February 26, 2014- On February 24, 2015 the Acting Commissioner of New York State’s Department of Labor, Mario J. Musolino, announced the passage of certain dramatic wage changes which were, previously, proposed, studied, and debated for four months by the 2014 Hospitality Wage Board regarding the wages of tipped workers in the food and hospitality industries. The direct impact of these changes is to increase the mandated, guaranteed wages for tipped food and hospitality workers.
Classically, workers in New York State that have relied, primarily, on tips for their compensation have been relegated to sub-minimum wages. Food and hospitality industry workers have relied on the benefit of the generosity of customer’s tips to offset the shortfall between their wage and the New York State Minimum guaranteed wage for all other workers.
Effective December 15, 2015 the NYS guaranteed cash wage for tipped workers in food and hospitality will be $7.50 per hour. This is the first such increase since 2011 when the standard for these workers became $5.65 per hour.
For New York City tipped food and hospitality workers the change allows for a $1 differential, or $8.50 per hour. This differential runs parallel to Governor Cuomo’s initiative to allow for a similar differential in the base minimum wage for all other New York City workers as compared the rest of New York State.
The Commissioner also committed to commence a study which examines the impact of the complete elimination of cash wages and tip credits in the food and hospitality industry in New York State. The result of that study are expected later this year.
While the obvious impact of the measures are to increase the wages of tipped workers in New York State and New York City the ultimate true impact is not yet known. Currently, some food and hospitality spokespeople have indicated that the industry, in response to the Commissioner’s initiative, is examining a voluntary elimination of tipping for workers and the imposition of a service fee on all checks to consumers while transitioning workers to the State guaranteed minimum wage for all other workers.