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  September 24, 2013

Minimum wage for tipped workers has been kept at $2.13 for 21 years

Author Saru Jayaraman exposes exploitative restaurant industry fraught with racism, sexism, and horrible labor practices.
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Saru Jayaraman is the Co-Founder and Co-Director of the Restaurant Opportunities Centers United (ROC United), Director of the Food Labor Research Center at University of California, Berkeley and Co-Founder of the consumer engagement campaign, The Welcome Table. She authored Behind the Kitchen Door, a groundbreaking exploration of the political, economic, and moral implications of dining out (Cornell University Press, 2013).


JESSICA DESVARIEUX, TRNN PRODUCER: Welcome to The Real News Network. I'm Jessica Desvarieux in Baltimore.

Fast food and retail workers have grabbed headlines in recent months, going on strike because they say the minimum wage of $7.25 an hour is not a living wage. But less attention has been focused on a group of about 10 million workers who make as little as $2.13 an hour. That is the federal tipped minimum wage for restaurant workers.

We're joined with our in-studio guest, Saru Jayaraman. She's the cofounder and codirector of the Restaurant Opportunities Centers United and the director of the Food Labor Research Center at UC Berkeley. And her new book is titled Behind the Kitchen Door.

Thanks so much for joining us, Saru.


DESVARIEUX: So, Saru, first tell us how--we're talking about $2.13 of wages that people are paid hourly. How long has this been going on?

JAYARAMAN: So, actually, back in 1996, the National Restaurant Association, which has been named the tenth most powerful lobbying group in Congress and which we call the other NRA, struck a deal with Congress saying that they would not oppose an increase to the overall minimum wage as long as the minimum wage for tipped workers stayed frozen forever. And so it has been stuck at $2.13 an hour.

And what's really important to understand is that we're talking about the second-largest and fastest-growing private sector employer in the United States. It's over 10 million workers. One in 12 Americans right now works in the restaurant industry. It's one of the only industries to grow over the last couple of years of economic crisis rather than decline.

But it's also the absolute lowest-paying employer in the United States. So seven of the 11 lowest paying jobs in the U.S. and the two absolute lowest paying jobs are restaurant jobs, which means that you've got the largest and fastest growing industry in the United States proliferating the absolute lowest-paying jobs because of these behind-closed-door deals that the NRA has struck decade after decade with Congress and with local and state legislatures across the country.

DESVARIEUX: Okay. And can you talk a little bit about your membership and your members? And how are they able to even survive on $2.13?

JAYARAMAN: Right. So, for example, I have a new book out called Behind the Kitchen Door, and in the book I describe a story of a worker named Claudia Muñoz, who is actually a leader in our organization, immigrant from Mexico, very intelligent woman, ended up going to graduate school in Texas, worked at the IHOP while she was in graduate school, earning $2.13 an hour in Houston, Texas.

Now, the law says that the employer is supposed to make sure that tips make up the difference between $2.13 an hour and the regular minimum wage of $7.25. But the IHOP, megacorporation that it is, and even though it is illegal, told Claudia, we're not going to be held liable to make sure that tips make up the difference; we're going to report that you're earning $7.25 regardless of what you earn. And so Claudia would earn sometimes $3 in tips, sometimes $4 in tips, sometimes zero in tips an hour when she was doing side work or something else. And yet she was being taxed at $7.25 an hour. When you get a wage of $2.13, you literally get a paycheck that says, this is not a paycheck, it's a zero, because your wages are so low they go entirely to taxes.

Now, women--and I say women because 70 percent of tipped workers in America are actually women who work at the IHOP and Applebee's and Olive Garden and Red Lobster--they suffer from three times the poverty rate of the rest of the U.S. workforce, and they use food stamps at double the rate of the rest of the U.S. workforce, which means the women who put food on our tables cannot afford to eat themselves.

And this was Claudia's situation. She was so poor because she earned so little and not enough in tips that she would literally starve and come to the restaurant and wait to eat pancakes at the restaurant. And she said, Saru, I'm ashamed to admit it, but I would sometimes go to the restaurant, and like the other women who worked there, we would flirt with the management or the cooks to get extra food to eat because we were so hungry.

DESVARIEUX: They would flirt with them to get extra food to eat?

JAYARAMAN: Because they were so hungry, because they could not afford to buy food outside of coming to the restaurant and eating whatever scraps they'd be given at the restaurant. And Claudia says, you know, one night she worked a full night's shift at the IHOP in Houston Texas, earned some money in tips, but at the end of the night, a couple walked out without paying the bill, and the IHOP, megacorporation that it is, and even though it is illegal, told her she'd be responsible for paying that bill, which was $20 more than everything she had earned that entire night, which meant Claudia paid $20 for the luxury of having worked a full night's shift at the IHOP in Houston, Texas.

And that might sound like an extraordinary story. Well, I can tell you I've heard that same story from thousands and thousands of people across the country. And, in fact, the U.S. Department of Labor reports an 84 percent violation rate with regard to employers actually making sure that tips make up the difference with regard to the tipped minimum wage versus the regular minimum wage. I mean, the very fact that the median wage of these workers is about $8 an hour including tips lets you know that these are workers living in severe poverty, not able to afford to eat.

The fact that actually they're having to live on food stamps means that we as customers and taxpayers are subsidizing this multibillion-dollar industry in multiple ways. The first way is that the industry has basically said to Congress and the American people, we should be the only industry that doesn't have to pay our own workers' wages. You customers, you should pay our workers' wages for us. And then on top of that, these workers are so poor that we as taxpayers are subsidizing their--you know, the employer's not having to pay these wages, because these workers are so reliant on food stamps and other forms of public assistance.

DESVARIEUX: Let's talk more about those employers, those megacorporations like IHOP you mentioned, and the other NRA, the National Restaurant Association. They argue that this $2.13 an hour wage, no one gets paid this. They're saying that--essentially that they make a lot more than that and we shouldn't be concerned about this $2.13 an hour wage. What is your response to that?

JAYARAMAN: My response is: look at the government data. The government data says the average wage for servers in the United States is about $8 an hour, that servers suffer from three times the poverty rate and use food stamps at double the rate of the rest of the U.S. workforce. If the average is $8, that means at least half of the population is earning less than that. The restaurant industry is the largest employer of workers who earn less than the federal minimum wage of $7.25 an hour, including tips. So you just have to look at government data to know that's actually not true. Even with tips, these workers are eking out, barely eking out a living, not able to support their families, not able to feed themselves. You know, you just have to look at the data.

DESVARIEUX: Yeah. And when you look at the data, though, you would think that you could come up with some compelling arguments there on Capitol Hill to convince people that you should be pushing for a living wage. Can you talk more about this strong lobbying on the Hill by the NRA? What kind of influence do they have?

JAYARAMAN: So the National Restaurant Association, as I said, has been named the tenth most powerful lobbying group in Congress. Every year, they descend on Capitol Hill in April, taking about 400 or 500 corporate lobbyists from McDonald's and Burger King and Olive Garden and Red Lobster. They meet with every single senator and congressperson. And they've managed to keep the wage at $2.13 an hour for the last 22 years. They've also managed to win exceptions for themselves in every state and local legislature over the last many decades, which means that they wield tremendous influence at the national level, at the state level, at the local level, both on the issue of wages and on the issue of benefits.

So, recently the National Restaurant Association got together with ALEC, the American Legislative Exchange Council, and Darden, the world's largest full-service restaurant company (which is Olive Garden, Red Lobster, Capital Grille steakhouse, LongHorn Steakhouse, and about eight other brands. These three entities, NRA, Alec, and Darden, introduced bills in 14 states saying that they should be able to preemptively prohibit any localities in those states from passing local paid sick days ordinances. They've passed in eight states, which means now in the state of Florida, Wisconsin, Arizona, and five other states, citizens in Miami, Phoenix, Milwaukee actually do not have the right anymore to democratically vote for a paid sick days ordinance.

And this is a public health--beside a constitutional disaster, this is a public health disaster. Ninety percent of restaurant workers in America do not have paid sick days, which means--.

DESVARIEUX: Ninety percent.

JAYARAMAN: Ninety percent, which means that two-thirds report cooking, preparing, and serving our food when they're sick with illnesses ranging from H1N1, better known as swine flu, to hepatitis A (actually, several hepatitis A outbreaks at the Olive Garden from sick restaurant workers), to typhoid fever (we have a member in Miami, Florida, who's worked several weeks with typhoid fever serving customers), to what's called norovirus, or stomach flu outbreaks. The Center for Disease Control has said that 50 to 90 percent of all stomach flu outbreaks, norovirus outbreaks in the United States can be traced back to sick restaurant workers. They've also said that over one in ten restaurant workers report actually experiencing severe vomiting and diarrhea on the job due to lack of paid sick days.

I mean, I could go on and on. It's really disgusting. These are public health issues. But they also impact these workers' lives. These workers have children. When the children are sick, they're not able to take a day off to take care of them. We had a member in Los Angeles named Gloria who worked at the Burger King, and they called her to tell her that her daughter had had an unnatural heart attack at the age of 12. Now, Gloria was told she'd be fired if she left. She had to choose, essentially, between her job, which would pay for her daughter's livelihood, and her daughter's life.

And these are the kinds of choices that restaurant workers have to make every single day, because when you earn a wage of $2.13, you are living off of your tips, you're living off the largesse of a buying public, which puts you at the mercy of having to go to work every day to get those tips, of allowing people to touch you and treat you and talk to you in inappropriate ways, so that our industry, 7 percent of American women work in our industry, 37 percent of all sexual harassment claims to the EEOC come from the restaurant industry, because it is an industry so ripe with women being exposed all different kinds of treatment and left at the mercy of people who are essentially paying their incomes when they come to the restaurant.

DESVARIEUX: Well, the average American, people do like to go out. They like to eat out. What can you do in this situation? How do you fight against something like this?

JAYARAMAN: This is a great question. We have actually developed a whole consumer engagement campaign so people who eat out, which is almost every one of us, can do something.

So the first thing we recommend is please get the book, read the book, educate yourself. It's called Behind the Kitchen Door. And just as Michael Pollan's book Omnivore's Dilemma and Eric Schlosser's book Fast Food Nation opened consumers' eyes to the world of sustainable locally sourced organic food and resulted in consumer demand that actually changed our industry, we now need people to read this book and, as consumers, demand the same kind of change. That's number one.

Number two, we've actually created a website called where consumers can go, sign a petition asking to raise this abysmally low minimum wage of $2.13 an hour. On that website you can also find a smartphone app for our ROC National Diner's Guide, which actually tells you how restaurants around you are faring on these issues of wages and benefits and promotions.

But the third and most important thing that you can do as a consumer is to speak up at the end of your meal, wherever you eat, whenever you eat, to go up to the manager and say, I love the food, I love the service, I would love to see you provide a livable wage, not $2 or $3 or $4 an hour depending on the state you live in, but a livable base wage, paid sick days for your workers, and opportunities for people to move up the ladder. These things are important to me as a paying customer.

DESVARIEUX: Okay. Well, thank you so much for joining us, Saru.

JAYARAMAN: Thank you.

DESVARIEUX: And thank you for joining us on The Real News Network.


DISCLAIMER: Please note that transcripts for The Real News Network are typed from a recording of the program. TRNN cannot guarantee their complete accuracy.


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