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Southern Tier Lawmakers, Restaurant Owners, Employees Oppose Governor's Proposal To End Tip Wage Credit

CORNING, NY (WSKG) - Southern Tier lawmakers are voicing their opposition to Governor Andrew Cuomo's proposal to eliminate the minimum wage tip credit.

Corning Assemblyman Phil Palmesano joined fellow Assemblyman Chris Friend and State Senator Tom O’Mara, both of Big Flats, at a press conference on Wednesday in Corning. The Republicans were joined by restaurant owners and employees.

The tip credit is part of the phase-in of the $15 per hour minimum wage. In upstate New York this means employers may pay their tipped workers $7.50 per hour with a $2.90 per hour tip credit for a total equalling the current upstate minimum wage of $10.40 per hour.  The minimum wage in New York City and Long Island are different.

If tipped workers actual wages fall short, employers make up the difference. The elimination of the tip credit would require restaurant owner to pay the full hourly minimum wage. 

A restaurant owner asked what problem this proposal was meant to solve.  State Senator Tom O’Mara called it a solution in search of a problem.

"I believe the unintended consequences of this type of drastic action is gonna far outweigh any benefit a worker will see," O'Mara added. "I think it will be just the opposite. It’ll be a negative effect."

According to one restaurant industry organization, the average income for tipped workers is between $15 and $25 an hour under the current system.

Southern Tier restaurant owners said they will lose employees and business. Supporters of keeping the tip wage credit used Maine as an example of what happens if its eliminated. In that state, servers organized in opposition when the tip wage credit was eliminated..

Nicole King works as a restaurant bartender, server and on the kitchen staff. She's currently finishing a law degree and is a single mom.

King said the current system lets her go to college and support her family. "Destruction of small businesses means destruction of the employees that work for them," King added.

Tipped workers are concerned jobs and income will be lost if the tip credit is eliminated and restaurants costs increase.

A recent survey by Souther Tier State Senator Fred Akshar asked if New York should require restaurants, hotels and bars to pay the full minimum wage to tipped wage workers. 50 percent replied "Yes". Akshar was not part of the press conference yesterday.

The New York State Department of Labor will be holding public hearings beginning April 20. The hearings are expected to last until late June.