After minimum wage hike, many New York restaurants cut workers' hours

NEW YORK (FOX 5 NY) - Oxbow Tavern opened on the Upper West Side of Manhattan just a year ago. But already owner Greg Hunt has had to raise prices and cut back on staff. Hunt is among the restaurateurs in the city who say the state's minimum wage increase is hurting their bottom lines.

On December 31, 2018, the wage for tipped workers in food service rose from $8.65 to $10 an hour plus a $5 tip credit guaranteeing servers a total of at least $15 an hour.

NYC Hospitality Alliance executive director Andrew Rigie said his group did not oppose the new minimum wage but wants the public to know that is affecting the industry. The alliance surveyed about 600 restaurant owners and found that 75% said they would cut employee hours in 2019 because of increased labor costs related to increased wage mandates.

But restaurant worker advocacy groups question those figures and say the benefits of the increased minimum wage outweigh the drawbacks. Theofilo Reyes of the Restaurant Opportunities Center United said that higher wages allow low-wage workers to have and use more disposable income. And they like to spend that income in restaurants, he added.

Restaurant Opportunities Center favors the so-called one fair wage. It would eliminate the tipped minimum wage and raise the servers' base rate. Seven states have already done that.

In 2018, the state Department of Labor held a series of hearings on whether or not to eliminate the tipped wage but so far the department has yet to issue a decision.