GOP resolution would make tips exception to $18 Arizona minimum wage initiative

Published: Tuesday, March 26, 2024 - 11:55am
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GOP lawmakers at the Arizona Capitol are advancing a measure that would let businesses pay employees who work for tips less than the minimum wage. It’s a ballot referral that, if passed, would let voters decide the issue.

And it’s in direct response to a ballot initiative that’s currently collecting signatures that would raise the minimum wage for all workers to $18 an hour. 

Jerod MacDonald-Evoy is covering it for the Arizona Mirror, and he’s on The Show to tell us more.

Full interview

LAUREN GILGER: Good morning, Jared.

JEROD MACDONALD-EVOY: Good morning. Thank you for having me on.

GILGER: Thanks for coming on. OK. So Republican lawmakers seem to be heading off this ballot initiative that's out there gathering signatures already. Tell us exactly what the resolution heading through the Legislature right now would do.

MACDONALD-EVOY: Yeah. So this is a strike-everything amendment to Senate Concurrent Resolution 1040. And what it would do is it would send a question to the voters on the ballot if it passes out of both the House and the Senate asking them to allow tipped employees to be paid 25% less than the minimum wage. Currently in Arizona, under current law, businesses can pay tipped workers $3 less than the current minimum wage. So, for example, that would mean that under the current minimum wage workers would be paid $3.58 less than the current minimum wage if this were to pass. 

GILGER: OK. And this effort is backed by restaurant owners, the business kind of groups. Tell us a little bit about what they're worried about if this initiative that's gathering signatures out there now were to make it to the ballot and pass.

MACDONALD-EVOY: Yeah. So a lot of the conversation, on the debate on this bill was that if the minimum wage were raised again, that it would cause cascading kind of costs to restaurants and restaurant owners. And there were a few lobbyists for like the Arizona Restaurant Association as well as people who were tip workers themselves who argued that, you know, every time they've seen the minimum wage increase that they've seen those costs passed down to the customer on menu prices or in cuts to employees.

GILGER: So, this ballot initiative that we've been talking about that's gathering signatures, it would raise the minimum wage to $18 an hour. Would it have any exceptions for tipped workers?

MACDONALD-EVOY: So the ballot initiative that is going through the process of getting signatures would raise the minimum wage to $18. It wouldn't change anything with how the tip workers could get tips, they would still be allowed to get tips under this but it would make it so they would be promised $18 an hour at a minimum, as opposed to the current law, which allows for the $3 less.

GILGER: There was, as you said, a lot of testimony when this was debated in the Legislature, tell us a little bit about the arguments from the other side. Like if restaurant owners, business groups are, you know, worried and they want to be able to pay tipped workers less. What did workers have to say?

MACDONALD-EVOY: Well, some workers, specifically some workers from the airport who work in the restaurants there, said that they survive off their tips as, you know, because the fact that they get paid below minimum wage, of $3 below minimum wage, their paycheck ends up going to health-care costs, you know, to pay for the health care that their employer will be paying for or to go towards tax, state and federal, local taxes. And so then they end up surviving mainly off tips and so making it so restaurants can pay, you know, ostensibly less than the minimum wage would make it, you know, even harder for them to continue to make a living at their job.

GILGER: And those workers have already been striking over things like wages, right? The workers at Sky Harbor.

MACDONALD-EVOY: Correct. The Sky Harbor Airport food workers have been striking over their wages, pensions and benefits because most of the workers there make less than $25 an hour, which according to, to groups like the National Low Income Housing Coalition, you need to be making at least $33.46 an hour to afford a two-bedroom apartment. And some of the workers shared stories that, you know, they have, you know, fellow coworkers who are sleeping in their cars at the airport parking lot because they can't afford a place to live. 

GILGER: Several lawmakers also spoke out about their own experiences in the restaurant industry, sort of on both sides. What did they have to say?

MACDONALD-EVOY: Well, on the Republican side, you had lawmakers like the bill sponsor Justin Wilmeth who said that, you know, he had worked as a server, he had great appreciation for the industry. It was how he kind of got started in the workforce. And he said, you know, you put in what you get in when it comes to that career. And then you had people like Rep. Lorena Austin, a Democrat from Mesa who said that prior to her time becoming a lawmaker, she worked two server jobs at the time and it was always very difficult to make ends meet and she never had things like health care due to the fact that, you know, these jobs paid very low wages and she, she was consistently struggling with that.

GILGER: So tell us before we let you go here, Jerod, what is next with both of these? We've got the initiative trying to gather signatures to get on the ballot. And then Republican lawmakers may be putting this on the ballot as well. Where do both of these stand? How far are they away from making it to that ballot?

MACDONALD-EVOY: From what I can gather the, the ballot initiative to raise the minimum wage, looks like it will probably be on its way to get on to the Arizona ballot. The people behind it have been paying for a lot of paid circulators to be out there to gather signatures. They have gathered quite a few signatures and are very close to reaching the number that they need. In regards to the resolution by the Republicans at the Legislature, it will still need to get a final approval in the House and then it will go to the Senate for a final vote before it can go on to the November ballot. So it needs to get through both changes successfully in order to get onto the ballot.

GILGER: OK. So a lot to watch for there and potentially adding to the very long list, it sounds like of things that we will have to vote on this ballot in November. OK. That is Jerod MacDonald-Evoy covering this for the Arizona Mirror joining us. Jared, thanks as always, appreciate you coming on.


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