HorsesAss.Org

Omigod I wish this OneSeattle website wasn’t a parody. But many a truth is said in jest:

From the employer’s perspective, compensation is about a whole lot more than wages. Just consider a typical cost breakdown for an average low-skilled minimum wage employee:

• Base wage: $9.32/hour
• Sick leave: up to $0.50/hour
• Vacation: approximately $1.50/hour
• Payroll taxes: $1.60/hour
• Breaks: $0.50/hour (approximately, depends on shift length)
• Training: $1.00/hour (prorated based on turnover)
• Employee food discount: $0.50/hour (depending on girth)
• Cost of nonwork time: $0.25/hour (i.e. texting while on the clock)
• TOTAL: $15.17

Funny stuff. And disturbingly believable. The whole website reads like the unfiltered id of the restaurant industry.

UPDATE: Shit. Now I’m getting 404 Errors. Have the humorless pricks in the restaurant industry already had the site taken down? That would be fast. I guess there’s always the Google cache.

UPDATE, UPDATE: Back up over here!

Hey Uber drivers… welcome to the wonderful world of unregulated for-hire, where the TNCs can just cut you off without notice, for any reason and any time, and you have absolutely no legal recourse:

“My rating went to a 4.6 (out of a five-star rating) and they suspended me. They just turned my phone off. They didn’t give me a warning; they didn’t give me a week’s notice. I just woke up in the morning to go to work and my phone was off. And they’ve done that to a lot of people,” said former Uber driver, Will Anderson. “That’s huge—if you make an investment in a vehicle and you have a family you need to feed.”

Hooray for the free market and the efficiencies it imposes! No doubt Uber knows what it is doing, so we should just trust them.

A panel of TNC and town car drivers will be holding a public forum to air concerns about Uber’s “predatory practices” on Sunday, April 13, 2 pm, at the Yesler Community Center, 917 E Yesler Way in Seattle. Seattle City Council members Kshama Sawant and Mike O’Brien are scheduled to be there.

If you’ve ever wondered what it tastes like to lick Brad Smith’s asshole, just ask the editors at the Seattle Times:

THE state’s two biggest companies took a gamble on Washington a few years back, and at long last the state has finally paid off.

Back in 2011, Boeing and Microsoft pledged $25 million apiece for the Washington State Opportunity Scholarship program. The program, run by the College Success Foundation, defrays costs for low- and middle-income students when they major in science, technology, engineering, math and health at Washington colleges. Each student is eligible for as much as $17,000.

So Boeing and Microsoft save hundreds of millions of dollars a year in state tax breaks and tax loopholes—denying the state the funds necessary to adequately fund higher education and other crucial investments—and yet we should cheer them as civic heroes for spending a mere $25 million each (0.03 percent of their $164 billion in combined 2013 revenue) to subsidize educating their own workforce?

Hooray for capitalism!

The “gamble” Boeing and Microsoft took was that this feeble gesture would provide political cover for their roles in perpetuating the structural revenue deficit that undermines Washington’s K-12 and higher education systems as a whole. And it was a gamble that has paid off handsomely under the credulous watch of our state’s editorial boards.

I got an email from Patty Murray’s campaign yesterday about this year’s Golden Tennis Shoes. And oh hey, Elizabeth Warren is speaking this year.

Every year, I host the Golden Tennis Shoe Awards to honor ordinary citizens who have done extraordinary things to help improve their communities and the lives of those around them.

I’m thrilled to announce that my friend, Senator Elizabeth Warren, is going to join us this year to keynote the Golden Tennis Shoe Awards and help me congratulate these amazing Washingtonians.

It’s interesting to see what Warren’s role is in the party as a relatively new Senator. When someone like her is headlining a big deal fundraiser like the Golden Tennis Shoes, it probably says something about the left flank of the Senate. You can say that sort of thing doesn’t play outside of Mass, but you know, she’s taking it on the road here, because she has a popular platform.

There is this weird counterintuitive and counterfactual meme being put forth by the anti-minimum wagers that argues that a lack of a “tip credit” could ironically end up hurting the incomes of tipped employees. For example, from an anonymous server writing in The Stranger (because that’s apparently their new journalism business model—anonymous people writing for free):

Tips are an important part of my income. As someone who makes a great living on tips, I don’t want the awesome culture and great jobs created by Seattle’s restaurant boom to disappear. I do not believe customers will keep tipping at the percentages they do now if they know my base wage has gone up 60 percent. And if that’s how customers respond, the end result will be a drastically lower income for those of us who work in restaurants and bars—gender aside.

Oh. Well. She is anonymous after all. So perhaps we should just defer to her “belief” and scrap this whole foolish $15 minimum wage endeavor entirely? Best intentions and all that, but my bad.

Oh please.

First, let’s be clear that this argument is not just totally speculative; it is also somewhat illogical. As an episode of Freakonomics Radio pointed out last year, tipping isn’t exactly a rational economic exercise. It’s a matter of custom. So most Americans tip out of a combination of habit and peer pressure—15 percent if you’re a cheapskate, 20 percent if you’re not, or double the sales tax rounded up here in Seattle if you’re lazy like me. In fact, Seattle’s tipping culture is so ingrained, that it’s hard to imagine a minimum wage hike impacting most consumers behavior with or without a tip credit. Indeed, if restaurant owners carry through on their threat to raise prices, then it is at least equally reasonable to speculate that tipped income will go up, as diners simply add their customary tip percent onto the new pricier bill.

Further undermining this anti-$15 speculation is the total absence of supporting facts. I mean, it’s not like we haven’t raised the minimum wage many times before—by a whopping 85 percent for tipped employees here in Washington state between 1988 and 1989—and with no tip credit! This isn’t ancient history. And yet there is zero evidence of mass restaurant closures, job losses, or a decline in tipping in the aftermath of this precipitous wage hike. The economic data is there. If there was even the flimsiest evidence to suggest a negative economic impact from that 1987 minimum wage initiative, you can be sure that the bullshit artists at the Washington Policy Center would be flinging it.

Finally, even if a $15 minimum wage with no tip credit might influence some diners to chintz on their tips (because you begrudge the server bringing you your $40 entree a $5/hour raise, or something), consumers would have to have this information in order to act on it. But most diners are low-information consumers, as well as creatures of habit. Ms. Anonymous acknowledges our “awesome” tip culture, despite the fact that Washington is one of only seven states without a tip credit. Do most diners understand that?

I do, and yet I tip the same percentage back East in Pennsylvania and New Jersey that I do here in Seattle, because habit! Except for one big difference: Back East, I almost never drop money in the tip jar for take out coffee or food, because I know the servers won’t get it! For example, New Jersey’s tip credit is an abusive $6.12 an hour. No Starbucks barista in New Jersey is making anything close to that in tips. So every dollar you stuff in a tip credit state’s tip jar is going straight toward lowering Starbucks’ labor costs.

Of course, Seattle baristas do better. We don’t currently have a tip credit. And yet according to a survey conducted by the coffee blog Sprudge, our tipping culture here is especially strong:

I was a little surprised that Seattle made only one appearance in the top 10 list for tips with $9.28/hr, despite tips in Seattle making up the highest average percent of income of any city at 35%. In my experience, the high-end of tips in Seattle may not be great, but tipping is obviously a cultural value: Seattle was #3 for average tips at $5.85/hr.

FYI, that $5.85 an hour average is almost exactly what our tip credit would be. You might as well just dump that tip jar directly into the employer’s pockets.

And that’s why if we pass a tip credit here in Seattle, I’ll stop tipping baristas here too. Because I’m not stupid.

I guess this is the sort of navel gazing that passes for news these days around the offices of the Seattle Times editorial board:

With the retirement of state Supreme Court Justice Jim Johnson for health reasons, Gov. Jay Inslee will have the opportunity to appoint a justice to the nine-member panel. The Spokesman-Review and the Yakima Herald-Republic have joined The Seattle Times in encouraging the governor to look East of the Cascades for his choice.

Omigod, omigod! The editorial boards of two Eastern Washington newspapers have urged Governor Inslee to appoint a supreme court justice from Eastern Washington! It’s snowing in Hell! Or something!

(Yawn.)

As I’ve previously written, I don’t really care from what part of the state Justice Johnson’s replacement hails, as long as he or she is the best qualified jurist available. That should be Inslee’s primary concern. Though I’ve no problem with diversity—geographic or otherwise—being used as a tie-breaker.

That said, let’s be clear that Governor Inslee has absolutely nothing political to gain from appointing a justice from the other side of the mountains. Either way, he will not receive a single Eastern Washington daily newspaper editorial board endorsement in 2016, regardless of his Republican opponent. Nor would such an appointment earn him any additional Eastern Washington votes.

Elections have consequences. Had Republican Rob McKenna won the governor’s mansion, you can damn well believe that he would have treated Democratic constituencies like crap. So there’s no real reason to reward Eastern Washington voters with any special favors beyond the billions in tax subsidies we already ship their way.

– I’m cautiously optimistic about the Seattle Bike Master Plan

– How Portland can reduce the wage gap between women and men

Often there’s really not any more time on the “day off” for creative work than during the rest of the week. Everything else that got put off during the week rushing in to fill that gap left by the day job. [h/t]

– If you’ve had your bike stolen in Marysville, go look for it.

– Today in conservative victimhood

– Now where will I possibly be able to find deep fried seafood in Ballard? (I like Ivar’s, but I don’t think I’ve ever been to the Ballard location).

To be clear: I don’t endorse inserting a “tip credit” into Seattle’s minimum wage ordinance. It would incentivize wage theft, while setting a terrible precedent for other lawmakers following in our $15 footsteps. Furthermore, despite its deceptive efforts to use small businesses and their tipped employees as a sympathetic proxy, the restaurant industry has failed to make a compelling argument as to why a tip credit is either necessary or proper.

But unfortunately, I’m not Benevolent Dictator (yet!), so as long as the politicians are debating a tip credit, I thought it might be useful to talk about how we might make the tip credit better, by using it as a tool for combatting both forced part-time employment, and wage and tip theft—two employment abuses that afflict many low-wage workers.

The perfect is the enemy of the good, and all that. So to this end I offer five sincere suggestions on how to make a tip credit a better less worse public policy:

Require Strict Business and Accounting Practices:
Any tip credit we implement must be conditional on establishments meeting strict business and accounting standards intended to impede wage and tip theft (and other abuses), while facilitating the investigation and prosecution of claims thereof. Don’t want to be told how to run your business? That’s fine. Don’t claim a tip credit. It’s your choice. Simple as that.

But of course, all the worker protections in the world aren’t worth shit if there’s no mechanism to enforce them. So with or without a tip credit, Seattle’s minimum wage ordinance should include a stable and adequate dedicated revenue stream to fund enforcement of labor standards—plus criminal penalties for violations. Maybe then every Seattle worker will finally get the paid sick leave required by law?

Raise and Exempt the Monthly Threshold:
Currently, the federal tip credit applies to all employees who regularly earn more than $30 a month in tips—the same monthly threshold that was put in place when the tip credit was first created back in 1966. That’s ridiculous. But raising the monthly threshold is about more than fairness; it could also serve as a powerful tool for incentivizing employers to move part-time employees to full-time work.

For example, let’s say we implemented a tip credit, but set the monthly threshold to $860 a month—the equivalent to earning $5 an hour in tips over 172 hours a month of full-time work. But we’d also need to exempt from the credit the first $860 a month in tips as well, in order to avoid plunging tipped workers off some sort of punitive cliff. (Without the exemption, workers earning $859 a month in tips would keep all of them, while workers crossing that threshold would lose their first $860 in tips, regardless of whether they earned much more that month.)

This takes care of all those mythical $80,000 a year servers we keep hearing about. In fact, the $860 monthly threshold and exemption would pretty much apply to any full-time tipped worker currently earning over $29,700 a year.

But remember: this is a monthly threshold, not an hourly one. So a part-time employee only working half the hours would need to average twice the hourly tips—$10 an hour—in order for the employer to start deducting a tip credit. And since the value of the tip credit would almost always be greater than the cost of providing benefits, it would remove much of the existing incentive for pushing tipped employees to part-time non-benefit-qualifying work.

I’m not sure what the optimal monthly threshold is to achieve the maximum economic incentive, but I’m confident that such a number exists. Regardless, any tip credit without a substantially higher monthly threshold than federal law should be off the table.

Prorate the Tip Credit for Part-Time Workers:
This is a variation or addendum to the monthly threshold provision described above. A half-time employee should only qualify the employer for half the maximum hourly tip credit a full-time employee would. For example, if the maximum tip credit is $5.00 an hour, the prorated maximum tip credit on an employee working only 20 hours a week would by $2.50 an hour.

Again, the goal is to dangle the tip credit as a carrot for moving part-time workers to full-time work.

Calculate Tip Credit Per Shift, Not Per Pay Period:
If you don’t think some employers switch workers’ shifts around in order to maximize tip credit, then you don’t know fuck about capitalism. This may not be an issue at Tom Douglas’s restaurants, where every server is allegedly a millionaire or something, but the third shift at Denny’s is a different story. Earn a tip credit worth of tips early, and you may find yourself filling ketchup bottles while a less well tipped colleague is given the better tables in order to push her over the top too. Likewise, earn some big tips early in your pay period, and you may find yourself bumped from a good shift to make room for a co-worker who hasn’t yet qualified the employer to take the full tip credit that pay period.

Regardless, calculating tip credit per shift is just more honest and less prone to manipulation. This should be one of those required business practices mentioned above.

Tip Credit Phase-Out:
Of course the best tip credit provision would be one that phases itself out, giving qualifying restaurants and other tipped businesses a bit more time to transition into our new living wage economy, but without establishing a tip credit as any sort of credible precedent.

For example, let’s say we phase in a $15 minimum wage with a tip credit over three years: $11/hour in 2015, $13/hour* in 2016, and $15/hour* in 2017. (* Adjusted for inflation.) Then we phase out the tip credit over the next three years, one third at a time.

The maximum legal tip credit would be the difference between Seattle’s higher minimum wage and the effective minimum wage for tipped employees under state and federal law—currently Washington State’s $9.32 an hour minimum wage. Assuming annual inflation of 1.75 percent, and no hike in the state or federal minimum wage other than CPI, the minimum wage and the minimum labor cost for tipped employees would rise accordingly:

Year	WA min wage	Seattle Min Wage	Max Tip Credit	Min Labor Cost*
2015	$9.48	$11.00	$1.52	$9.48
2016	$9.65	$13.23	$3.58	$9.65
2017	$9.82	$15.53	$5.71	$9.82
2018	$9.99	$15.80	$3.87	$11.93
2019	$10.16	$16.08	$1.97	$14.11
2020	$10.34	$16.36	$0.00	$16.36

* Minimum Labor Cost assumes employee earns enough tips for employer to take the full tip credit.

It is important to note that no worker would take home in cash compensation (wages plus tips) less than column three: the Seattle minimum wage. But for tipped employees, the wage portion of that compensation could be as low as column five, with employers deducting from their minimum wage obligation up to the maximum tip credit or the employee’s earned tips, whichever is smaller. Under this scenario, the impact on labor costs at tipped establishments is substantially delayed, giving them ample time to adjust their business model to the new reality.

Conclusion:
The tip credit as implemented in 1966 was little more than a straight-up giveaway to the powerful lobbyists at “the other NRA,” the National Restaurant Association. Washington State voters have twice approved minimum wage measures with no tip credit, and given the subsequently impressive employment growth within our restaurant industry there is no good reason to second guess Washington voters now.

That said, if are going to set a precedent by accepting some sort of tip credit, the least we can do is set a precedent of making the tip credit better by both incentivizing full-time work and combatting wage and tip theft. Any and all of the proposals above would help achieve that, so I hope this post adds a little more thoughtfulness to the debate.

For the past three-plus years I spent so much time writing for Slog that I barely had time to read it, let alone leisurely browse the rest of media/blogo-sphere. The result is, apart from a handful of major media outlets and a few favorite politically oriented sites, I’ve pretty much lost touch with what else is out there.

So I’m curious: what are you reading? Where are you getting your local news, reviews, and commentary? Which sites do you find indispensable, or merely just a damn pleasure to read, guilty or not? Of course, Facebook and Twitter—I understand that. But which sites and writers, if they disappeared tomorrow, would you miss the most? And why?

Seriously. Help me reconnection to my post-Stranger world.

– Happy home opener day, Mariners fans. It’s maybe not the nicest day for it.

– Happy? equal pay day.

– It’s always pretty to think that Washington will come together in bipartisan comity and start governing for the good of all the people. To think this will happen as a result of the vastly wealthy having even more influence than they already have strikes me as so optimistic as to be delusional.

– What Does 17% Mean?

– Here’s another benefit in Seattle for Oso if you’re interested in it.

– We should definitely keep policing other people’s weight.

– Poor, poor Representative McAllister

There are lot of good reasons to oppose a “tip credit”, but one that isn’t often discussed is the way it incentivizes bad behavior on the part of unscrupulous employers by magnifying the rewards of wage theft. The math is subtle, but simple.

Let’s say you earn $27 in tips over the course of a nine hour shift. Under a straight up $15 minimum wage, you’d earn $15 an hour in wages plus $3 an hour in tips for a total cash compensation of $18 an hour. That’s $162 in tips and wages over a nine-hour shift.

But under a tip credit, that same shift would earn you only $135: $12 an hour in wages, plus $3 an hour in tips, for a total of $15 an hour. If your tips per hour are smaller than the maximum tip credit, all of your tips go toward your employer’s tip credit. You know—in his pocket. Whether you earn a dollar or two an hour more in tips or a dollar or two less, it makes no difference on your paycheck—all it does is raise or lower your employer’s labor cost by an equal amount. And that’s where the wage theft incentive comes in.

For example, let’s say your employer cheats you out of an hour, forcing you to clock out after only 8 hours or recording only 8 hours on your pay stub. Well, of course you lose an hour of pay, so your paycheck goes down $15 to $120. But your employer, who would have paid you $12 an hour over the course of a 9-hour shift, now gets to spread your $27 in tip credit out over fewer hours. $27 divided by 8 equals about $3.38 an hour in tip credit. So rather than paying you $12 an hour for 9 hours of work, your employer now only pays you $11.62 an hour for 8 hours of work. Such a bargain!

Of course, not all employers cheat like this. I’m guessing most don’t. But some do. And as the free marketeers will tell you, if you incentivize bad behavior, you’re likely to get more of it.

With Mayor Ed Murray expecting a recommendation on a minimum wage ordinance by the end of the month, members of his Income Inequality Advisory Committee are now negotiating in earnest. Nothing is set in stone, but the political realists on the committee realize that the proposal Murray ultimately submits to the city council will be for a $15 an hour minimum wage—if in name only. The proposal will also include some sort of multi-year phase-in, at least for “small” businesses; that’s a concession council member Kshama Sawant has already made from her initial “$15 Now” position. Also, expect to see tougher enforcement of wage and tip theft attached to the proposal.

Of course, details! But apart from the main points above, the debate has mostly shifted toward the definition of the word “wage.” Many on the business side of the table are arguing for a so-called “total compensation” minimum wage that would count both tips and the cost of providing benefits towards the employer’s $15 an hour obligation. As I’ve previously explained, that’s bullshit. Total compensation would mean a minimum wage worker earning $3 an hour in “benefits” (however those are defined and valued—again details!) would only take home $12 an hour in cash take-home pay. That’s not $15 hour! And that alone should make “total compensation” a nonstarter for anybody (or any mayor) who seriously claims to support raising the minimum wage to $15.

If we were talking about, say, an $18 total compensation minimum wage, that would be different. But we’re not.

(Also, because the cost of providing health care benefits inflates at a rate many times the Consumer Price Index, a total compensation model would erode the real value of an inflation-indexed minimum wage over time, as health care benefits gradually consumed a larger and larger share of total compensation. Honestly, read my analysis. The numbers are all there.)

Because of these obvious political and policy flaws, I am convinced that some on the committee are proposing total compensation as a mere negotiating tactic (you know who you are), intended to make way for a classic “tip credit.” (Opponents call it a “tip penalty.” What it really is, is a “tip deduction,” but we’ll use “credit” here for the sake of avoiding confusion.) A tip credit would permit employers to deduct from their minimum wage obligation the employee’s tips, up to the difference between Seattle’s minimum wage and the effective minimum wage for tipped employees under state and federal law—currently the Washington State minimum wage of $9.32 an hour.

To be fair, assuming no wage or tip theft, a tip credit would guarantee $15 in cash compensation. So there’s that. And on the vast majority of minimum workers who earn little to nothing in tips, a tip credit would have little to no impact. Considering where we were when striking fast food workers first started making the demand for $15 an hour, a $15 minimum wage with or without a tip credit would be a remarkable accomplishment.

So then why are the folks on the workers’ side of the table so adamantly opposed?

Because precedent!

Washington is one of only seven states without a tip credit, a distinction our restaurant industry and its Republican surrogates have relentlessly attempted to “fix.” Throughout much of the rest of the nation, the minimum wage for tipped employees is only $2.13 an hour, an absurdly low figure that inflicts poverty and abusive work conditions on a disproportionately female and minority workforce (70 percent of tipped workers are women!), while providing near-free labor to many restaurateurs. Wage and tip theft is rampant, and tip-dependent workers are forced to put up with all sorts of humiliation (and even outright assault) in order to secure the best shifts, and earn the highest tips.

Yes, the problem is with our tipped culture as much as it is with the tip credit, but a tip credit only makes things worse. Since the first $5.68 an hour of a worker’s tips would go straight into the employer’s pocket (as a deduction from their $15 obligation), any employee earning less than $5.68 an hour in tips (and most tipped employees do) would cost more to employ. Thus there would be even more pressure on a waitress to unbutton another button on her blouse in order to lower her employer’s labor costs.

I’ve got a daughter. Do I really want her being forced to show a little extra cleavage in order to keep her job, let alone up her hourly take-home pay? No.

So while $15 an hour with a tip credit would be a helluva lot better for most minimum wage workers than $9.32 an hour without, worker advocates and labor representatives simply don’t want to set the precedent that tip credit is an appropriate policy. They rightly fear giving state Republicans and squishy pro-business Democrats the ammunition to impose a tip credit statewide—a policy that would lower the income of Washington’s tipped workers everywhere outside of Seattle. That’s simply unacceptable. And they are also looking to set a good example for the cities and states that will inevitably attempt to follow in Seattle’s $15 an hour footsteps.

A tip credit is bad policy. It incentivizes wage and tip theft (an incentive I will illustrate in a subsequent post). It deceives consumers (who have no means of knowing if their tips are increasing the incomes of servers, or just decreasing the labor costs of employers). It helps perpetuate an unjust and abusive system. It is a totally arbitrary policy created in 1966 to buy off the National Restaurant Association (“the other NRA”) from opposing a federal minimum wage hike. And that is exactly what the Washington Restaurant Association and its surrogates are attempting today.

All that said, there may be room for a little compromise. But I’ll save that discussion for another post.

In Goldy’s metacommentary piece yesterday on The Seattle Times’ oppposition to funding Metro, he gave them some well deserved shit for pretending to oppose it because of its regressive nature.

Oh no! It’s a “regressive” tax! This from an editorial board that has opposed every single progressive tax (like, you know, on income or estates) that has come before it. What a bunch of fucking concern trolls.

But I think it’s even worse than that: We’ve known something was coming for a while. The Seattle Times ed board hasn’t exactly been leading the charge for a better system. Dow Constantine has been telegraphing since he got into office that he’d do something if the state didn’t act. And in that time The Seattle Times has neither suggested what that something ought to be nor have they pushed the legislature to act to allow King County to have a better system.

Could you imagine how different the debate would be in the state, if the state’s leading — or at least largest — paper had editorial after editorial pushing the legislature to let King County tax ourselves however we want? If they demanded that even if the GOP didn’t pass a complete transit package, that they at least give us a more progressive option?

Please join us tonight for an evening of politics under the influence at the Seattle Chapter of Drinking Liberally.

We meet every Tuesday in our new home at the Roanoke Park Place Tavern, 2409 10th Ave E, Seattle. The starting time is 8:00 pm, but some folks show up even earlier for dinner.

Can’t make it to Seattle? Check out another Washington state DL over the next week.

The Tri-Cities, Vancouver, WA, and Redmond chapters also meet on Tuesday. On Wednesday, the Bellingham chapter meets. On Thursday the Bremerton and Spokane chapters meet. The Centralia chapter meets on Friday.

With 215 chapters of Living Liberally, including nineteen in Washington state, four in Oregon, and three more in Idaho, chances are excellent there’s a chapter meeting somewhere near you.