thought you should get good service regardless of how much you are able to tip,” says Jayaraman.

But railway companies and restaurant owners fought successfully to have the practice allowed. And while railway workers unionized and abolished the system, restaurant workers never did.

In time, Europeans rejected the notion of tipping, but Americans continued to embrace it.

“In a country where we believe we have done away with master-servant relations, the existence of tipped workers show us this is far from the case,” said Dianne Avery, a professor at the University of Buffalo. “Because what tipped workers represent for the moment of that exchange [with a customer] is an intimate master-servant relation.”

She added, “I think the notion of a young attractive female waitress as a sex object has entered as a cultural norm as a result.” As evidence, Avery points to the emergence and popularity of “breastaurants” like Hooters, where servers are expected to wear form fitting clothes and flirt in order to get tips.
Over the past few years, Jayaraman and members of ROC United have gone up against the powerful National Restaurant Association (the “other” NRA) lobby to abolish the tipped minimum wage, a campaign was the focus of her 2013 book, Behind the Kitchen Door.

While on tour for this book, she was approached by women from across the professional spectrum who pointed to jobs in restaurants as their first experience with gender-based discrimination and harassment.

“Countless young women are introduced to the world of work through the restaurant industry,” says Jayaraman. “And they go on to be more likely to accept forms of sexual harassment as ‘just part of the job.’”

“They’d say, ‘I’m a successful woman now, and I’ve been sexually harassed recently on the job, but I didn’t do anything about it because it was never as bad as it was when I was a young woman working in restaurants,’” she says. “So we realized that there are millions of women who’ve gone through this industry in high school, college, or graduate school as their first introduction to the working world. This is how we show young women what’s acceptable and tolerable in the workplace.”

For me personally, this theory rings true. My first job at age 15 was as a dishwasher at a local boat club where I was constantly harassed and sexually propositioned by customers, and even my manager who thought was okay to get my attention by pulling my hair or snapping my bra straps.

I went on to work several humiliating restaurant jobs both in and out of college, including a nine-month stint at a country club. There, while working a private bachelor party (complete with a stripper), I was teased, grabbed, and groped by a group of horny male customers. One thought it would be fun to pull me onto his lap so he could prove how much I was turning him on. At the end of the night, another one of them “rewarded” me with a $100 bill. In tears, I left it on the table and never came back.

Later on in my sales career, I continued to experience discrimination, harassment, and emotional abuse — but because nothing compared to my past waitressing jobs, I figured that this was just the “way things were” and continued to keep my mouth shut.

But now, with the revelations exposing and rejecting the behavior of many high-profile men in Hollywood, media and politics, I am hopeful that we are at an important turning point.

Today, Jayaraman and others are fighting for the abolition of the tipped sub-minimum wage under a campaign called “One Fair Wage.” It pushes states to eliminate the two-tiered wage system and adopt the regular federal minimum wage for everyone, tipped or non-tipped.

Raising the tipped minimum wage, she argues, protects female employees who are uniquely victimized by the two-tiered system. The seven states that have established One Fair Wage — California, Oregon, Washington, Nevada, Montana, Minnesota, and Alaska — have cut the rate of reported harassment nearly in half, in large part because workers know that refusing to entertain a customer’s advances won’t jeopardize their income.

And, there is evidence that it can actually spur economic growth.

“We found that [states where everyone earns the same minimum wage] were fairing better by every measure,” says Jayaraman. According to ROC United, these states have experienced above-average employment growth, an increase in per capita restaurant sales, and even higher rates of tipping. Their findings undermine the NRA’s argument that raising wages will put restaurants out of business and stop customers from tipping.

After years of hard work, ROC United's efforts to abolish the tipped minimum wage are finally paying off, Jayaraman says. Lawmakers in seven more states have introduced legislation to end it.

In Michigan, a coalition seeking to raise the state's minimum wage to $12 per hour and phase out the lower wage for tipped workers recently announced the launch of a ballot measure campaign to take the issue to voters in the 2018 election.

“Ten years ago we were having a real hard time connecting labor issues to the food movement.

Now the movement is recognizing that this is a top priority,” Jayaraman said. 
Foodies are finally connecting the dots between sustainable food and sustainable wages and as a result, the momentum for change is accelerating. She adds, “No one should have to experience the financial insecurity, discrimination, and sexual harassment that comes with being forced to live off tips.”

Christie Minervini is a Traverse City resident who owns Sanctuary Handcrafted Goods in the Village at Grand Traverse Commons. She is passionate about gender equality, community development, and ending homelessness.