this is something that probably isn't clear to people who don't live in the US -- wait staff in the US make around $2-3/hour. they aren't paid a living wage. they rely on tips as their primary source of income, and tips are usually shared with a bartender/busboy.
if a restaurant runs a groupon and all grouponers tip on the post-coupon rate, the wait staff will be taking a rather large pay cut for the length of time that people are grouponing. i know i'd be grumbling if something my company did resulted in me making 50% less for a month or two.
more expensive restaurants and meals mean more expensive tips because the wait staff is more experienced, better trained, higher quality, and do more work. one person at a higher-end restaurant can give high quality service to fewer people than one person at a low-end place, and meals at a higher-end place usually take much longer. yes, the average tip is larger, but the frequency in which they receive tips is lower. yes, they make more, but not that much more.
wait staff in the US make around $2-3/hour. they aren't paid a living wage.
The rules for the U.S. vary from state to state. In Oregon, where I live, wait staff make minimum wage ($8.50 per hour) and tips are added on top of that.
How this works in practice is servers are fired if they do not sign off that they earned the difference in tips. This is a big issue with fast food restaurants like Pizza Hut, and cheap buffets where there is a lunch rush and then a slow period, coupled with a propensity of patrons of this sort of place not to tip because they think it is a buffet or fast food restaurant, not one where servers are paid $2.35. Often you have slow periods where there might not be any customers. Let's say from 1-5pm at Pizza Hut you have 3 tables and each leaves $1. So you made $3 in a 4 hr part time shift. You get paid $2.35 * 4 = $9.40 for those three hours. If minimum wage in your state is $8.25, you are required to report that you made $23.60 in tips during that period, not $3. You then pay various taxes on those phantom wages, notably social security and medicare tax, which are regressive flat taxes. You also may find yourself being forced to split the phantom wages with the dishwasher and manager. Often you make less than $0 during your shift. Some people can make up the difference during the dinner and lunch shifts, but those usually go to senior employees and the more attractive women. Getting more than 4-6 hrs a day is hard because then you are no longer a part time employee, which means the employer might have to start paying benefits, which would ruin their entire business model that relies on $2.35/hr wages and no benefit costs. Talk to anyone who works at Pizza Hut or most buffet chains to hear more about this in great detail, I have heard about this situation from dozens of people over the last 30 years.
I'm sorry you've had that experience. I've worked as a waiter, and was never pressured to report anything other than what I made. I'm not advocating for poor tipping, I was just clarifying for those not in the US how the law is written.
Waiters and waitresses typically make more than minimum wage, once tips are taken into account. A cut in tips due to Groupons yields an effective cut in salary. Minimum wage is just the floor.
wait staff in the US make around $2-3/hour. they aren't paid a living wage.
Not true. That's why we have federal minimum wage laws. If the wait staff are actually employed and not acting as independent contractors, then they are paid the minimum wage for their state. (Although I will grant that this being a living wage is definitely arguable.)
Edit: Correction - although not California (my state), apparently some states do allow minimum wages in the $2-3 range if employees receive tips [1]. For the downvoters, I only count about 5 states that do this, however. The original statement does not accurately reflect the majority of the U.S.
Question: Is it legal for waiters and waitresses to be paid below the minimum wage?
Answer: According to the Fair Labor Standards Act, tipped employees are individuals engaged in occupations in which they customarily and regularly receive more than $30 a month in tips. The employer may consider tips as part of wages, but the employer must pay at least $2.13 an hour in direct wages.
An employer may credit a portion of a tipped employee's tips against the federal minimum wage of $7.25 per hour effective July 24, 2009. An employer must pay at least $2.13 per hour. However, if an employee's tips combined with the employer's wage of $2.13 per hour do not equal the hourly minimum wage, the employer is required to make up the difference.
The employer who elects to use the tip credit provision must inform the employee in advance and must be able to show that the employee receives at least the applicable minimum wage (see above) when direct wages and the tip credit allowance are combined. If an employee's tips combined with the employer's direct wages of at least $2.13 an hour do not equal the minimum hourly wage, the employer must make up the difference. Also, employees must retain all of their tips, except to the extent that they participate in a valid tip pooling or sharing arrangement.
So, although waiting tables is - predictably - not a great job, nearly all waitstaff in the US will be making 7.25/h as you would expect from federal minimum wage? And contrary to what most people attempt to convince me?
Coming from a country with a culture of smaller tips and significantly less social pressure to give them, I usually say that I should not be forced to make up for the employer's false advertising when receiving only mediocre service. This now seems correct - not tipping wi make the employer pay the remainder, not force the waitstaff on to the streets. Right?
Nearly all waitstaff in the US will be making more than 7.25/h. If "not tipping" suddenly became endemic, I imagine plenty of waitstaff would be forced "onto the streets".
"Tipped workers" are paid under different rules, and it varies state by state. They typically have a minimum cash wage ($2.13 federally and in NY for example) and an hourly "tip credit" ($5.12 fed/in NY) to bring them up to standard "minimum wage" ($7.25). They only get paid $2.13 an hour by their employer.
Actually this is true. Average tips are calculated when determining hourly wage. I worked as a server for 4 years in high school/college. My hourly wage was about $4/hr while the minimum in Florida was $6.25. My paychecks mostly went to paying taxes on my tips.
yes, you're right, what i said wasn't fully true for expediency's sake, but your statement isn't fully true either. federal minimum wage laws don't apply to tipped workers in the same way (iirc, it varies based on the state, i'm not sure).
if an employee doesn't at least make minimum wage after tips are considered, an employer is required by law to compensate an employee up to the point where they do make minimum wage. in theory.
if a restaurant runs a groupon and all grouponers tip on the post-coupon rate, the wait staff will be taking a rather large pay cut for the length of time that people are grouponing. i know i'd be grumbling if something my company did resulted in me making 50% less for a month or two.
more expensive restaurants and meals mean more expensive tips because the wait staff is more experienced, better trained, higher quality, and do more work. one person at a higher-end restaurant can give high quality service to fewer people than one person at a low-end place, and meals at a higher-end place usually take much longer. yes, the average tip is larger, but the frequency in which they receive tips is lower. yes, they make more, but not that much more.