For many of my neighbors places such as Melba’s and Sylvia’s Harlem Restaurant represent more than just world-famous destinations for amazing soul food. From the Civil Rights Movement of the 1960s to today, these establishments have served as meeting places, beacons of community pride and anchors for our culture. The culinary icons that operate these beloved institutions stand as living proof that someone such as Melba Wilson, who was “born, bred and buttered in Harlem” can create a successful business and thrive.
Today these restaurants find themselves facing a serious threat. The proposed elimination of the tip credit threatens to damage many of these iconic establishments and even close others. Constituents and restaurant owners in my district are very troubled by this proposal and have come to speak to me about the potential damage it will cause for them and their businesses.
Proponents of the eliminating the tip credit would have you believe that restaurant owners are wealthy fat cats seeking to take advantage of their vulnerable workforce. That is a willful mischaracterization. I have watched as small-business owners—and their tipped employees—statewide have come out to advocate for the current economic system that has propelled many of them into the middle class.
Between rising rents, complicated regulations, competition from big chains and ever increasing operating costs, many small-business owners in my district are struggling to keep their doors open. For owners of hospitality establishments in my district, the elimination of the tip credit threatens one of the few industries that have been immune to the crushing consequences caused by the rise of e-commerce.
Over the years my district has experienced the same commercial rent blight that has plagued much of our great state. Empty storefronts and large chains have become an unfortunate and ubiquitous part of life in the 30th Senate District, and eliminating the tip credit could make things worse.
The elimination of the tip credit is bad for small-business owners, their staffs who depend on the tips for a portion of their income and the patrons who spend their hard earned money at these establishments. I worry about my constituents who will be asked to stretch their household budgets even further as the price of items at their local bars and restaurants increase.
Many servers and bartenders expect to lose significant amounts of income if the tip credit is abolished. Small-business owners in my district will be forced to cut staffing levels, raise prices and change their business model to adapt to higher labor costs.
In a time when many of the small independent restaurants in my district have seen their rents double or triple, they will now be faced with the prospect of adding tens of thousands of dollars a year in operating costs. Small-business proprietors who find themselves unable to quickly adapt to this sudden and drastic increase in their overhead will be forced to close their doors.
I agree that something has to be done to address the ongoing issues of employee abuse and wage theft, but eliminating the tip credit is not the way to go about it. Through increased education, effective enforcement of existing wage laws and intelligent outreach to isolated and disenfranchised communities, we can find innovative and less harmful methods to address any issues that New York State’s tip workers might be facing.
Brian Benjamin is senator for the 30th Senate District, representing the neighborhoods of Harlem, East Harlem, the Upper West Side, Washington Heights, Hamilton Heights and Morningside Heights.