Why Waiters Should NOT Earn Minimum Wage

Part 4 in a series of Why You Must Tip Waiters & Waitresses
Please first read Part 1 here  Part 2 here  Part 3 here

CNN Money article on tipping agrees: 
"15% of bill (excl. tax) for adequate service;
20% for very good service;
no less than 10% for poor service"

For those of you still with me, my thanks. To re-iterate, I don't think you owe me or anybody else a living, but I do feel that we all need to pay people for services rendered. The image here from CNN Money and Emily Post backs up my previous statements on "how much" the appropriate tip for waiters and waitresses is.

You've now learned from my previous posts that waiters and waitresses' employers (the restaurants) really don't pay us diddly-squat, and that possibly 95% of our income actually comes directly from you, the patrons.

My experience shows that this often leads to the line of thinking "Well it shouldn't all be about tips, the restaurants should just pay their servers a decent wage and take the pressure off of the diners to leave them good tips."

TheWorkingGuy.com replies :
Awwwwww! You are just so *CUTE* when you're wrong!

Please let me to explain for ya why that is such a really, really bad idea...

Simple economics, for starters. Federal minimum wage (as of this March 2012 writing) sits at $7.25 per hour. Using the more extreme example of restaurant waiters who - in about 15 states still - only receive $2.13 per hour (the Federal minimum), paying servers "minimum wage" would obviously add $5 per hour to the restaurant's expenses.

Lets say an average busy restaurant has at least 10 servers to pay each shift, on average. Some places have 20, especially at night, others have only five at lunch. Ten's a good median tho, and for this example I'm excluding restaurants that serve breakfast or are open 24 hours (but double my numbers for them.)

A $5 labor cost increase, times 10 employees, means $50 per hour more the restaurant is paying to be in business from 11am-11pm. That's $600 per day. Guess who's going to wind up paying for that additional overhead expense?

YOU.

Do you really want to see your Denny's special go from $4.99 to $7.99 overnight?

$600 per day.. divided by 200 customers per day... Yeah, my math is solid here.

That's what would happen -OR - you could tip $1 (20%) to keep things the way they are.

That's just for starters. The price increase to you would be dramatic in fact. Restaurant owners would actually have to pass on MORE than the $5hr to you though. Why? Because they pay more than $7.25 out of their pockets for each employee than the employee gets paid. Businesses owners have to additionally pay for Medicare, Social Security, Unemployment and in some cases partial benefits as well (all of which would increase for them proportionately, and be passed on to you).

And lest we forget, higher menu prices would result in you paying more sales tax, for every meal.

In any argument against tipping and for businesses being forced to pay higher wages, the only winner is the government, and the diner is the biggest loser. Really, you're getting a bargain as it is today, by at least still having a measure of control over how much to tip, rather than having it all forced upon you by dramatically increased menu prices and increased taxation, IF restaurants had to pay minimum wage.

I truly am saying all of this for you, for your own good, at least as much as my own.

Now, here's another big difference for you ponder, mi amigo, before I write again...

You know what ELSE would happen if restaurants were forced to pay waiters and waitresses minimum wage, and tipping were done away with? I, and probably 90% of servers with any skill or experience at all would leave the profession overnight, because in truth, we make lots more than minimum wage overall. I'll get into that next.

Until then, please think about every good, or great, waiter or waitress you've ever had, and the levels of service you're accustomed to now at at least the semi-nicer places you frequent.

Now replace every one of them with the teenager who greets you at the counter at Burger King, or the worker who comes to "clean up aisle 5" when you knock something over at Wal-Mart.

Imagine a world where the nicest restaurants you could ever go out to on your 20th wedding anniversary are now being staffed by minimum wage workers, and I think some light bulbs will start going on in your head, and the light of truth will begin to dawn a bit more on why you really should be okay with tipping 20% for really good service.

Because the other way around, you're going to wind up paying a lot more, for a lot less.

Hmmmm, I sense the tide turning perhaps. I'm not done, so stick around for my next trick.