Will the potential passage of state ballot Question 5, which changes the minimum wage for tipped workers, result in higher incomes? Many restaurant workers in Needham are convinced it will have the opposite effect.
“Tips are based on performance, and it gives us the incentive to work hard,” said Courtney DeFrancesco, a server who has been at Cappella since it opened in 2018 and who has been in the business for 15 years. DeFrancesco said supporters of Question 5 have come to the wrong conclusions. “They think that we will get more but it would actually be a loss for us.”
The passage of Question 5 would eliminate the sub-minimum wage for tipped workers. Over five years, the minimum wage for all restaurant workers would be raised from $6.75 an hour to $15.50 an hour.
Estefania Galvis, who works for One Fair Wage and chairs the effort to pass Question 5, said the Massachusetts ballot question is an important part of their national strategy to eliminate sub-minimum wage. “It’s important to pass it here so it will have an impact in other states,” she said.
One Fair Wage claims 300,000 members, including 1,000 restaurant owners. Galvis said there are restaurant workers and owners in Needham who support the initiative, but she was unable to identify them.
On the other hand, the vote no campaign is very visible in town. Signs urging a no vote on Question 5 are posted in front of Cappella, Cook and Sweet Basil. Cappella chef and owner Rob Picardi said the owners of The James and Blue on Highland also support the effort to defeat the referendum. Picardi said the vote no campaign has been organized by Mass Restaurants United, a lobbying group for independently owned restaurants across the state.
Picardi said Question 5 would have a disastrous impact on the restaurant industry. “Consumers think that they won’t have to tip anymore and that prices will not go up. That’s a complete fallacy. Restaurant prices will go up 40%,” he said.
“Most restaurants are doing more revenue but the profits are so much smaller now,” Picardi added.
If tips do not bring a worker’s salary up to the state’s minimum of $15.50 an hour, owners are required to make up the difference. Galvis believes the law is not being enforced. “There’s no way of doing a proper audit and knowing whether the law is being complied with or not,” she said.
Picardi said, “We know how much people are making through tips. It’s reported through the payroll software.” He estimated that only 5% of customers tip with cash and that those amounts are also reported.
“We staff in a way where we know that waiters will be able to make a good wage,” Picardi said.
Diana Gutierrez, owner of Cook on Chapel Street, estimated that her servers and bartenders make $30-$50 an hour. “They make good money. It’s great money, actually,” she said.
Gutierrez said on rare occasions, she has had to contribute more to the salaries of bussers who make a separate sub-minimum wage of $7.25 an hour plus a share of servers’ tips.
Gutierrez said Maine passed a similar law by ballot initiative in 2016. “There was a big backlash there, and it would have a negative impact here from the front of the house to the back of the house,” she said.
According to Maine Public Radio, the state’s one-year experiment with higher minimum wages for servers was repealed by the Legislature a year after voters passed it. An overwhelming majority of restaurant owners and servers backed the repeal.
In the District of Columbia, where the minimum wage is $17, the minimum wage for restaurant workers was raised from $8 to $10 in 2024. Job losses and restaurant closings have been reported.
Galvis said blaming higher worker wages for contractions in the industry is not supported by the data. Rising food costs and post-COVID shifts in consumer behavior must be considered as well, she said.
The Political Economy Research Institute at the University of Massachusetts Amherst finds that in the seven states with no sub-minimum wage, salaries are higher. It says passage of Question 5 “is unlikely to reduce employment or produce large price increases.”
But Anderson Garcia, a bartender at Cook, also believes passage of Question 5 will result in lower wages for tipped workers. “Most people tip 20%,” he said. “We give good service so people want to give that 20%.” He said with a raised minimum wage, patrons will no longer do that.
“A lot of people would leave the industry,” Garcia said.
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