Restaurant Owner's Take: Voting No to Increasing Minimum Wage for Waitstaff

Editor's Note: This is an opinion piece from a restaurant owner in Massachusetts facing a rising minimum wage law for waitstaff this election cycle. The beliefs are the author's own. We welcome additional commentary articles on this or any other relevant restaurant operations topic -- write in to jaime@runningrestaurants.com with your article or feedback.

From one small restaurant Owner’s perspective. This is why I am voting No on Question 5:

Question 5 will ask you to increase the server minimum wage of $6.75/hr. to reflect the state minimum wage of $15/hr.

While it may sound like the right thing to do, there will be significant negative impacts on the future of the restaurant industry. This will include noticeable price increases, a reduction of staff/job loss (think technology and self-serve ordering) and a decline in overall service.

Noticeable Price Increases – The proposed increase will raise THIS restaurant’s annual payroll costs by over $85,000 per year. We are a single unit, non-chain, neighborhood restaurant. We simply cannot absorb this cost. We will HAVE to increase our prices to cover this additional annual expense. Going from $6.75/hr. to $15.00/hr. is a 122% increase! Customers can certainly expect to see significant menu price increases over the next five years, after an already difficult inflationary period.

Reduction of Staff - Another way to offset these payroll increases would be to invest in self-service technologies such as kiosks, tablets or self-checkout QR code point of sales. The technology is readily available and not a significant capital expense. If you have been to any major airport lately, you will notice most bars and restaurants are moving to this format. This will actually ELIMINATE jobs!

Decline in Service – With the reduction of staff, comes a decline in service. Whether with automation or a reduced number of servers on the floor, it will be difficult for guests to receive the same current level of service. Overwhelmed servers and longer table turnovers will undoubtedly reduce overall restaurant revenue. A reduction in restaurant revenue will bring down the tip amounts. Add in increased menu prices and it is likely diners will opt to eat at home more often. THIS is what servers are concerned about. And if all these become reality, our best servers will leave the industry as many did during Covid.

While the above minimum wage amounts seem out of proportion, note that ALL servers are currently paid a minimum wage of $15/hr. If their tips do not meet that minimum. Restaurants are required to make up the difference if they do not meet the minimum $15/hr. In other words, they already make a minimum wage of $15/hr. under the current system!

While tipping culture may have gone overboard over the last few years, in full-service restaurants it is an important part of the hospitality business. Without tipping, service will continue to decline and become self-service. Think about your favorite restaurant or pub, where you know some of the staff and enjoy going in to say hello because you receive great service. These places may no longer exists as we move towards an automated self-service world. Several “Yes” voters have said “they don’t feel like they should be the ones supplementing servers’ wages”. Unfortunately, someone will have to pay for these increases and smart business owners will be passing them along one way or another.

Most servers believe this will harm their overall income and will vote NO on Question 5. The group representing “Yes” is an outside lobby group. Think about that. The majority of the people it is intended to help will vote against it! This is why I’m voting NO on Question 5.

Craig DeOrio is the owner of Fibber McGee's Bar and Grill in Beverly Mass.