Restaurant servers and other workers who make tips can currently be paid less than minimum wage as long as their pay plus tips exceeds minimum wage.A proposed law voters will see on their Arizona ballot next month would allow employers to pay those workers a little less in most cases.The ballot measure is Proposition 138, also known as the Tipped Workers Protection Act. But it’s an idea brought by employers, not workers. They say what’s protected is the ability to pay less for tipped workers and, in turn, the jobs workers rely on. The measure would also prevent people working under the lower pay scheme from making less than minimum wage plus $2 per hour.Here’s what the measure would do if voters approve it:Under current state law, employers can pay tipped workers, like restaurant servers, up to $3 per hour less than the prevailing minimum wage.Proposition 138 lowers that “tip credit” to 25% of the prevailing minimum wage. But to take advantage of the law, employers have to promise their tipped workers they’ll never be paid less than minimum wage plus $2 per hour when factoring in tips.How would the law affect workers’ pay?The minimum wage is currently $14.35 an hour. Current law allows a $3 deduction for tipped workers, bringing their base down to $11.35.If voters approve Proposition 138, employers could deduct 25% from the minimum wage and pay tipped workers $10.76 an hour, under the current minimum wage. Workers who have a bad tip week and average less than $16.35 an hour, when combining the $10.76 and their tips, would be guaranteed at least $16.35 an hour — which is minimum wage plus $2.Many tipped workers make over $16.35 an hour when factoring in their tips, however. Those workers would lose money under the proposed tip credit. The U.S. Bureau of Labor Statistics reports that in May 2023, Arizona waiters and waitresses were paid a mean hourly wage of $23.60, the fifth-highest rate in the country.Who is supporting and opposing Proposition 138?A 2016 state law boosted the minimum wage and mandated it go up each year as the cost of living rises, raising the labor costs for restaurants and bars. Raise the Wage AZ, a pro-labor organization connected to the national One Fair Wage group, this year attempted to put a measure on the ballot raising the minimum wage nearly to $18 over three years and eliminating the tip credit entirely. Supporters failed to collect enough signatures, forcing the group to end its campaign.Restaurant owners and the Arizona Restaurant Association argue Proposition 138 is necessary to preserve a tip credit in the state constitution, protecting it from measures similar to the one proposed by Raise the Wage. Other supporters include the Arizona Chamber of Commerce, which chipped in $9,000 to promote the measure, and the Save Our Tips AZ political action committee.The PAC has collected just shy of $300,000 for campaign ads and other needs, state records show. More than $217,000 has come from the Arizona Restaurant Association.Why do opponents use an obscenity in their signs?Jeanne Woodbury, an activist who works with the lobbying firm Creosote Partn …
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