The truth about raising Maryland’s minimum wage

By Larry Stafford

Executive Director, Progressive Maryland

A recent Gonzales poll shows that 60% of Maryland voters support a $15 minimum wage, which tracks with a Goucher poll from last month, which showed support at 67%.

Raising the state’s minimum wage from the current $10.10 to $15 by 2023 has widespread support from voters who know that the basement wage is too low, forcing workers and their families to live in poverty.

MarylandReporter.com , however, and other publications have also reported on a paid question added to the poll by the Restaurant Association of Maryland (RAM), asking respondents if they would support an increase if it would increase costs and cause job loss.

Fake questions get fake answers

This additional question caused support to plummet but that’s not news. When you ask a fake question, you get a fake answer. The poll is presented as if it were unbiased and scientific, rather than informed by misleading questions designed by lobbyists to deliver the results they want.

There’s nothing to support RAM’s claims — years of the most rigorous economic studies show that raising the minimum wage doesn’t lead to job loss. Yet that doesn’t keep the RAM from misstating the facts of raising the wage. The truth is that the RAM is a leading driver in keeping Maryland wages artificially low for tipped workers.

During the 2014 campaign to raise the state’s minimum wage to its present $10.10, the RAM succeeded in lowering the rate for tipped workers, which had previously been half of the minimum wage. Instead of rising to $5.05, the RAM convinced lawmakers to freeze the rate at $3.63. And tipped workers aren’t just restaurant workers; the RAM also set back car wash attendants, nail salon employees, hairdressers, massage therapists, and other people who work for tips.

Legislators should know the facts about the benefits of raising the wage and act on behalf of Marylanders, not lobbyists who are keeping wages low because they think it will keep profits high for their members.

Lobbying to protect tipped wages

The RAM is the state affiliate of the National Restaurant Association (NRA). Together, they spend millions to lobby to keep wages down. In 1996, the NRA successfully lobbied Congress to exclude tipped workers from a minimum wage increase (to the current national rate of $7.25), permanently freezing the tipped wage at just $2.13 per hour.

While NRA and RAM memberships include small restaurant owners, their influence and funding mostly come from industry giants like McDonald’s, YUM! Brands (the owner of Taco Bell and KFC), Disney, and Darden Restaurants (the owner of Olive Garden, LongHorn Steakhouse, and Capital Grille).

Last year, the NRA was behind a campaign to kill Initiative 77, a District of Columbia ballot measure to raise the minimum wage for tipped workers to $15 by 2025. Hiding behind the appearance of a left-leaning grassroots campaign called Save Our Tips, they claimed that enacting the policy would lead to loss of tips and jobs and cause restaurant closures.

Here in Maryland, the RAM brings out workers who work at white tablecloth restaurants to testify before the General Assembly. These workers say their wages are adequate and that they’re afraid their tips would decrease if their pay increases. These workers are a small minority within the larger universe of tipped workers and there is no evidence to support the latter claim, just fear-mongering.

Wage theft

Here’s the reality of working for $3.63 per hour. Employers are supposed to ensure that these workers make the full state (or local prevailing) minimum wage but many do not. Wage theft (or nonpayment) is prevalent. According to the US Department of Labor’s Wage and Hour Division, almost “84 percent of full-service restaurants it investigated between 2010 and 2012 had violated labor standards.”

Workers who request their full legal salary can find themselves getting fewer and less profitable shifts, or left off work schedules altogether. And most tipped workers — predominantly women and workers of color — live in poverty and are twice as likely to depend on food stamps as the general population.

Tipped workers are vulnerable to unpredictable drops in pay as tips fluctuate from shift to shift.

When wages are artificially low, it’s not just the workers who suffer — we all do. Nearly 67 percent of Americans who receive public assistance are in a family with at least one working adult. We are subsidizing big business profits through social services. Low wages put stress on individuals, families, and whole communities that struggle when people can’t earn a fair wage.

Finally, raising wages for tipped workers doesn’t harm restaurants. In fact, research shows restaurants benefit when workers make more.

California eliminated its tipped wage and workers now earn a median wage of over $12 per hour while restaurants reported an annual sales increase of over five percent. Restaurants are thriving in the seven states with no tipped minimum wage (California, Oregon, Washington, Alaska, Nevada, Montana, and Minnesota).

When debating important policy changes, it’s vital to have the facts to make an informed decision. Deceptive practices like those practiced by the RAM should cause policymakers to question their motives and doubt their so-called facts.

Larry Stafford is the executive director of Progressive Maryland, a statewide nonprofit advocacy organization, promoting social, economic, and racial justice.

Maryland Reporter

MarylandReporter.com is a daily news website produced by journalists committed to making state government as open, transparent, accountable and responsive as possible – in deed, not just in promise. We believe the people who pay for this government are entitled to have their money spent in an efficient and effective way, and that they are entitled to keep as much of their hard-earned dollars as they possibly can.

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