HOW WOULD THIS IMPACT YOUR RESTAURANT BUSINESS?
In 2024, outside special interest groups are attempting to eliminate the tipped wage that is so important to Ohio's hospitality community. If passed, this measure will nearly triple the amount employers pay tipped employees (tips withstanding).
It could force restaurant operators to reduce or cut employee benefits & insurance, decrease their workforce, raise prices charged to guests or close their doors altogether. Eliminating the tipped wage would be especially harmful to small and independent Ohio restaurants.
CALCULATE THE IMPACT ON YOUR HOSPITALITY BUSINESS
The Tipped Wage Elimination Impact Calculator gives you a snapshot of how your business will be impacted if the tipped wage is eliminated.
WHERE ELSE HAS THIS HAPPENED?
Similar measures have been enacted in seven states and territories. The negative impacts are already being felt by both restaurant operators and employees.
An April 2023 survey published by the Employment Policies Institute of more than 100 local restaurants in D.C. found that because of the elimination of the tip credit, most restaurant operators planned to lay off workers, half planned to expand into lower-cost states such as Maryland or Virginia, and nearly 1 in 3 planned to close locations.
HOW DOES THE TIP CREDIT WORK?
In Ohio, an employer can pay regularly and customarily tipped employees half the starting wage, which is called a “tipped wage.”
Tipped employees are legally guaranteed to earn the full minimum wage, and most earn much more due to tipping.
According to National Restaurant Association data, tipped employees earn between $19 to $41 per hour.
The national average is $27 per hour, or approximately $56,000 per year.