21 States (and Dozens of Cities) Affected by 2017 Minimum Wage Increases: What Restaurants Can Do Now

Who is Impacted?

There is no doubt that the two industries with the most at risk over the impending minimum wage increases are retail and hospitality.  Especially, in hospitality, the increases are set to affect over 14 million Americans in the hospitality/ food & beverage industries - that's nearly 10 percent of the entire United States workforce.  Of course, the attempt to close the wage gap amongst restaurant employees is very important.  However, with these changes coming, restaurant owners and operators must prepare their staff.  Below are the 21 states, along with their cities/ counties where the new minimum wage increases are taking place:

States Affected:

  • Alaska - $9.80

  • Arizona - $10.00

  • Arkansas - $8.50

  • California - $10.00 for small employers; 10.50 for large employers

  • Colorado - $9.30

  • Connecticut - $10.10

  • Florida - $8.10

  • New York - Varies across state from $9.70 to $11 (as of 12/31/16)*

  • Ohio - $8.15

  • Oregon - $10.25 (as of July)

  • South Dakota - $8.65

  • Vermont - $10.00

  • Washington - $11.00

  • *The basic minimum wage is $9.70 in most of the state. But it's higher for the fast food industry; Long Island; Westchester County; and large and small employers in New York City.

Cities & Counties:

  • California:

    • Cupertino - $12.00

    • El Cerrito - $12.25

    • Los Altos - $12.00

    • Mountain View - $13.00

    • Oakland - $12.86

    • Palo Alto - $12.00

    • Richmond - $12.30

    • Sacramento - $10.50 (large employers)

    • San Diego - $11.50

    • San Mateo - $12.00

    •  San Jose - $10.50
    • Santa Clara - $11.10

    • Sunnyvale - $13.00

  • Hawaii - $9.25
  • Maine - $9.00

  • Maryland - $9.25 (as of July)

  • Massachusetts - $11.00

  • Michigan - $8.90
  • Missouri - $7.70

  • Montana - $8.15

  • New Jersey - $8.44

  • District of Columbia:

    • Washington, D.C. - $12.50 (as of July)
  • Iowa:

    • Johnson County - $10.10

    • Linn Country - $8.25

    • Wapello County - $8.20

  • Maine:

    • Portland - $10.68

  • New Mexico:

    • Albuquerque - $8.80

    • Bernalillo - $8.70

    • Las Cruces - $9.20

  • New York:

    • New York City - $11.00 (as of 12/31/16)

    • Long Island and Westchester, NY - $10.00 (as of 12/31/16)

  • Washington:

    • Seattle - $15.00

    • SeaTac - $15.35

    • Tacoma - $11.15

What Restaurants Can Do NOW …

Begin to Strategically Schedule Staff:  Get your schedules down to a science by analyzing your most crucial shifts and recognizing the strongest members of your staff.  If you’re short on time, the TeamLive tool on Harri is a great help to managers and operators, who need to align their schedules with real-time sales, better streamline their labor costs and control their overall staffing budget.

Take Your Restaurant/ Store Hours Into Consideration:  Making this work means, keeping track of your stores’ sales patterns   For example, if Monday - Friday @ 11:30 AM - 2:00 PM are very busy lunch-pops for you, yet there is a sharp dip between the hours of 5:00 PM - 10:00 PM, you may want to consider closing earlier during the week and drive all of your marketing efforts towards weekday lunch.  Your POS weekly and monthly reports should be a great indicator of these trends. If you have never done this before, contact your POS company rep for help.  

Think About Raising Menu Item Prices:  This is the last resort, so, be sure that every change made is absolutely necessary.  Go into this knowing that you may lose some guests at the expense of your menu changes. With the help of your culinary team analyze each menu item and break it down by cost.

Compare vendors on the pricing of specific ingredients (ie. if carrots cost more at Baldor than AFI than switching vendors could be effective in this case).  Do your best to communicate to your guests that your business has slightly increased menu prices to stay open, pay your employees fair wages, and most significantly to continue to have the great privilege of serving them.  

Could Restaurant Tipping be Stamped Out in New York City?


  New York has already raised the minimum wage for 2015. There is now a proposed plan to increase the hourly tipped wage to $7.50 per hour beginning in December 2015, double the current hourly pay rate of servers. Tipped wages have been "too low" for New York workers said Governor Cuomo while backing this initiative during a interview in January.

Labor advocates have argued that the current tipping wage keeps groups who dominate in tipped industries, such as women and minorities, in poverty. Restaurant owners, especially in New York City, argue that higher wages may force them to make significant changes to the way they run their businesses.

While there are no guarantees this proposal will become a law, critics of the plan were able to submit objections up until February 20th. Already the New York State Restaurant Association has planned to object siting that this proposal, if passed, will lead to fewer hours for tipped workers and restrict a restaurant's ability to create jobs. The association called the recommendation " a major blow to New York restaurants". Some restaurants could shift to a no-tipping policy, if the higher wage is enacted as well.

While New York is trying to solve this issue, the debate is echoed on a national level where tipped workers earn even less than those who work in New York. New York's tipped wage is currently $5 an hour, about 43% lower than the state's minimum wage which is $8.75 per hour. The federal tipped wage is even lower, $2.13 per hour.

Restaurateurs believe that the higher tipped wage will mean they'll have to cut back on servers, potentially hurting service.

"I wouldn't be able to have as many waiters as I have here because if I'm overstaffed, the cost is so enormous that it's going to hit me financially. So by default, all of a sudden, I'm going to be understaffed, and the quality of my service is going to go down."

- lili executive chef Philippe Massoud

It is unclear if patrons or businesses will actually suffer if and when the tipped wage disappears. According to the advocacy group Restaurant Opportunities Centers United, there are 148 restaurants nationwide that pay their workers more than the regular and tipped wage plus offer benefits such as paid sick days and parental leave. That's three times as many as there were in 2012.

Some restaurants have eliminated tipping altogether. There are hordes of countries that do not have customary tipping and still manage to produce great food and good service. Only time will tell exactly how this debate will play out. What do you think? Should tipped workers make a higher hourly wage? Or should the practice of tipping be phased out completely? Let us know in the comments section below.

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