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Because the employee tips are effectively taken by the restaurant up to the point where they make "normal" minimum wage. If tipped employee compensation was act
by bastawhiz 2y ago
Because the employee tips are effectively taken by the restaurant up to the point where they make "normal" minimum wage. If tipped employee compensation was actually about compensating those folks for their effort, they should received the tips they earn. (Tipped minimum wage gets increased to standard minimum wage if you earn fewer than the difference in tips—which is functionally identical to having $5 and a bit of your tips withheld every hour)
As it stands today, if you're tipped and you work a shift where there are fewer customers, you implicitly get paid less (and have more of your tips soaked up by your employer) for exactly the same amount of effort. If you work a graveyard shift for eight hours and see $40 in tips from eight customers, you effectively worked minimum wage with $0 in tips, not minimum wage plus $40. For the people working those jobs, that's multiple meals or tank of gas.
There's no practical reason for having a lower minimum wage for tipped employees, it's literally just an excuse for employers to pay their tipped employees less. If we as a society actually believed that some professions should be compensated based on effort, there would be a different minimum wage for people compensated by commission. But that doesn't exist.
So to answer your question, you're not necessarily "directly compensating" the employee, because a non-trivial percentage of your tip goes towards subsidizing their employer.
- CalRobert 2y agoThis varies by state, though.