One Fair Wage ballot proposal eliminates Tip credit

“Simply put, this proposal is irresponsible and dangerous and it will fail in Michigan like it has failed everywhere else,” said Justin Winslow, President & CEO of the Michigan Restaurant Association.
“In Maine, restaurant workers organized and successfully overturned a nearly identical ballot proposal in 2017 because they know the tip credit works for everyone involved.  In Washington, D.C. and New York, elected officials and prominent news media are siding with servers against a similarly cynical play by organized labor because they know it will mean fewer jobs, fewer opportunities and lower incomes for those impacted,” he added.
“The restaurant industry is proud of its unassailable reputation as an industry of first opportunities and second chances and the Michigan Restaurant Association will continue to fight to ensure those opportunities remain for those that need them most.”
Key Facts:

  1. The restaurant industry is proud of its unassailable reputation as an industry of opportunity.
  • Over 30 percent of Americans started their career in the restaurant industry.  It is the training ground for millions of entry level workers who have built critical skills of personal responsibility, teamwork and accountability.
  1. The tip credit business model is the standard across the United States and is preferred by servers. 
  • Currently, 43 states operate with a tip credit business model, including every state that borders Michigan.
  • Every tipped employee in Michigan makes at least the full minimum wage. If an employee ever receives less than the full minimum wage including tips, the employer is required by law to ensure every employee makes Michigan’s minimum wage of $9.25/hr.
  • A 2017 statewide poll of Michigan Restaurant Association full-service restaurants showed that servers averaged $17 per hour, with some making significantly more.
  • An industry point-of-sale company called Upserve conducted a survey in 2018 that found 97 percent of servers ranked tipping as their preferred payment method.
  1. Eliminating the tip-credit is unifying restaurant workers AGAINST attempts to eliminate the tip credit. 


  1. Eliminating the tip credit will result in significant job loss and irrevocably damage Michigan’s restaurant industry.
  • An economic impact study conducted by the Economic Policies Institute demonstrated that Michigan will lose over 14,000 restaurant server jobs if the One Fair Wage proposal is enacted.
  • The One Fair Wage proposal would increase labor costs of restaurant owners by more than 240 percent, forcing them to increase prices, layoff staff and possibly even shutter their doors.


  1. Wage pressures will force automation and drive down job opportunity while increasing costs.
  • In Michigan, there is a 94 percent “Automation Probability” for traditional restaurant employees due to the increase in labor costs according to the Bureau of Labor Statistics.

About the Michigan Restaurant Association
The Michigan Restaurant Association (MRA) is the recognized leader of Michigan’s hospitality industry, providing essential services to the foodservice community.  Founded in 1921, the MRA represents nearly 4,500 Michigan foodservice establishments. The industry plays an integral role in Michigan’s economy, employing more than 440,000 people and creating nearly $16 billion in annual sales.


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