My 19-year-old daughter, who is back home from the University of Victoria until September, has found a summer job as a hostess at a well known B.C. restaurant a couple of blocks from our house. She’ll be working four- to six-hour shifts, three or four days a week.
She’ll get minimum wage, which was $8 an hour until April 30, when it went up to $8.75 an hour. But she expects to move into waitressing, where she can make far more money from tips.
A good chunk of my legal practise involves work for restaurants and hotels, and I have fielded more than a few calls from angry clients bemoaning what will be, by this time next year, a 28-per-cent increase to the province’s minimum wage. B.C. has had the lowest rate in Canada for most of the past decade, and even at $8.75 an hour, it’s still the lowest in the country. In a year, it will be increased to $10.25 an hour.
Minimum wage is a tricky issue to discuss rationally in public – it's hard to defend paying someone the lowest amount legally possible without getting angry letters to the editor or threats to your personal safety. But in a perfect world, nobody would ever have to pay the minimum wage because no-one would ever work for it. In Alberta during the boom years, retail businesses closed down because they couldn’t find anyone prepared to work for $8.80 an hour when they could make 10 times that amount in the oil patch.
My restaurant clients tell me the increase in B.C. is unfair because many of their workers aren’t there for the minimum wage, they're there for the tips. So why increase it holus bolus for an industry where many workers are, in effect, getting bonuses directly from customers?
They have a good point.
I recall in the early '80s, when I was putting myself through law school working at The Keg, I didn't care about the $3.25 an hour I made waiting tables. I was in it for the $100 to $150 I could make every night in tips. The minimum wage was so irrelevant, some servers had to be reminded that two months' worth of their paycheques were patiently waiting to be picked up in the office.
Thirty years later, my daughter isn’t making the $100 to $150 a night her dad used to make, but she, like other non-serving restaurant workers, benefits from tip pools even though she doesn’t get money directly from customers. Factoring that in, her wage increases by about an extra $1 an hour. For other restaurant workers, it can be more.
All restaurant systems that I do legal work for have some form of “collective tip pool” requiring servers (who collect the cash and the tip) to contribute a percentage of their sales to the “pool” for distribution down the line to the non-serving (and thus non-cash-collecting) staff. This includes cooks, bussers, bartenders, hosts, dishwashers, and others who may have made the evening just as rewarding for customers (and just as important to the success of the restaurant) as the servers.
I recently read a report by the Fraser Institute on increases to the minimum wage. The Fraser Institute is accused of being a “right-wing” think tank almost as much as the Centre for Policy Alternatives is accused of being a “left-wing” one. But just because a right-wing think tank collected some interesting data and made some provocative conclusions doesn’t mean the report should be dismissed as propaganda.
The data is revealing. And after all, data is data, irrespective of one’s ideological leanings. The findings surprised me.
The study found that in 2010, only 40,800 B.C. workers earned minimum wage, and this represented a mere 2.2 per cent of the province’s total work force. Moreover, 58.6 per cent of minimum wage workers in BC were between the ages of 15 and 24, and only 3.5 per cent of workers aged 20 to 24 earned minimum wage.
The majority of minimum-wage earners were not adults trying to support their families, they were teenagers and early twentysomethings living with their parents. Of the 40,800 workers earning minimum wage, 22,700 – or 55.6 per cent – lived at home with their families, and of those workers, half (55.5 per cent) were aged 15 to 24 and attending school. So an increase to the minimum wage, the authors claim, benefits a majority of people who are less likely to need it.
