MEDIA RELEASE: Food service workers among lowest paid in North Carolina

Current federal and NC tipped minimum wage is just $2.13, with workers expected to make up more than two-thirds of their hourly pay through tips

RALEIGH (February 13, 2012) – Occupations associated with food service are among the lowest paid in North Carolina, according to a new report, offering few employment benefits such as health insurance and paid sick days.

The restaurant industry is growing in North Carolina, with food service occupations projected to have one of the highest growth rates in the state over the next decade, said a report released this morning by the North Carolina Justice Center. However, there is little potential for financial stability and upward economic mobility for workers in the food industry, in part due to North Carolina’s low subminimum wage.

The current federal and North Carolina tipped minimum wage is just $2.13. Employers can pay workers the lowest, subminimum wage as long as the $2.13 wage plus tips is equal to $7.25 – the binding state and federal minimum wage – over the course of the workweek. Over time, the report said, the gap between the subminimum wage and minimum wage has increased, with workers currently expected to make up more than two-thirds of their hourly pay through tips. High instances of wage theft and the misappropriation of tips – on top of the decreased value of the tipped minimum wage – have created a pay disparity between tipped workers and the general workforce.

There are 340,000 North Carolina workers preparing and serving food throughout the state, with an average hourly wage of $9.66, translating to only $20,100 each year, the report said. The largest group of tipped workers – waiters and waitresses – falls on the bottom end of the pay spectrum, with an average hourly wage of $9.23. Currently, 27 percent of all tipped workers and 33 percent of waiters and waitresses live at or below the federal poverty level.

In addition to low wages, restaurant workers rarely receive employment benefits or paid sick days. In North Carolina, four out of five workers in food-service occupations lack access to paid sick days, the report said.

Concrete policy solutions do exist that would address the undervaluing of restaurant work, said Sabine Schoenbach, a policy analyst with the NC Justice Center and author of the report, including raising the subminimum wage for tipped workers to at least 70 percent of the minimum wage and allowing workers to earn paid sick days.

“The men and women who work hard to cook and serve our food deserve to be able to feed their own families,” Schoenbach said. “Ensuring that workers are paid for all of their hours worked and have access to basic wage laws are policies that reinforce the value of work, help struggling families, and accelerate the economic recovery.”

FOR MORE INFORMATION CONTACT: Sabine Schoenbach, Policy Analyst, Workers Rights Project at the NC Justice Center, sabine@ncjustice.org, 919.856.2234; Jeff Shaw, Director of Communications, jeff@ncjustice.org, 503.551.3615 (cell).