Five years after former New York State Gov. Andrew Cuomo eliminated the subminimum wage for some workers but not restaurant workers, several of the state’s lawmakers have reintroduced legislation to amend that omission.
The subminimum wage, or tip credit, allows employers to make up for part of the required minimum wage with presumed gratuity. The dual One Fair Wage legislation, sponsored by Assemblywoman Jessica González-Rojas in the State Assembly, and by State Sen. Robert Jackson in the State Senate, would require New York employers to pay their employees a minimum wage with tips on top, thereby eliminating the tiered system, which currently has different requirements for foodservice workers vs. other employees.
Currently, foodservice employers can take between $5.15-$5.50 an hour in tip credit (depending on where in New York they are), whereas other service employers can only take between $2.60-$2.75 an hour in tip credit. For select employees like salon workers and doormen and women, the subminimum wage will be eliminated by Dec. 31, 2025, a five-year deadline extension from the original legislation, but restaurant workers are not included in that.
The federal minimum wage rules mandate $7.25 an hour.
“[The bills would benefit] hundreds of thousands of workers across the state by ensuring fair pay, reducing their reliance on unpredictable tips, and addressing systemic inequities that disproportionately impact women and workers of color,” minimum wage advocacy group One Fair Wage said of the proposed legislation.
New York has considered banning the tipped wage since the state began public hearings on the matter in 2018.
“We were successful [with eliminating the subminimum wage], except the fact that restaurant workers have continuously been cut out of that process,” Assemblywoman González-Rojas said while introducing the bill last week, according to the Times Union.
Currently seven states have banned a tip credit: Alaska, California, Minnesota, Montana, Nevada, Oregon and Washington, as well as individual cities like Chicago, which voted to phase out the subminimum wage in October 2023.
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