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New York to Raise Minimum Wage for Tipped Workers

The minimum wage for tipped workers will go up by $2.50 at the end of the year, and could go up even more in New York City.

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New York's ongoing heated tipping debate took a giant step forward today when acting Labor Commissioner Mario Musolino signed off on raising the state's minimum wage for tipped workers from $5 to $7.50 an hour. Today Governor Cuomo announced that the raise will go into effect December 31, after Musolino accepted most of the recommendations put forth by the New York State wage board back in January (full document below). "It increases wages for those who have been without a raise for far too long," Musolino writes in his ruling. The commissioner is also open to an additional $1 an hour raise for tipped workers in New York City (bringing the minimum up to $8.50), which the state legislature is currently considering.

The large raise has a number of restaurateurs worried about how they will cover the costs. Tom Colicchio told Crain's he will likely raise prices, while Jimmy Haber of BLT is considering jumping on Amanda Cohen's bandwagon and charging diners a service charge. Still others fear that they will have to let staff go to meet the demands or shutter.

Musolino rejected the state Wage Board's proposal that restaurants where tipped workers make 150% of the full minimum wage could claim an additional $1 tip credit (which would allow them to pay tipped workers a dollar less per hour), saying that the measure isn't in the spirit of his other rulings. Musolino is also open to the board's recommendation to study whether the system of "cash wages and tip credits" should be tossed out all together, in favor of a single minimum wage for all workers, as is the case in states like California.

Check out Musolino's full report below:

Wage Board Order