Chicago May Eliminate the Tipped Minimum Wage in October

Chicago remains on pace to pass an ordinance next month to rid the city of its tipped minimum wage. A procedural committee vote last week at City Hall went through without real opposition.

This sets the stage for a vote at this week’s council meeting. If approved, a final vote would come at the Wednesday, October 4 meeting. This timeline was shared last month by One Fair Wage founder Saru Jayaraman when she appeared via Zoom at an Evanston city council meeting where suburban leaders discussed their own ordinance.

The Chicago measure has drawn 26 co-sponsors which is enough to get it through. What was surprising is that 26th Ward Ald. Jessie Fuentes says that negotiations haven’t taken place between supporters of the measure and the Illinois Restaurant Association.

Fuentes, representing Mayor Brandon Johnson and other progressives, spoke last week during a news conference held by One Fair Wage at City Hall and mentioned association President Sam Toia by name.

“We have not been closed to negotiations or further conversations with folks like Sam Toia and the Illinois Restaurant Association,” Fuentes said. “He knows how to get a hold of us and we will reach out.”

When reached by text on Monday, Toia wrote “We’re happy to talk and welcome those conversations. From day 1, our focus has always been about ensuring Chicago restaurants have the resources they need to be successful and restaurant workers are paid the fair wages and tips they have earned.”

At the aforementioned Evanston meeting, One Fair Wage reps revealed how they’ve typically gone about business in abolishing the tipped minimum wage, working with elected officials in seven states in passing legislation. The activists have created an outreach organization, High Road Restaurants, that often works with restaurants and may negotiate concessions.

Last week, activists also released a list of Chicago restaurants that supported the ordinance. A few listed restaurants were closed bringing the number of active supporters close to 60. Notable names include Rick Bayless’ Bar Sotano, Jason Hammel’s Lula Cafe, Cliff Rome’s Peach’s on 47th, Zoe Schor’s Split-Rail, and soul food icon Josephine’s Southern Cooking from Josephine “Mother” Wade. None of these restaurants are publicly traded restaurants, say like an Applebee’s. The point is that the finances of an independent restaurant are different from a chain that has deeper pockets. Elected officials would be wise not to lump all restaurants into one group like President Trump did in 2020 during an infamous pandemic economic roundtable that only included celebrity chefs and chains.

Whether or not the restaurant association is privately negotiating with Fuentes and the other members of the council backing the ordinance, the IRA is going public with ideas. Knowing the measure has enough votes by sheer virtue of its 26 co-sponsors, Toia floated a “longshot” idea week to the Sun-Times which implores the city to go after restaurants — bad actors — who break the law and pocket the “tip credit” that is supposed to be paid to workers. The tip credit makes up the difference between the $9.48 tipped minimum wage and the Chicago standard $15.80.

The association publicly opposes the ordinance, claiming restaurants may close or raise prices to compensate for higher salaries. The association says workers in Chicago don’t need the ordinance and “that the median full-service restaurant tipped worker makes $28.48 per hour in Illinois.” A few restaurant workers at upscale downtown restaurants may make six figures, but that’s not the norm as BIPOC women typically make less. One Fair Wage’s data shows women in waitstaff jobs in Chicago make a median income of about $21,000.

There’s also a preference by some restaurant owners to wait and have the state take action so all of Illinois would abide by the same rules. One Fair Wage characterizes that as restaurant owners dragging their feet and only postponing the inevitable.

Another supporter of the ordinance, 17th Ward Ald. David Moore spoke at the same news conference that Fuentes spoke. He shared his experiences as a student at Simeon High School working for $3.35 per hour at Ronny’s Steakhouse, a defunct chain of downtown restaurants known for affordable meals. Moore says his bosses took 25 cents out of workers’ checks for lunch regardless if they ate a meal at the restaurant or not. Moore remembers a Latinx colleague who didn’t speak English. They couldn’t communicate, but they both shared the understanding that they weren’t making much money. But there was a distinction.

“He was grown, I was in high school,” Moore says. “He had a family — there was no way you can survive on what they are paying people.”