Why Workers Receiving Tips Shouldn’t Be Paid Less

By Jordyn Bussey, a Fall 2014 Leadership Conference Education Fund Intern

The National Women’s Law Center (NWLC) released an analysis last week revealing that states with the same minimum wage for all workers – regardless of whether the workers receive tips – have lower poverty rates for workers who receive tips (“tipped workers”) and a narrower wage gap for women.

NWLC’s analysis is a good reminder that – for almost a quarter century – the minimum wage for tipped workers has remained at $2.13 an hour, though many states have set their own standards. In the eight states that have eliminated a lower minimum wage for tipped workers, women working full time, year round are paid 80 cents to the dollar of their male counterparts on average – a wage gap of 20 cents, which is 17 percent smaller than the 24-cent gap in the states maintaining the federal tipped minimum wage. The gap narrowed even further for African-American and Hispanic women.

These numbers are hard to ignore, and higher wages benefit more than just the individuals doing the work. As NWLC’s analysis says, raising the federal minimum wage for tipped workers is “a crucial step toward fair pay for women and economic security for their families.”