‘Tip wage’ should be abolished

Imagine waking up at 4:30 in the morning, taking a shower, making coffee and heading out the door to make it to work for the start of your 6 a.m. to 2 p.m. shift.

Imagine doing that every day of the week. Not just Monday through Friday. Every day.

Now imagine getting your paycheck and seeing that you have earned a whopping $119.28 — minus taxes, of course — for your 56 hours of work.

Now imagine where you might live. Nepal? Nigeria? North Korea? Try North Carolina, where the minimum tipped wage is a paltry $2.13 an hour. If you earn tips regularly (more than $30 a month) in the state of North Carolina, your employer can legally pay you $2.13, the federal “minimum tipped wage.” And some do.

Further imagine you’re making your $2.13 a hour, hoping that customers will find it in their hearts to leave a few extra shekels so that you can do something crazy … like buy food to put in your fridge.

One day one customer does. They leave you a lot of extra shekels in fact. Enough to put food in your fridge (or “on your family” to quote a favorite Bushism) and pay the phone bill, cable bill, car payment and most of your rent for the month. All from one customer — a one in a million customer who leaves you a whopping $1,000 tip. Your heart skips a beat. You call your friends. You tell the kids you’re getting steak for dinner. You pretty much won the lottery.

Hold on there, mister happy pants. That “lottery ticket” of yours don’t do you a lick of good if you can’t cash it. And the one place you can cash that lottery ticket — your employer — says they don’t allow big tips like that. At least not on a credit card. So they run the bill without the tip and you get nothing. Except, of course that $2.13 an hour you worked so hard for.

If you haven’t heard about it, this precise scenario played out on Mother’s Day in a Waffle House in North Carolina. Fortunately it worked out. The generous tipper tracked down the waitress who was denied her gratuity, writing her a check for the $1,000 she was meant to have.

Waffle House has since said that there was a communication gap. She wasn’t denied the tip, of course. They were trying to find the customer to ask him to bring in some cash or write a check. Mmm hmm.

The real travesty here, of course, isn’t Waffle House’s actions. It’s the state of North Carolina allowing employers to pay people $2.13 an hour in hopes of customers making up the difference so they’ll make greater than minimum wage. The real travesty is allowing the service industry to get away with paying a wage you’d expect to see in third-world country and then passing the buck directly to the customers to make up the difference.

Employers like Waffle House, of course, would tell you that if they paid more than the $2.13, they’d have to increase the price of their waffles or they couldn’t pay the rent on their house. So they pay the lesser wage and then expect the customers to pay extra for their waffles … directly to their server.

And then maybe Waffle House will let them keep their tips. Or maybe not.

Scott Leffler once drove 188 miles to eat at a Waffle House, where he hopes his waitress got her tip. Follow his eating escapades on Twitter @scottleffler.

Hard to float without a life vest

Last month, New York State Governor Andrew Cuomo suggested increasing the minimum wage from $7.25 an hour to $8.75. Not to be outdone, in his State of the Union address, President Barack Obama suggested increasing the federal minimum wage from $7.25 an hour to $9 an hour and then indexing it to inflation.

Both men’s plans have been met with significant opposition from the Republican Party and small businesses, who claim that either plan would lead to higher business costs and result in higher unemployment.

It’s hard to argue that higher costs would ensue. Most companies’ highest expense is labor and benefits — and an increase of nearly 25 percent in their highest cost certainly wouldn’t help them.

That said, Cuomo and Obama have both made the point — and accurately so — that you can’t live on minimum wage. Someone working one minimum wage job at 40 hours a week makes $15,080 a year. That is — believe it or not — nearly $4,000 over the federal “poverty line.” If that person is married or has a child, (s)he makes less than the poverty level.

The oft-used argument, of course, is that minimum wage isn’t meant to support a family. Minimum wage jobs are supposed to go to high school kids and whatnot. Which makes sense to me. A 16-year-old can get by making $150 a week or whatever. Their parents pay the rent and electricity and major bills anyway.

That would be all well and good if mom and/or dad had their own good-paying jobs. But there seem to be less and less good paying jobs all the time. And the less good-paying jobs there are, the more companies dial down their wages and make what used to be $12- or $9-an-hour jobs into $7.25-an-hour jobs. Now 40-somethings who used to make a good living are competing with high school kids — just hoping to put food on their tables (or on their families, to quote President George W. Bush).

To make ends meet, people take two of those minimum wage jobs. Or three. Which, of course, leaves less jobs available for others to take, resulting in higher unemployment — and underemployment.

As those $12-an-hour jobs evaporate, people at the next tier — making $15-$20 an hour — see their wages drop as well. It’s “trickled-on economics.”

Typically, I’m in favor of telling government to keep out of our lives — including our businesses. Theoretically, I’d like to say, “If people are willing to work for $5 an hour, then so be it.” The problem with that, however, is that there are times when the balance of power shifts significantly away from the people and we end up being the equivalent of indentured servants. In my opinion that’s when government needs to step in.

Yes, raising the minimum wage will lead to higher costs for businesses. But what do businesses think people are going to do with that extra $70 a week? They’re going to spend it. Every penny of it. And that’s going to put that money back into those business owners’ pockets. And hopefully that rising tide will float all boats.

Scott Leffler made minimum wage once. He was grossly overpaid. Follow him on Twitter @scottleffler.