How Tip-Based Pay Discriminates

Saru Jayaraman

The restaurant industry is one of the largest and fastest growing sectors of the American economy, and it is also the lowest paying—and has been since restaurant owners were allowed to hire free slaves after the Emancipation Proclamation of 1863 for no pay, forcing them to live on customer tips.

Tip-earning employment has persisted to this day, affecting more than 11 million workers. Saru Jayaraman, a food labor researcher at the University of California-Berkeley and co-director of Restaurant Opportunities Centers United, told us why we should care at this fall’s Honors Colloquium, “Inequality and the American Dream.”

What sparked the idea to found Restaurant Opportunities Centers United and what was your biggest challenge getting it off the ground?

We founded Restaurant Opportunities Centers United as a relief center after the terror attacks of September 11, 2001, together with displaced World Trade Center restaurant workers. It quickly grew into so much more as a result of demand—there had never been a center for restaurant workers before in New York City.

How does low-wage tip employment disproportionately affect women and minorities?

Seventy percent of tipped workers in America are women, and disproportionately women of color. They face the worst sexual harassment of any industry because they have to tolerate inappropriate customer behavior to earn their income in tips.

Does the One Fair Wage legislation you advocate face a significant challenge from inertia, and the generally accepted American custom of tipping?

No. The campaign is not to eliminate tipping—it is to eliminate the lower wage for tipped workers. The seven states that have already done this face higher restaurant sales per capita, faster growth among servers and all restaurant workers, and higher rates of tipping than Rhode Island and the 43 states with lower wages for tipped workers. The challenge comes from the money, power and influence of the National Restaurant Association, which seeks to keep wages as low as inhumanely possible. Americans, when they learn about this issue, generally are outraged that their tips are subsidizing multi-million dollar corporations.

Given its roots in slavery, why do you think low-wage tip employment continues to this day?

Money, power and the influence of the industry trade lobby.


Photo: Mike Salerno