Unlike Trump, Harris also endorsed raising the minimum wage — something Local 226 workers and leaders think is just as key to getting more money into the pockets of workers. The Culinary Union sees raising the subminimum wage and reducing the tax burden for tipped workers as the same fight, Secretary-Treasurer Ted Pappageorge told More Perfect Union.
“If there's any discussion about tips that should be treated differently than wages, then you got to deal with the subminimum wage,” Pappageorge said. “The idea that folks can work for $2.13/hour is just ridiculous.”
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The fight over taxes and tips goes back to 1982, when a tax increase ushered through by President Ronald Reagan (to counter the negative impacts of his 1981 tax cut) included a crackdown on tipped workers. Many employers in the Las Vegas gaming industry enter into agreements with the Internal Revenue Service to determine an estimate of how much their employees earn in tips, and employees who participate in the program are shielded from audits.
But after the Internal Revenue Service lowered the rate substantially in 2020 and 2021 to account for the impact of the pandemic, those rates skyrocketed in 2022, workers said.
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The National Restaurant Association, an industry group, has lobbied extensively against raising both the minimum wage and the tipped minimum wage, funded in part by money taken from service workers for a ServSafe certification. The group has long argued that raising the minimum wage will place “undue harm” on businesses and hurt the workers who would see a pay bump.
The Culinary Workers, for their part, don’t buy it.
"Nevada has been doing this for a while now, and it has not hurt any of the business," Seevers, the Bellagio bartender, told More Perfect Union. "When people bring more money, they're able to spend more money...it helps the economy.”
"When you heard the Vice President say, in the same sentence, 'We're going to raise the minimum wage,' that means including tipped workers," Pappageorge said. "And we're going to stand up for no taxes on tips.”
“Our members think that, for the first time, we’re getting some real attention as to the issue of fairness.”