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Will Elimination of Tipping Reduce Wage-And-Hour Risks?

by Jordan Bernstein and Rana Nader
CH&LA Industry Newsletter
March 31, 2015

Jordan Bernstein and Rana Nader's article, "Will Elimination of Tipping Reduce Wage-And-Hour Risks?" was published in the CH&LA Industry Newsletter on March 31, 2015.

From the article...

"With minimum wage increases already taking effect around the country, and the threat of tip credit-related lawsuits, many in the restaurant and hotel industries are rethinking the use of tipped-based compensation models for their employees.

The Increasing Minimum Wage
The New York State Department of Labor’s Wage Board just recently passed a 50 percent increase in the minimum hourly wage for tipped workers — from $5 to $7.50. The New York State Restaurant Association has argued that the wage hike will hit small businesses hard, and has reasoned that despite New York’s tip credit allowance, restaurants will see their payroll for tipped employees increase by 50 percent, which will inevitably force them to eliminate up to one-fifth of their tipped employees."