Eye On Illinois: Can state address tipped wage concerns without a new law?

As Illinois lawmakers continue discussions about abolishing the legal subminimum wage, it’s worth looking beyond an often binary debate.

The issue has been on Springfield’s radar throughout the spring session after the Chicago City Council in October enacted its One Fair Wage Ordinance. Under that plan, the base wage for tipped workers will increase 8% yearly until it reaches the city’s regular minimum of $15.80 per hour. The city’s minimum wage increases annually by the smaller of either 2.5% or the rate of the consumer price index, so it should take about five years to eliminate the difference.

Typical arguments have one side arguing service-industry workers should have access to the same minimum wage as non-tipped employees, while the other side says a change would cripple businesses, send consumer prices skyrocketing and reduce employment opportunities.

These talking points carried the day at the Statehouse Wednesday, according to a Capitol News Illinois report, as House Bill 5345 advanced out of committee. In a nod to significant pushback and support, bill sponsor state Rep. Lisa Hernandez, D-Cicero, said she wouldn’t bring it to the full chamber without further amendments.

The current statewide minimum is $14 for adults and $8.40 for tipped workers, those numbers will move to $15 and $9 on Jan 1. Even if we can’t agree if either figure is sufficient, perhaps there’s common ground on another point: Under the status quo, employers are required to make up the difference when tips fall short. So rather than change the law, why not enforce the one already on the books?

As CNI noted, HB 5345 backers say employers don’t always cover the gap. Rep. Curtis Tarver, D-Chicago, joined bill opponents at a Statehouse news conference to suggest the plan “is more legislation chasing a solution to a problem that does not exist” and that targeting bad actors would be a less disruptive use of state power.

(Side note: The state Department of Labor has resources for workers looking to file payment claims, consolidated at labor.illinois.gov/unpaidwages. There’s a minimum wage hotline at 800-478-3998, a subminimum wage info line at 312-793-2804 and the email address for all minimum wage and overtime questions is dol.mwot@illinois.gov).

Tarver’s position seems reasonable, especially if it doesn’t require strengthening DOL’s authority. Tipped workers are among those opposing the plan because while the proposal as written doesn’t outlaw tipping, those comfortable with their current earnings feel they’d make less on balance if their customers are priced out of the market.

Consumer habits are entrenched, so if there’s a way to address wage gaps while minimizing unintended consequences, that might be the smoothest path to significantly improving conditions for working people. If nothing else, simply expanding the debate is worthwhile.

• Scott T. Holland writes about state government issues for Shaw Media. Follow him on X @sth749. He can be reached at sholland@shawmedia.com.