The Nelson A. Rockefeller Center for Public Policy and the Social Sciences

The Tipping Point: How the Subminimum Wage for Tipped Workers Keeps Incomes Low and Sexual Harassment High in the US Restaurant Industry

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On Thursday, May 6th, 2021, Catharine A. MacKinnon, the Elizabeth A. Long Professor of Law at the University of Michigan Law School and a renowned writer and activist on sex equality issues; and Saru Jayaraman, an attorney and activist who serves as President of One Fair Wage and Director of the Food Labor Research Center at the University of California, Berkeley, met with Dartmouth students and community members to discuss the impact of tipping on female restaurant workers. The panelists argued that tipping harms women by depressing their wages and making them vulnerable to sexual harassment. Susan Brison, Dartmouth’s Eunice and Julian Cohen Professor for the Study of Ethics and Human Values and Professor of Philosophy, served as event moderator.

The event began with testimony from a New Hampshire restaurant owner and worker, who explained that restaurant workers don’t earn a typical minimum wage. Instead, they earn a subminimum wage that is meant to be augmented with tips. At the federal level, this wage is a meagre $2.13 per hour, resulting in the income of restaurant workers being determined by tips, and in turn, the good graces of their customers.

Over the past year, this has led to a toxic dynamic. Amidst the hardship of the COVID pandemic, female restaurant workers have found that tips are down, and sexual harassment is up. Frustratingly, women report that they have been asked to remove their masks to allow customers to evaluate their appearances prior to receiving tips. Because tips are their main source of income, female restaurant workers struggle to rebuff these advances.

Jayaraman then described the “sordid history” of tipping. For generations, the restaurant industry has been one of the lowest paying industries in the country because of its reliance on tipping. In large part, tipping has remained prevalent in the U.S. due to the efforts of the National Restaurant Association, a powerful trade lobby that has consistently opposed granting a full minimum wage to restaurant workers.

But how did tipping become so prevalent? Jayaraman notes that tipping was originally a feudal European practice that allowed lords to recognize exceptional servant labor. In the 19th century, Americans were opposed to tipping because they worried it would create a similar, unequal power dynamic, favoring employers over unenslaved workers. Those fears dissipated when Black Americans were emancipated after the Civil War. White employers, hoping to circumvent the high wages they needed to pay White workers, lobbied to hire Black workers who would be compensated with tips instead of wages. This effort was successful, relegating Black workers to tip-based opportunities that consigned them to poverty and made them dependent on the largesse of (often White) patrons. This leads Jayaraman to view tipping as a “legacy of slavery.”

Additionally, Jayaraman believes tipping devalues women’s work because the majority of restaurant workers are women. As it stands, 43 states in the US, including New Hampshire, offer restaurant workers only a subminimum wage, making many women reliant on tips.

MacKinnon then detailed the harm caused by a reliance on tipping. Specifically, she finds that the tipped wage structure of restaurants imposes a higher incidence of sexual harassment on women because tip-reliant workers must tolerate harassment to get paid. Studies conducted with Louise Fitzgerald “confirmed that being forced to rely on tips explains more about sexual harassment [in the restaurant industry] than anything else we know of.” Among women who receive only a “subminimum, subhuman wage,” 76% report having been sexually harassed. MacKinnon argues that women of color in the restaurant industry experience higher rates of harassment because they are most vulnerable to economic exploitation by “entitled White masculinist sexuality.” In the restaurant world, Mackinnon surmises that she and Jayaraman have identified “the mother lode… or maybe the patriarchal lode, of sexual harassment.”

What does that leave in terms of solutions? Jayaraman thinks that the subminimum wage for restaurant workers should be abolished in favor of a full minimum wage with “tips on top.” Restaurants in states that provide a full minimum wage to restaurant workers, like California, have thriving businesses in spite of paying higher wages. Additionally, a higher wage could resolve the chronic labor shortages facing restaurants. Most importantly, however, a full minimum wage would reduce the reliance of restaurant workers on tips. “When you pay a woman a full minimum wage, she doesn’t have to put up with as much [poor treatment] from customers,” Jayaraman says.

Like Jayaraman, MacKinnon views paying a minimum wage to restaurant workers as doing more than any solution “to significantly reduce sexual harassment in the restaurant industry.” Why, MacKinnon asks, should women sacrifice “their dignity, their integrity, their equality, and, in some cases, their mortality for the privilege of earning an obscenely less than living wage?”
 

Written by Ben Vagle ’22, Rockefeller Center Student Assistant for Public Programs

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The Nelson A. Rockefeller Center for Public Policy and the Social Sciences