Senate Bill 230 was passed on June 18th by the Senate.  It raises tipped employees wages incrementally over the next 4 years until it reaches 50% of the applicable minimum wage.

Most of you may not know but in Delaware, your tipped employee is living solely off your tips.  Often their pay checks say “Not a Check” for their balance is zero and their hourly earned income does not cover the minimum taxes deducted for their declared tips and hourly income….

It works like this…  Imagine you are a tipped employee; you are currently paid $2.23 dollars an hour.  Assume you work 5 hours and make  $40 dollars in tips.  Your overall average amounts to $ 8.00 dollars an hour, plus your $2.23 dollars in wages….  You are taxed on amount of the combined $10.23, which at a class “zero”  withholding rate is roughly around 30%, putting your tax amount at roughly $3.06 dollars of hourly taxes (includes all taxes)……. Whereas the check coming to you is only worth $2.23 dollars per hour, you are thereby placed at in the negative by at least – 0.83 cents in the hole…. By working for your employer you are losing some of the money tipped to you, because state law allows you to be paid too little to even cover the full amount of your taxes…..

You say: “Oh, no, that cannot be true? There are clauses that raise the minimum wage. We here about them every year….” But… the tipped wage credit for Delaware has not changed since 1987.

Charlie Copeland….Are you still making what you did in 1987? That is what you are asking these tipped employees to do…

The obvious argument against raising this minimal expense is that it will put restaurants out of business. Of course anyone can find someone greedy enough to leave his establishment for an afternoon and drive down to legislative hall and hobnob with legislators during cocktail hour and give the darkest picture he can, as to how he will have to fold his doors if he pays one more penny to a slovenly server….

So let’s look at how much it will truly cost them. If you take Joe’s Crab Shack on the Waterfront as an example, with sales ranging between 60 and 80 thousand per week over the summer, and when fully employed, employing around 30 persons out front as servers, on the average it uses close to 700 hours per week. (The average is 3 shifts per person)

The first year raises the rate $0.28 cents per hour… Per week at 700 hours, the hit to Joe’s Crab Shack will be an estimated….$196 dollars. Less than $200 dollars for one of the top 10 grossing restaurants in the state. That is less than one case of steaks or 3 cases of chicken breasts. So on the bottom line, the hit will be…..$196 dollars on $80,000…which turns out to be a loss of a whopping 0.245th’s of one percent. (To cover this “door-closing increase” the operator would have to raise its prices one penny,…. even then he would profit from 80% of every penny raised….) So in order to protect the slimmest of profit margins….. the same excuse used by Southern Plantation owners to justify the practice of slavery, the man who wants to become your next Lt. Governor, voted to keep tipped employees at levels considered the barest of minimums as far back as 1987…..

So what does this mean in today’s economy? Most servers have felt the cutback as many people who still dine out, have felt the necessity of dropping 4% or 5%, when the minimum acceptable level for good service still stands at 20%.

Of course that can change after the stock market crashes in October…and we all become employees of our Chinese owners, who flush with our cash, snap up all types of American companies at rock bottom prices…..

So is this tip credit of $2.23 like slavery? It’s uncomfortably close. And that is why Karen Peterson should be commended for bringing up this bill as we approach these uncertain economic times. The majority of the Senate should also be commended for passing it without further ado. On the other hand, those “other” Senators besides Charlie, who think tipped servers are corporate property, are included in the following: Amick, Bonini, Bunting, Clouther, Simpson, Stills, and Venebles. If these are your Senators, give them the shock of their life, and call asking them why they still support acts bordering upon corporate slavery…… $2.23 an hour since 1987? C’mon now.

Then, you have a responsibility too: to make sure that if your server gives you adequate service when you dine out…you tip them 20%. Yes it may hurt if you are naturally cheap…., but ask them….what is it like to work for free, or even worse, to have to pay their employer a surcharge or a tip share based on their sales when they get stiffed and earn nothing………just to work costs money out of their own pocket?….. Not to mention the gas it took to get there.

This bill is now in the House Labor Committee Its chairman, Terry Spence, a Republican in a heavily Democratic district, will need to move this onto the floor for an up or down vote this Monday,……if he hopes to have a whisper of a chance in this upcoming anti Republican election cycle……

So with a little dash of hyperbole…….slavery is not dead…. And Delaware’s Republican candidate for Lt. Governor…….avidly supports it…….