Labor Committee to Hold Public Hearing on Tip Credit Bills

Krysta West
Communications Director
Senate Republican Office
(207) 287-1505

Labor Committee to Hold Public Hearing on Tip Credit Bills

Who: Labor, Commerce, Research & Economic Development Committee
What: Public hearing on LD 673, “An Act To Restore the Tip Credit to Maine’s Minimum Wage Law,” LD 702, “An Act To Restore the Tip Credit to Maine Employees,” and LD 831, “An Act To Base the Minimum Wage on a New England State Average and To Restore the Tip Credit.”
Where: Cross Building, Room 208
When: 10:00 AM & 1:00 PM, Wednesday, April 5

“Of all the things going on in Augusta, the tip credit is one of the issues that I’ve heard the most about from constituents and restaurant owners in my district,” said Sen. Roger Katz (R-Kennebec), sponsor of LD 673. “That’s because this new law fundamentally changed the server-customer dynamic in restaurants all across Maine and is already causing some significant misunderstandings. Proponents of this provision sold it to the voters as a way to increase wages for these individuals, but it has actually decreased wages in many cases as customers have begun to tip less, resulting in a much lower hourly wage.

“The elimination of the tip credit is also detrimental to restaurant owners, who already operate on razor thin margins. It is already forcing them to raise prices, reduce hours, eliminate benefits, reduce pay for back-of-the-house staff, switch to a computerized business model, eliminate positions or take a significant hit.

“Many Mainers have earned a very decent wage working in restaurants and bars for tips which are often times significantly higher than the minimum wage. But this new policy threatens that, hurts our businesses and will result in higher menu prices and a lower quality in service for the consumer.”

“The new minimum wage law puts Maine at a serious disadvantage, both on a regional and a national scale,” said Sen. Dana Dow (R-Lincoln), sponsor of LD 831. “We can’t afford to have one of the highest minimum wages in the country, the highest tax rate, high energy rates and still expect to attract businesses and employers to Maine.

“That’s why I’ve sponsored LD 831. This bill would ensure that our minimum wage is competitive with the rest of New England by ensuring that we have neither the highest or the lowest minimum wage in the region. By aligning our minimum wage the regional average, our rate will automatically go up any time another New England state raises their minimum wage. This will ensure that our wage keeps up with the times.

“My bill would also reinstate the tip credit, because this system works well for restaurants, servers and customers. The restaurant industry is an important part of Maine’s economy, particularly in my coastal district. I intend to do everything I can to ensure that this industry continues to thrive.”


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