Essential Wages

An analysis of New York State’s proposed elimination of the tipped minimum wage and its impact on low-wage women workers

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Key Findings
  • Approximately 433,000 New York workers across hospitality, personal service, and other occupations where tipping is common would benefit from raising the tipped minimum wage.
  • 73% of New York’s tipped food service workers are waiters and bartenders. Nearly two-thirds are women, and nearly half of these women are women of color.
  • 56% of waiters and bartenders currently make less than $15 per hour. A quarter of these women earn less than 1.5 times the federal poverty line.
  • The majority of women of color in these two occupations would see annual gains of roughly $9,100 a year.
  • Most women waiters and bartenders would see their annual income rise more than 40% over their current earnings.
Information:
New York’s One Fair Wage Act
Assembly Bill 02244 / Senate Bill 00808

New York’s One Fair Wage Act (Assembly Bill 02244/Senate Bill 00808) seeks to amend the State’s minimum wage law to eliminate the lower minimum cash wage for tipped workers. It requires that all employers pay tipped employees the state’s full regular minimum wage—$15 per hour for most of the state’s workers—by 2026.

The Gender Equity Policy Institute conducted an analysis of the potential impacts of New York’s One Fair Wage Act by gender, race, and ethnicity.

The current tipped minimum wage leaves many of these workers struggling to make ends meet. For example, women waiters’ earnings are only 45 percent of the national median income—they are even lower compared to New York’s relatively high median income.

With previous legislation in New York that increased the minimum wage to $15 per hour for fast food workers and the governor’s 2019 executive order on miscellaneous tipped workers, food serving staff in restaurants and hotels are the principal groups still subject to the subminimum tipped minimum wage.

These workers, like so many other minimum wage workers, are disproportionately women and women of color. Among the lowest paid tipped food service workers, women are overrepresented— especially Asian and Black women. The gender pay gap in the New York food service industry is large and wider than the national gender wage gap.

Raising the wage to $15 per hour and eliminating the separate, lower tipped minimum wage would be a major step toward raising incomes in occupations in which women and people of color are overrepresented and underpaid. The measure rectifies systemic racism and sexism by tackling the ongoing effects of prior legally codified pay discrimination in American minimum wage laws. It tackles longstanding and stubborn inequalities that diminish the opportunity and well-being of large numbers of people, especially women and women of color.

The Gender Equity Policy Institute’s analysis of New York’s One Fair Wage Act found that the bill meets almost all the criteria for advancing gender, racial, ethnic, and intersectional equity. The Act received a score of 93 percent, earning it recognition as a model bill on gender equity action.