Senate kills bill to include tips in minimum wage

HELENA – The state Senate voted 29-21 today to reject a bill that would have allowed employers to include tips in any future minimum wage they pay their workers.

Senate Bill 253’s sponsor, Sen. Donald Steinbeisser, R-Sidney, said the measure would help Montana's struggling restaurant industry get back on its feet.

“The restaurant people are in trouble,” Steinbeisser told the Senate before the vote. “Is it better to have a job with a little bit less tips or to not have a job at all?”

The bill would have allowed employers to count tips toward the minimum wage but only after that wage tops $6.90 an hour. The minimum wage, which is tied to the national inflation index, is scheduled to increase to $7.25 an hour in July.

Supporters of the bill included the owners and managers of many Montana restaurants and other small businesses.

Opponents to the bill said it would penalize the poorest of the poor in Montana for doing their job well.

Sen. Ryan Zinke, R-Whitefish, said the state has many different levels of tip-income and the bill would hurt workers in rural areas. He said the restaurant industry may be in trouble, but the problem lies in unemployment benefits and worker’s compensation, not with the tipped employees.

“I don’t think this bill fixes the problem,” Zinke said.

Attorney General Steve Bullock, who worked to pass the 2006 initiative that raised the minimum wage and tied increases to inflation, held a press conference Tuesday to rally opposition to the bill. He cited the 73 percent of Montana voters who approved the measure.

“The legislation is taking the first step to gut the popular will of what three out of four Montanans have said,” Bullock said. “Their voice isn’t being heard in the halls of this building.”

Bullock said the economy is certainly suffering but it should not be fixed by taking money away from the poorest people in the state.

“We need to make sure we’re watching out for the little fellers, not just the Rockefellers,” Bullock said.

All of the Democratic senators voted against the bill. The six Republican senators to vote against it were Sens. Taylor Brown of Billings, John Brueggeman of Polson, Rick Laible of Darby, Dave Lewis of Helena, Terry Murphy of Cardwell and Ryan Zinke of Whitefish.

- by CNS correspondent Molly Priddy

Restaurants: Minimum wage should include tips

HELENA – Citing rising costs and dwindling diners, Montana restaurant owners rallied today to support a bill that would that would allow them to pay servers less than the minimum wage.

Senate Bill 253, sponsored by Sen. Donald Steinbeisser, R-Sidney, would allow employers to count an employee’s tips toward the minimum wage - if and when that wage tops $6.90 an hour.

Critics said the measure would hurt Montana’s poorest workers, but Brad Griffin, representing the Montana Restaurant Association, said continual cost-of-living increases in the minimum wage are impossible to absorb in a tough economy.

“It is no exaggeration to say that the restaurant industry in Montana is suffering,” Griffin said. “We just need a breather.”

Griffin also said waiters and waitresses are typically the highest paid staff in the restaurant and should not get required raises when they are making more per hour with tips anyway. A “tip credit” would allow restaurants to stay in business, he said.

Montana’s minimum wage is scheduled to increase from $6.90 an hour to $7.25 in July. Supporters of the bill want tips to cover the extra 35 cents an hour.

In 2006, Montanans approved an initiative that raises or drops the minimum wage every year, depending on the national inflation figuers. Soon after the initiative passed, the federal government passed a similar law. Montana’s minimum wage changes every six months.

Steinbeisser also presented Senate Bill 254, which would remove Montana’s mandatory minimum wage increase based on cost of living.

Supporters included restaurant owners and representatives of several national chains, including Outback Steakhouse, Applebee’s, Perkins, Famous Dave’s, Pizza Hut. The Bozeman and Great Falls Chambers of Commerce also supported the bill.

Opponents argued that tips are the employee’s property and restaurant owners have no right to ask customers to subsidize their employees’ wages.

Rachel Conn, a waitress and sous-chef at Benny’s Bistro in Helena, said even with tips added to her minimum wage she can barely pay her bills and have enough for her emergency savings fund.

“In these hard economic times, we will never do better if we pay less,” Conn told the Senate Business, Labor and Economic Affairs Committee. “I am a good employee. My work and the work of my fellow employees should be valued.

Opponents included unions, the Montana Human Rights Network, waitresses and baristas. The Montana Department of Labor and Industry and Gov. Brian Schweitzer also opposed the bill.

-by CNS correspondent Molly Priddy