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LA's Proposed $15 Minimum Wage Has Restaurant Owners Very Afraid

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What tipping means to the bottom line.

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Los Angeles’ ongoing minimum wage war between small and medium-sized business owners and City Hall continues to heat up. In the past, plenty of L.A. area restaurants have taken to various measures to make sure that both their waitstaff and back of house teams are paid a living wage (not that it’s stopping the tip jar bandits), but now the city council’s proposed $15 minimum wage has them all feeling the squeeze.

A consortium of restaurant owners, including some of the biggest names in the business, have been publicly speaking out about the proposed increases; not as anti-living-wage misers but business owners looking to create a balanced alternative for tipped and non-tipped employees.

"There is just no room for us to be able to afford this increase and stay in business," Caroline Styne told the LA Times. She is one of a number of restaurant owners who contend that counting tips in a minimum wage discussion for front of house staff is not only fair for all parties (including the lower-paid back of house workers), it’s the only way to stay profitable and actually keep people at work. Labor organizers say that the minimum wage differences would violate longstanding California law and leave workers vulnerable.

Mayor Garcetti himself has backed state legislation to count tipped restaurant employees only when considering the adjusted minimum wage; all other industries would be unaffected. It’s a position that works for George Abou-Daoud, the Hollywood restaurateur who contends that, in all reasonable ways, tips are already considered a wage. They’re even taxed as such.

For now, the minimum wage issue is ongoing and very much in flux. But soon enough, Los Angeles will have to contend with a higher minimum wage, tipped or not, which inevitably means a higher menu cost for diners citywide.

Eater Video: The argument against tipping, explained

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