> A lot of liberals get tipped worker wages wrong.

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Aren't tips currently exempt from taxes?

Spanky wrote:

Something seems off about this.

Prior to the CC era, most tips were cash. Management had no idea what tips people were making. A worker would have been incentivized to underreport tips to management, so management would have to make up the delta. While underreporting of tips to the IRS is well-known, management would not have long tolerated a situation where they didn't know if they truly owed a delta or not.  So, I think in practice that people got paid $2.13 an hour no matter what happened with their tips.

Now with CC, everything is easily proven. But there are still other complexities such as bus people. The waitstaff often tip out the bus people, so the waitstaff actually have some costs. And we are back to bus people having ambiguity about their actual tips, so they probably just get $2.13 an hour from management.

The law is that everyone gets at least minimum wage, and tip outs and tip pools are regulated.

Its also illegal to make a server do work to "cool" their wages. They can assign some side work, such as wiping down tables, or rolling silverware, but it has to be directly related to the serving work. Any other duties,
like prepping food or mopping the floor -- its legal for the employer to ask, but they must pay full minimum wage for it.

But here is what is legal, and I'm sure happens all the time. An employer will give the server one or two rush shifts, which tips more than minimum, and one slow shift. The rush
shifts make up for the slow one.

Phillip_McCavity wrote:

The law is that everyone gets at least minimum wage, and tip outs and tip pools are regulated.

Its also illegal to make a server do work to "cool" their wages. They can assign some side work, such as wiping down tables, or rolling silverware, but it has to be directly related to the serving work. Any other duties,
like prepping food or mopping the floor -- its legal for the employer to ask, but they must pay full minimum wage for it.

But here is what is legal, and I'm sure happens all the time. An employer will give the server one or two rush shifts, which tips more than minimum, and one slow shift. The rush
shifts make up for the slow one.

It's absurd that the system is so opaque.

We need to get rid of the tipping system.

Phillip_McCavity wrote:

I'm sympathetic to this, I don't like leaving tips, and we actually had some restaurants around here that didn't allow them (or gave them to charity).


But lets consider an alternative for argument's sake. I don't know how many restaurant workers you know / routinely associate with, but consider
this. If the restaurant did not allow tips (lets say the prevented people from tipping or giving cash), but put min wage + 20% in a paycheck, would the
servers be happy?

I think they would be miserable. Lots of people's lifestyle depend on a wad of cash they get after every shift. People consider cash differently from money conveyed
by paycheck.


I suspect that the majority of this argument runs along two lines: 1) that servers should be paid more for what is arguably a nasty job, 2) that min wage is too low.

You nailed it with 1 & 2.

I propose a novel Nudge solution:

Getting paid cash daily does absolutely change how people react to that money vs. money they get less frequently via ACH, paper check, etc.

People, on average, almost certainly treat bi-weekly pay more responsibly than daily pay because you have to give thought to how to meter our bi-weekly pay.

I propose that we enforce a tiered minimum wage. $X per hour when paid daily, 1.1x when paid weekly, 1.3x when paid bi-weekly. And it is the choice of the employee not the employer. We have the technology to do it and you are encouraging (nudging) people to make the right choice while also giving people the personal freedom to make the choice that best suits them.

What they need to do is be paid the minimum wage. Period. With tips being extra gifts & thanks for the service, that should absolutely be taxed.

No tax on tips is a stupid grift that will be abused by the wealthy.  The real effect is reducing 80k IRS agents from spending their days bothering 35k waitresses for not reporting all their tips.

Spanky wrote:

You nailed it with 1 & 2.

I propose a novel Nudge solution:

Getting paid cash daily does absolutely change how people react to that money vs. money they get less frequently via ACH, paper check, etc.

People, on average, almost certainly treat bi-weekly pay more responsibly than daily pay because you have to give thought to how to meter our bi-weekly pay.

I propose that we enforce a tiered minimum wage. $X per hour when paid daily, 1.1x when paid weekly, 1.3x when paid bi-weekly. And it is the choice of the employee not the employer. We have the technology to do it and you are encouraging (nudging) people to make the right choice while also giving people the personal freedom to make the choice that best suits them.

Its an interesting idea, although if you are talking about min wage reform, I am most thinking about keeping more marginal people employed, and employed longer.

Something like this: if a business hires an employee in certain categories -- like teenagers, or people who haven't been employed for a while, or over 55 -- and they
stay on the payroll for over 24 months, then the business gets a tax credit that pays for some share of the employee's wages.

Phillip_McCavity wrote:

Its an interesting idea, although if you are talking about min wage reform, I am most thinking about keeping more marginal people employed, and employed longer.

Something like this: if a business hires an employee in certain categories -- like teenagers, or people who haven't been employed for a while, or over 55 -- and they
stay on the payroll for over 24 months, then the business gets a tax credit that pays for some share of the employee's wages.

This is a good idea as well.

I bet there are a lot of good ideas.

But we can't get anything done in this country due to the political climate.

Phillip_McCavity wrote:

Well, this is how California works, min wage for servers.

As for no tax on tips, I'm opposed to that, because I would like all workers of a certain wage to be treated the same, and tips are not a "special wage". Nevertheless,
it made good politics. Food service is a nationwide employer.

I also didn’t see a point in making tips non taxed. Although the online porn industry operates on a 'tipped' bases mostly. That several thousand women that would love to have no gov intvolvement. Enough to sway voting?

One theory.